Inditex Reports Slower Sales Growth, Misses Q1 Revenue Estimates

Zara owner Inditex reported a slowdown in sales growth during the first quarter of 2025, with revenues rising only 1.5% to €8.27 billion, missing analyst expectations and reflecting a cautious consumer environment influenced by economic uncertainties and cooler weather in key markets like Spain. Despite this, the company maintained a stable gross margin of 60.6% and a net profit of €1.31 billion, supported by ongoing investments in store upgrades and technology. Inditex's store network shrank to 5,562 outlets, down from 5,698 a year earlier, as part of its strategy to optimize retail space. Early second-quarter sales showed some improvement with a 6% increase compared to last year, although this was slower than the 12% growth seen in the same period in 2024. The company also cited challenges such as power outages in Spain and Portugal, along with trade and inflation concerns, as factors dampening consumer spending. Overall, Inditex's performance highlights resilience amid a challenging global economic landscape, with a strong balance sheet and cautious optimism for profitable growth.