What's Happening?
LuxExperience, the parent company of Mytheresa and Yoox Net-a-Porter, reported a 4% decline in overall sales, amounting to €589 million in its fiscal first quarter ending in September. The company's net
losses increased significantly to €98.4 million. The decline was primarily driven by Yoox Net-a-Porter, which saw a 19% drop in sales to €119 million. Meanwhile, Net-a-Porter and Mr Porter experienced an 11% decrease in sales, totaling €225 million. Despite these challenges, Mytheresa showed positive growth, with a 14% increase in sales year-on-year, reaching €246 million ($284 million), largely due to strong sales in the U.S. The German e-tailer also more than doubled its adjusted earnings before interest, taxes, depreciation, and amortization to €8 million.
Why It's Important?
The financial struggles of LuxExperience highlight the challenges faced by luxury e-commerce platforms in maintaining profitability amidst changing consumer behaviors and economic pressures. The decline in sales at Yoox Net-a-Porter suggests a shift in consumer preferences or spending habits, which could impact the broader luxury retail market. Mytheresa's growth, particularly in the U.S., indicates potential opportunities for luxury brands to capitalize on specific regional markets. The company's efforts to reduce losses, including asset sales and layoffs, reflect strategic moves to stabilize its financial position and achieve long-term growth targets.
What's Next?
LuxExperience aims to increase overall sales to €4 billion by 2030, up from €2.7 billion at the end of fiscal 2025. The company is taking steps to reduce losses, including selling assets of The Outnet to The O Group for $30 million, a deal expected to close in the first quarter of 2026. These actions, along with announced layoffs, are part of a broader strategy to streamline operations and focus on profitable segments. The luxury e-commerce sector may see further consolidation or strategic partnerships as companies seek to enhance their competitive edge.
