H&M quarterly earnings beat analysts’ forecasts
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Today, March 30, the Swedish clothing retailer H&M presented a report (.pdf) for the first quarter of fiscal year 2023 ended at the end of February. The company’s revenue grew by 12%, amounting to 54.9 billion Swedish kronor ($5.3 billion). The operating profit of the company increased by 58%, to 725 million crowns ($70 million). If the revenue data was in line with preliminary estimates, then the profit was better than analysts’ expectations, so that H&M shares rose more than 18% after the publication of financial statements.
H&M continues to lag behind its main competitor – the Spanish company Inditex, which in mid-March introduced good reporting for 2022. The Swedish retailer, with its more budget-friendly range, faces stiff competition from companies like China’s Shein, which produce even cheaper and faster-changing clothes than H&M. The company is currently undergoing a restructuring, which was announced in November, and is expected to save the company $190 million a year.
It is especially difficult for a company with sales in China, where last year the local authorities and the public urged residents to boycott H&M following its allegations of forced labor in the Xinjiang Uygur region. True, since then, H&M products have reappeared on the local online trading platform Tmall. In the first quarter, the company’s sales in China grew by only 3%, which is significantly less than the growth in the world as a whole.
More details – in the material “Kommersant” ‘Inditex and H&M face challenges and growth’.
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