In the first quarter ending March 31, Farfetch has reported an increase in gross merchandise value (GMV) and digital platform GMV of 1.7 percent and 2.5 percent, respectively, to 930.8 million dollars and 809.5 million dollars.
Revenue increased 6.1 percent to 514.8 million dollars. Gross profit margin for the quarter was 44.8 percent and digital platform order contribution margin was 32.7 percent.
Farfetch founder, chair and CEO José Neves said: “Our core business remains very strong, in spite of the macro events in China and ceasing operations in Russia, which impacted our performance and outlook.
“Outside these external factors, we saw strong marketplace growth in the Americas and the Middle East, our customer and luxury brand relations are going from strength to strength, and we continue to make progress towards our mission of building the global platform for luxury.”
The company said, first quarter digital platform GMV growth reflects order growth across the marketplace, an increase in AOV from 618 dollars to 632 dollars, driven by increases in full-priced item mix and number of items per order, as well as strong growth in the Americas, Middle East and Korea. This was offset by softer demand in other key markets including Russia, where trade was suspended from March 2022 with no indication of when trade might resume, and China, where continuing local Covid-19 restrictions continue to impact orders in Mainland China.
Brand platform GMV decreased by 11.2 percent to 99.7 million dollars, due to continued delays in order shipments and resulting cancellations arising from the migration to a new warehouse partner. The transition was completed in May 2022, however, delayed shipments could negatively impact margins into second quarter 2022. The GMV decrease also includes a 4.5 percent decline due to changes in foreign exchange rates.
In-store GMV increased by 62 percent to 21.5 million dollars, driven by additional openings of New Guards brands stores in the last twelve months as well as growth from existing stores.
The revenue increase was primarily driven by 9.3 percent growth in digital platform revenue to 395.6 million dollars and a 74.8 percent growth in in-store revenue, offset by a 10.5 percent decrease in brand platform revenue to 100.5 million dollars.
Digital platform services revenue increased by 10.8 percent, driven by first-party revenue, which increased 16.1 percent. Digital platform services third-party revenue increased 7.8 percent reflecting a higher take rate and higher growth in advertising revenue. Digital platform fulfilment revenue increased 3.5 percent.
The company recorded profit after tax of 728.8 million dollars and adjusted EBITDA of negative 35.8 million dollars.
Gross profit increased by 9.6 million dollars or 4.4 percent to 230.5 million dollars in the first quarter of 2022. Basic EPS was 1.93 dollars and diluted EPS was negative 37 cents.
For the full year, Farfetch expects digital platform GMV growth of 5 percent to 10 percent, brand platform GMV growth of 10 percent to 15 percent and adjusted EBITDA margin of 0 percent to 1 percent.
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