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Inditex Posts Strong Q1 and Early Q2 Sales Jump

Stronger margins, flat inventories, a €10.8 billion cash buffer let Inditex expand its store footprint.

Overview

  • Inditex reported first-quarter net sales of €8.75 billion, up 8.8% on a constant-currency basis and modestly ahead of analyst expectations.
  • The group said trading between May 1 and June 1 rose 11.5% in constant currency, signaling a brisk start to the second quarter.
  • Profitability improved in Q1 with a 61.2% gross margin, gross profit of €5.4 billion, EBITDA of €2.6 billion, and net income of €1.4 billion.
  • Inventory was essentially flat, rising about 1% year-on-year, while the company holds a €10.8 billion net cash position and plans roughly 5% growth in gross selling space this year with selective expansion of its Lefties off-price concept.
  • Inditex credits its near-market supply chain for faster reorders and seasonal agility and cites growing use of artificial intelligence, a combination that could let it avoid heavy discounting and shift investment into stores, logistics and technology.