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ASOS has reiterated its guidance for 2026, as it reported a 50% year-on-year increase in underlying profitability for the six months ended 1 March, despite a 9% fall in gross merchandise value.
The online fashion retailer also saw its adjusted gross margin increase by 330 basis points to 48.5% during the six-month period, as improved margins and cost discipline drove the growth in EBITDA.
It comes as ASOS outperformed the wider group in the UK, with gross merchandise value falling by 5%. New customer numbers across its top four markets likewise rose 2% following the launch of a loyalty programme.
Fixed costs fell by more than 10% during the period, which the company attributed to warehouse optimisation and the renegotiation of distribution contracts in the UK. This also led to an improvement in stock sell-through rates.
Digital updates to the company mobile app included virtual try-on features and outfit curation tools. The retailer stated that these initiatives contributed to an increase in average order values and higher customer engagement.
For the full year, the company expects adjusted EBITDA to reach between £150m and £180m. It anticipates gross margins will remain between 48% and 50% while maintaining a neutral free cash flow.
José Antonio Ramos Calamonte, chief executive of ASOS, said: “Our first half shows continued progress on executing our strategic priorities across Relevant Fashion Product, Inspirational Shopping Experience and an Efficient Operating Model. The result has been a c.50% YoY increase in underlying profitability.
“The enhancements we have made to the customer experience, including our revitalised app, are helping people to find not just items, but outfits, styled just for them. We are seeing improvements in new customer growth and strong performance in our womenswear business, both of which are encouraging lead indicators for sales growth.”
