Turn your clothes inside out. Then, check the label. You’ll likely find Inditex. In fact, you own one item. Furthermore, if you’re curious about the company behind your clothes, you might want to look into Inditex stock.
Inditex is the parent company. It owns popular brands. These include Zara and Zara Home. Also, Oysho and Pull & Bear. Massimo Dutti is included. Stradivarius and Bershka too. These brands are fast fashion. Inditex is the largest retailer.
Headquartered in Arteixo, Galicia, Spain, Inditex has more than 5,500 stores across 213 markets worldwide.
Inditex shares fall
2025 has not been very kind to the retail giant. Inditex stocks fell 8%. This happened on 12 March. Zara reported slowing sales. Massimo Dutti also reported this. Sales slowed since 2025 started.
Last year, the firm performed well. Sales grew by 10.5%. This was in constant currency. Sales reached €39 billion.
Additionally, dividends increased by 9%. Inditex had also opened 47 new stores including some of its famous brands such as Zara, Bershka, and Stradivarius. CEO Oscar Garcia Maceiras spoke.
He made a statement. Sales and profit figures were excellent. These show Inditex’s growth. Growth is profitable and solid.
Despite strong results, shares dropped. Inditex reported weaker growth. Growth was 4% between 1 February and 10 March. This was lower than last year’s 11%.
The company plans to create more stores for Pull&Bear, Bershka, and others in old and new markets.
Analysts’ insights on Inditex: Trump’s tariffs and global uncertainty
Deutsche Bank analysts noted this. Market consensus was lower. It was lower than usual. Despite this, Inditex’s stock slid. This happened unexpectedly. Inditex remains popular with investors.
They said the 4% sales growth in the past five weeks was “below the bottom end” of the range they had anticipated.
Before the results, Deutsche Bank’s analysis of internet search and cargo data suggested that the brand’s momentum was cooling off and growth was slowing down.
Morningstar Analyst’s Perspective on the Slowdown
Morningstar equity analyst Jelena Sokolova explained that it was “too early to extrapolate the slowdown into the future,” considering Inditex’s 2024 performance this year.
Retailers Facing Deteriorating Demand and Limited Consumer Spending
Retailers are still struggling with deteriorating demand and limited consumer spending, something that has helped Zara, since many consumers turned away from luxury brands and towards more affordable purchases.
However, global uncertainty and the risk of US President Donald Trump’s tariffs on global growth pose new challenges. The US for example is Inditex’s second largest market, despite most clothes being produced in Spain, Portugal, Turkey, and Morocco.
H&M’s Strategy in Response to Global Challenges
Similar obstacles are faced by other retailers. Swedish mass retailer H&M is trying to nearshore the production of its products.
CFO Adam Karlsson explained that the company has chosen this for various reasons, including geopolitics and to increase its responsiveness to customer demand.
H&M’s sales during the final quarter of 2024 disappointed as it came in below estimations, but its full-year results were up by 1%.
H&M’s Position on Tariffs and Pricing
Karlsson said: “If tariffs increase for everyone, there will be a relative position to take (on pricing).
We should position our offering in the same way no matter whether there are tariffs or not.”
Kering’s Strategy for Navigating Tariffs
According to Francois-Henri Pinault, who is the CEO of Kering, the luxury company behind Gucci and Saint Laurent, the company will navigate potential tariffs without moving any production to the US.
Inditex’s CEO on Tariffs and Business Flexibility
On the subject of tariffs, Inditex’s Garcia Maceiras explained that it was “difficult to predict” how these would impact the business but was confident the company had the flexibility and strength to respond to the changing landscape.
He said: “We consider that we are in a very good positioning due to our levels of geographical diversification in terms of sourcing and sales. As we operate in many markets, we have experience dealing with different tariff regimes.”
Investors are alarmed as Inditex shares slide
Inditex’s lower sales, which only rose 4% in the past five weeks to 12 March, were below the quarterly growth rates of 7% or more in the past year, as it was reported in the Financial Times. (12 March). Its shares dropped 7% after the Spanish retailer said sales growth had started to cool.
Inditex surprised investors after its disappointing results which were much below its quarterly growth rates of 7% in 2024. This marked the company’s weakest trading update since 2016, as UBS analysts noted.
The Impact of Donald Trump’s Tariff Threats
US President Donald Trump’s tariff threats have caused market uncertainty about their impact on the global economic outlook and have also weighed on the stock.
While Inditex doesn’t manufacture any of its clothing in the US, it remains extremely popular with American consumers since the US is the second biggest market. Europe remains Inditex’s biggest market.
Strong Fourth-Quarter Performance
In the fourth quarter, including Christmas season, sales were up 8.4% to €11.2bn and net profit increased almost 14% to €1.4bn.
Post-Covid-19 Growth and Market Normalization
Inditex, which receives more than two-thirds of its sales from Zara, expanded faster than many of its competitors following the Covid-19 pandemic. However, some analysts said that with its recent results its performance was “normalising”.
Regional Weakness and Sales Breakdown
According to sales numbers for the three months to the end of January, there was relative weakness in the Americas region and Asia.
CEO Óscar García Maceiras’ Response to Weak Figures
Inditex’s chief executive Óscar García Maceiras tried to minimise the importance of the weak figures by explaining that the five-week period from 1 February to 10 March was merely a small part of the year at the beginning of the season for spring and summer fashions.
The company also sought to downplay the results by publishing the past week’s numbers which showed a 7% rise, noting that they were confident for the year ahead.
Inditex Stock Performance and Market Capitalisation
Inditex stocks were down 7.5% at €45.01 in March and Inditex’s market capitalisation was under €139bn. On 2nd April 2025, its shares were slightly higher at €46.40 and its market capitalisation at €143.93bn. Since mid-2022, its share price has more than doubled.
CEO’s Optimism Amid Global Trade Concerns
In regards to Trump’s trade policy, García Maceiras said: “The current environment is difficult to predict in terms of tariffs . . . However, we consider that we are in a very good position due to our levels of geographical diversification in terms of sourcing and sales. As we operate in many markets, we have experience dealing with different tariff regimes and we also have a flexible business model.”
The Future of Inditex: Challenges Ahead
Inditex future remains uncertain amid global changes
From tariffs to intense competition and sustainability concerns, Inditex’s challenges as it looks ahead are multifold.
Inditex has to deal with super-fast, super-cheap competitors like Shein and Temu, as well as overcome scrutiny regarding pollution from air freight shipments from supplier factories.
Consumer demand, online shopping and changing consumer behaviours have also changed the shopping landscape with many Inditex stores forced to close their doors.
As the company is committed to rising above these obstacles and implementing new strategies to address new patterns, rising consumption trends and updating its sustainability targets, analysts will closely monitor its stock for clues about evolving market dynamics.
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