European online fashion retailer Zalando has announced a significant rebound in its financial performance, marked by increased revenue, profits, and customer numbers. The company also revealed plans to expand its operations into Portugal, Greece, and Bulgaria later this year, aiming to strengthen its presence in Southern and Eastern Europe.
In its latest financial report, Zalando confirmed that 2024 revenue grew by 4.2% compared to the previous year, with gross merchandise volume (GMV)—a measure of total sales value—rising by 4.5%. Net income surged to €251.1 million, more than triple the figure reported in 2023. The company also added 2.2 million active customers over the past year, reaching a record 51.8 million users.
This turnaround follows two consecutive years of declining sales, with Zalando’s mid-January provisional results already hinting at renewed growth. The final figures solidify the company’s recovery, driven by what it calls an “ecosystem strategy,” which focuses on integrating its online platform with partner brands, logistics networks, and customer loyalty programs.
Financial Recovery Gains Momentum
After facing challenges in 2022 and 2023, Zalando’s 2024 results signal a clear shift. Revenue reached €10.1 billion, up from €9.7 billion the prior year. The net income of €251.1 million far exceeds the €80 million reported in 2023, reflecting improved cost management and higher margins.
The company attributed its success to several factors, including better inventory management, stronger partnerships with fashion brands, and increased efficiency in delivery and returns processes. Zalando also noted that its premium subscription service, “Zalando Plus,” which offers free shipping and exclusive discounts, has attracted over 1 million members since its launch in 2022.
Customer Base Hits New High
Zalando’s active customer count rose to 51.8 million, up 2.2 million from 2023. The growth was particularly strong in existing markets like Italy and Spain, where the company has invested in localized marketing and faster delivery options. The retailer also reported a 12% increase in orders per customer, indicating higher engagement.
“We’ve focused on making our platform more convenient and personalized,” said Robert Gentz, co-CEO of Zalando. “Customers are responding to improvements in product recommendations, sustainability filters, and delivery flexibility.”
Expansion Targets Southern and Eastern Europe
Later this year, Zalando will enter Portugal, Greece, and Bulgaria, marking its first expansion since 2021. The move is part of a broader effort to tap into underserved markets where online fashion penetration remains relatively low.
In Portugal and Greece, Zalando will compete with local retailers and international players like Amazon. Bulgaria, meanwhile, represents a newer frontier for e-commerce, with rising internet usage and demand for international brands. The company plans to offer localized websites, customer service, and delivery partnerships in each country.
Challenges and Outlook
Despite the positive results, Zalando acknowledged ongoing pressures, including higher logistics costs and competitive pricing in the European e-commerce sector. However, the company expressed confidence in its strategy, forecasting revenue growth of 5-7% for 2025.
Analysts have reacted cautiously to the expansion plans, noting that newer markets may take time to turn profitable. Nevertheless, Zalando’s strong financial base and improved operational efficiency suggest it is well-positioned to navigate these hurdles.
As the company prepares to enter its 25th market, its focus remains on leveraging technology and partnerships to sustain growth. With a reinvigorated customer base and a clearer path to profitability, Zalando’s latest moves could redefine its role in Europe’s evolving retail landscape.