Farfetch’s Q2 to June 30 saw digital platform GMV and digital platform services revenue growth accelerating to 7% and 10% year-on-year. And it saw record active consumers of 4.1 million, up 7%.
But it wasn’t all good news. While total group GMV rose to $1.32 billion from $1.02 billion, revenue dropped to $572 million from $579 million. And adjusted revenue was down to $481 million from $499 million.
A big reason for this was a 42.2% decrease in brand platform revenue to $67 million and a 15.1% drop in revenue generated in-store to $23 million.
Gross profit was $242.87 million, down from $267.67 million and the gross profit margin dropped to 42.5% from 46.2%. The loss after tax was $281.3 million down from a profit on the same basis of $67.6 million a year earlier.
For the core digital platform, third-party transactions generated 80% of GMV. Supply from both multi-brand retailers and e-concession partners increased over 40% year-on-year to nearly seventeen million total stock units and it signed over 30 new e-concession brand partners in the first half.
That rise in active consumers was supported by a higher mix of personalised communications which have demonstrated higher conversion. It also could have been helped by the fact that it launched a capability allowing consumers to shop in their preferred language, no matter where they are in the world.
For the year, the company expects group GMV of approximately $4.4 billion, up from $4.1 billion in 2022 and digital platform GMV of approximately $3.85 billion, up from $3.5 billion. Brand platform GMV of approximately $0.45 billion should be broadly flat compared to 2022, while revenue of around $2.5 billion should be up from $2.3 billion.
Chairman and CEO José Neves said the results “show Farfetch is growing, becoming more efficient, and executing on our key strategic priorities. We have also taken decisive action to adapt to the macro environment of the last 18 months. 2023 is set up to be a great year for Farfetch, toward strong GMV growth, Adjusted EBITDA profitability and positive free cash flow”.
And CFO Elliot Jordan added: “I’m pleased with our second quarter performance, which demonstrates our progress towards delivering profitable growth and positive free cash flow in 2023. Our digital platform has performed particularly well, returning to growth while maintaining a stable order contribution margin. This, coupled with significant savings in the cost base across all areas of the business, means our digital platform is more profitable than last year. We enter the second half well positioned to achieve faster levels of growth, with a lower cost base and strong liquidity.”
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