- Prachi Singh |
For the second quarter, Farfetch Limited reported gross merchandise value (GMV) increase of 232.8 million dollars to 721.3 million dollars, representing year-over-year growth of 47.7 percent, while Digital Platform GMV increased by 166.7 million dollars to 651 million dollars, up 34.4 percent. The company said in a statement that revenue increased by 155.4 million dollars or 74.2 percent to 364.7 million dollars in second quarter driven by 34.6 percent growth in Digital Platform Services revenue to 237.6 million dollars and the addition of Brand Platform revenue from New Guards. The company added that in-store revenue decreased by 7.1 percent to 3.9 million dollars primarily due to Covid-19-related store closures for the majority of the quarter, partially offset by the addition of revenue from New Guards. Cost of revenue increased by 81.3 million dollars or 65.6 percent to 205.3 million dollars in second quarter 2020.
Commenting on the second quarter trading, José Neves, Farfetch Founder, Chairman and CEO said: “Second quarter was record-breaking for Farfetch. We’re pleased to support such a large number of the world’s leading luxury brands who are leveraging our global platform to navigate the current landscape, including our top 20 direct brand e-concessions who, together, have benefitted from a doubling of sales year-on-year.”
Review of Farfetch’s second quarter results
The company said, gross profit increased by 74.1 million dollars or 86.9 percent to 159.4 million dollars in second quarter due to growth in Digital Platform Services revenue and the addition of New Guards Brand Platform operations. Gross profit margin increased from 40.8 percent to 43.7 percent and Digital Platform Gross Profit Margin increased from 47.6 percent to 55 percent.
Adjusted EBITDA for the quarter improved by 12.4 million dollars to negative 25.2 million dollars and adjusted EBITDA margin improved from negative 20.8 percent to negative 8.2 percent. The company added that loss after tax increased by 340.5 million dollars to 435.9 million dollars.
For the third quarter, Farfetch expects Digital Platform GMV of 588 million dollars to 609 million dollars, representing growth of 40 percent to 45 percent, Brand Platform GMV of 90 million dollars to 95 million dollars and adjusted EBITDA of negative 20 million dollars to negative 25 million dollars.