Zalando Scores Growth Win with Strong Q3 Performance and Major Sports Partnerships

Zalando, the prominent German e-tail giant, announced a sustained profitable growth trajectory in its third-quarter performance, with management expressing satisfaction regarding the company's direction. While not all metrics showed an upward trend, the overall sentiment was positive, reinforcing Zalando's strategic execution across its business segments.

The company reported a gross merchandise volume (GMV) increase of 21.6% to €4.2 billion and revenue growth of 26.5% to €3 billion. This significant rise was primarily driven by the inclusion of About You in its financial figures. On a pro-forma basis, which offers a clearer like-for-like comparison, GMV grew by 6.7% and revenue by 7.5%, reaching just over €3 billion. Both Zalando and About You contributed strongly to this pro-forma growth. Segment-wise, B2C revenue climbed to €22.75 billion from €2.15 billion, and B2B revenue saw a healthy increase from €239 million to €277 million.

Profitability, based on a key metric, also rose, albeit at a slower pace than GMV and revenue. Adjusted EBIT increased to €96 million from €93 million a year earlier. However, the adjusted EBIT margin saw a slight dip from 3.9% to 3.2%. A deeper dive reveals that B2C adjusted EBIT actually decreased to €76.6 million from €86.7 million, while B2B adjusted EBIT significantly improved, rising to €19.6 million from €6.7 million. Despite these operational profit movements, the company's overall net income fell to €12.5 million from €44.3 million in the prior year.

Customer engagement metrics presented a mixed but generally positive picture. Zalando witnessed an increase in both active customers over the past year and the total number of orders placed. Although the average orders per active customer experienced a slight dip, the average basket size edged upwards, indicating customers are spending more per transaction.

In its B2C segment, Zalando is strategically doubling down on its sports opportunities. The company proudly announced a major partnership with the German Football Federation (DFB), becoming a main partner for the Men's, Women's, and Youth National Teams. Furthermore, Zalando has solidified its presence in key running events by securing partnerships with marathon events in Rotterdam and Copenhagen, and by strengthening its cooperation with the Berlin Marathon as a main sponsor. These initiatives are expected to significantly boost its sports business and enhance the customer experience.

The B2B segment demonstrated strong momentum, securing "major enterprise merchant wins," notably an expanded collaboration with Marks & Spencer. Building on existing relationships with retailers like Next, the M&S partnership is a significant milestone, now covering fulfilment for the brand’s entire continental European e-commerce business, complementing existing operations on Zalando, About You, and Amazon. The integration of About You's subsidiary SCAYLE into Zalando's ZEOS software stack has provided a robust enterprise shop system, enabling Zalando to support brands on their own e-commerce channels and contributing substantially to the strong traction in B2B. This was further evidenced by Europe's leading shoe retailer, Deichmann, going live with SCAYLE in Germany in August, which played a role in the 15.6% increase in B2B adjusted EBIT.

Reflecting on its year-to-date performance, Zalando confirmed its full-year 2025 guidance, projecting pro-forma GMV and revenue growth of 4% to 7%, with adjusted EBIT anticipated to be between €550 million and €600 million. David Schröder, Zalando co-CEO, commented, “The third quarter demonstrates how we are relentlessly executing our strategy to embrace the immense opportunities in front of us and to capture profitable growth across both B2C and B2B. The exciting new partnership with the German Football Federation DFB will allow us to boost our sports business further and to build an unparalleled sports experience for our customers, while our high calibre B2B partnerships showcase the superior value that we are able to deliver for brands and retailers with our unique e-commerce operating system.”