H&M, the second-largest publicly traded fashion retailer globally, surpassed first-quarter operating profit projections, aided by a smaller decline in sales than anticipated.
The Swedish company reported an operating profit of 2.08 billion crowns ($196 million), a significant increase from 725 million, surpassing analysts’ expectations of 1.43 billion in an LSEG poll.
Sales experienced a 2% decline, which was better than what analysts had anticipated. However, at the beginning of its second quarter, sales increased by 2%, indicating heightened demand for its clothing and accessories.
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“The sales for the quarter saw a gradual improvement throughout February, particularly with the positive reception of our Spring collections, indicating that we are moving in the right direction,” stated CEO Daniel Erver, who assumed the role two months ago.
Erver’s challenge will lie in demonstrating H&M’s ability to increase profit while also restoring sales growth.
H&M has announced its goal of achieving a 10% operating profit margin by the end of this year.
The company, famed for its $19.99 jeans and $15 dresses, also sells leather trousers for more than $300 and coats for up to $1,190 under its Cos brand.
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