Once an e-commerce darling, ( ) has suffered a fairly dramatic fall from grace in recent years. The ASOS share price has plummeted a staggering 88% over the past five years, leaving many investors shell-shocked. So is the company now in real trouble, or are there signs of a recovery underway? I’ve taken a closer look.
The decline The company’s descent can be attributed to a combination of factors, both internal and external. The Covid-19 pandemic disrupted global supply chains, leading to inventory shortages and fulfilment challenges. Rising costs and inflationary pressures further compounded the company’s woes, squeezing margins and undermining profitability.
Compounding these external pressures were internal missteps. International expansion proved overly ambitious, resulting in operational inefficiencies and ballooning costs. The company’s failure to adapt to changing consumer preferences and the competitive landscape further eroded its market position.
The numbers The financial performance of the business reflects the depth of its struggles. In its latest earnings report, the company posted a loss of £248.1m for the previous year.
Moreover, its net profit margin stands at a dismal -7.72%, a far cry from the lofty heights it once enjoyed. However, there are glimmers of hope.
Revenue for the last year reached £3.21bn , indicating that the brand still heavily resonates. Additionally, the company’s impressive gross margin of 43.
44% suggests that its core business .