reports
- Cédric Rossi
- Clément Genelot
Fashion: navigating a cautious summer
Based on recent market trends, the start of Q3 appears to be a continuation of the softness observed in May and June for the fashion industry, as prolonged macroeconomic and tariff-related uncertainty continues to weigh on consumer spending. This environment has prompted a wait-and-see approach amo
- Cédric Rossi
H&M: modest signs of improvement
While still showing a contraction YoY, Q2 margins improved sequentially versus Q1, lending more credibility to the company’s guidance for a positive inflexion point expected in H2 2025. However, H&M remains particularly sensitive to fluid external factors such as promotional activity, freight c
- Cédric Rossi
- Clément Genelot
Fashion: No sign of spring in second quarter
As we feared in our February sector update, tariffs took a toll on US consumer sentiment, prompting shoppers to become more cautious on discretionary spending. European optimism ticked up marginally as did spending intentions, leading to soft market trends in May-June. In view of constrained pricin
- Cedric Rossi
- Clement Genelot
Fashion disruption: will de minimis reforms trigger "de maximis" marke...
In addition to the implementation of reciprocal tariffs, the Trump administration is also closing the Chinese de minimis loophole from 1st May onwards, which will considerably disrupt the business model of major platforms like Shein and Temu in the US. Although this new market paradigm could be wel
- Cedric Rossi
- Clement Genelot
- Loic Morvan
On the shelves now: Consumer Weekly #64
In this Consumer Weekly newsletter, we provide a brief overview of the key factors affecting our Consumer coverage, from Luxury & Consumer goods to Retail & E-commerce and Food & Ingredients. This week, we look at accelerating trends in European corporate earnings relative to those in t
- Cedric Rossi
H&M: business model still fragile in an uncertain world
The mild reaction yesterday confirmed that investors had mixed feelings about the sharp 33% miss on Q1 EBIT and the scenario of gradual improvement throughout the year. Although management guided for a positive markdown impact in H2 2024, soft organic growth, rising inventory levels and volatile co
- Cedric Rossi
H&M: Soft Q1 sales momentum despite margin sacrifices
Arguably, with +2% FX-n in Q1 2025 H&M achieved two consecutive quarters of positive organic growth for the first time since Q4 2019-Q1 2020 (stripping out the atypical period of post Covid-related lockdowns until H1 2022), but it was fuelled by painful price reinvestments and marketing efforts
- Cedric Rossi
- Clement Genelot
- Loic Morvan
On the shelves now: Consumer Weekly #57
In this Consumer Weekly newsletter, we provide a brief overview of the key factors affecting our Consumer coverage: Luxury goods, Cosmetics, Consumer goods and Retail & E-commerce. This week, we look at the Fed's dilemma between its "wait-and-see" stance and mitigating the potential inflationar
- Cedric Rossi
Fashion: stay covered to thrive in the uncertain fashion world
Trump's tariff tactics confirm that the fashion industry is in for another volatile and uncertain year in 2025. Relatively resilient market trends across Europe and the US mask the growing number of price-sensitive consumers, forcing fashion groups to choose between top-line growth and margin prote
- Cedric Rossi
H&M: calendar effect and focus on cost discipline in Q4
In its Q4 2024 (Sep-Nov), H&M incurred a calendar effect (i.e. Black Friday events more skewed towards H&M's Q1 FY25) which led to a 2% miss on sales expectations (SEK62,193m vs. CSSe at SEK63,476m). However, it also had a positive impact on Q4 GM, helped by a focus on full-price sales, whi
- Cedric Rossi
- Clement Genelot
- Loic Morvan
- Paul Rouviere
- Philippine Adam
On the shelves now: Consumer weekly #41
In this Consumer Weekly newsletter, we provide a brief overview of the key factors affecting our Consumer coverage, from Luxury & Consumer goods to Retail & E-commerce and Food & Ingredients. This week, we look at the endless reshuffling of European purchasing alliances among food retai
- Cedric Rossi
H&M: blurred margin trajectory due to brand's investments to fuel sale...
Although the reduced 10% margin target came as no surprise since the CSSe has always been more conservative (8.2%e prior to Q3 publication), it reflects H&M's initiatives around brand activation and improved competitiveness to revitalise top-line growth. Negative external factors and markdown i
- Cedric Rossi
H&M: encouraging start to Q4 after an uninspiring Q3
The Q3 results unveiled this morning missed CSSe at both the sales and EBIT levels (-3% and -26% respectively), confirming once again that H&M is clearly more sensitive than ITX to volatile market conditions. On a positive note, sales trends have shown a gradual recovery with +3% FX-n over July
- Cedric Rossi
Fashion: sweet or sour Back-to-School?
While publications of US retailers this week (e.g.: Gap, Abercrombie & Fitch, lululemon, etc) should give the market a clearer view of the US consumer mood, the European consumer mindset is set to be reflected in H&M and Inditex's publications next month. As expected, the summer has been no
- Cedric Rossi
Fashion: will plans to impose duties on cheap goods disrupt Shein and ...
The very competitive prices offered by Shein and Temu stem from their ability to take advantage of tax loopholes allowing parcels to be shipped without having to pay duties and taxes as long as they are under a certain value. As the EU Commission is moving to scrap the EU's EUR150 import tax loopho
- Cedric Rossi
- Clement Genelot
- Loic Morvan
- Paul Rouviere
- Philippine Adam
On the shelves now: Consumer weekly #35
In this Consumer Weekly newsletter, we provide a brief overview of the key factors affecting our Consumer coverage, from Luxury & Consumer goods to Retail & E-commerce and Food & Ingredients. This week, we look at the political uncertainty that is clearly set to drive stock markets unti
- Cedric Rossi
H&M: Doubts on profitability, or on Europe's political stability?
In our view, yesterday's 13% drop in the share price is mainly due to weakening investor sentiment amid political turmoil (Europe is 63% of H&M's revenue), rather than to disappointing June sales (-6% FX-n), as CSSe (9.1%) was already well below the company's EBIT margin target of 10%. Arguably
- Cedric Rossi
Fashion: consumers backpedaling on sustainability due to inflation
In our recent Fashion report "Is sustainability the new luxury?", we were highlighting the green consumer paradox vis-a-vis sustainable brands. A McKinsey survey just discovered that consumers are indeed de-emphasising the importance of ESG in their purchases in an inflation-impacted world. This wo
- Cedric Rossi
Fashion: a wet spring but blooming publications
Despite a wetter-than-average spring season over a large part of Europe, key European fashion markets have shown some resilience over recent months, partly thanks to a gradual improvement in European consumer sentiment. Inditex is due to report Q1 results (February-April) on 5th June, followed by H
- Cedric Rossi
Fashion: Is sustainability the new luxury?
The bankruptcy of circular fashion startup Renewcell combined with the stellar success of Chinese platforms Shein and Temu have highlighted the green consumer paradox: consumers say they want sustainable clothing, but the majority are not tending to buy them, especially at a time when cost-of-livin
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