The COVID-19 pandemic saw consumers flock to online shopping and European e-commerce giant Zalando benefited massively from this. But as the Berlin-based company reported its results for the full year 2022, it was clear those days were well and truly over.

Previously Zalando had racked up double-digit increases in sales but reported a decrease of 0.1 percent for all of 2022, to bring in 10.34 billion euros. In 2021, the company had recorded growth of close to 30 percent and revenues of 10.35 billion euros.

The 2022 results came on the back of a fourth quarter that saw 2.2 percent sales growth. Over the last three months of 2022, this generated sales of 3.17 billion euros.

The results were broadly in line with the lower end of market predictions.

In a statement, the company lamented the fact that 2022 was “a year when e-commerce tailwinds turned into economic headwinds.” In fact, Zalando said, consumers had gone back to brick-and-mortar retail with far greater enthusiasm than it expected.

Zalando’s other measure of success is gross merchandise value, or GMV. This number accounts for how much inventory the platform has moved, as opposed to income from services like logistics and marketing. GMV is generally higher than revenues and reached 4.57 billion euros worth of stock shifted in the fourth quarter. This fed into GMV growth of 3.2 percent for all of 2022, totaling 14.8 billion euros. In 2021, GMV grew 30 percent.

The company has undertaken a variety of streamlining and cost cutting measures over past months, including announcing several hundred job cuts last month, and its adjusted EBIT for the full year came in at 184.6 million euros.

The number of active customers at Zalando continued to grow in 2022, increasing 5.7 percent to 51.2 million shoppers. At the same time, the company also saw the basket size, or value of each customer’s order, dip slightly. This went from 56.80 euros per basket to 56.70 euros over the course of the year.

During 2022, Zalando had been forced to lower guidance and most recently it also stepped away from its stated goal of moving 30 billion euros worth of goods by 2025. The focus now is on improving profit margins and deepening relationships with its customer base, it said in a statement.

For 2023, Zalando now expects revenue to grow between negative 1 percent and 4 percent, while GMV should increase between 1 percent and 7 percent, the company noted.

“Our long-term ambition remains unchanged,” Zalando co-chief executive officer Robert Gentz said in a statement. “We remain confident that we will return to double-digit GMV growth in the midterm, by further executing on our vision and strategy, and eventually serve 10 percent of the 450-billion-euro European fashion market.”

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