Inditex Reports Record Sales but Shares Fall Amid High Expectations
Fast fashion giant Inditex reported record first-half sales and profits in fiscal year 2026, yet its stock fell around 3% as investors found the results slightly below expectations. The company achieved €19.76 billion ($23 billion) in revenue for the six months ending July, a 7.6% increase from last year, with constant-currency growth at 9.2%. Net profit rose to €2.98 billion and EBITDA hit €5.51 billion, both record highs. Despite strong performance, investors focused on signs of slowing profitability improvement due to rising transport costs linked to Middle East disruptions and higher operating expenses. The second-quarter gross margin was slightly below expectations at 56.7%, while the company also increased planned investments in corporate facilities by €200 million this year. Inditex is closing smaller stores but expanding flagship locations, technology, and logistics as it continues to grow revenue despite store count reductions. The market now expects near-perfect execution from a company valued among Europe's top growth businesses. While its integrated supply chain gives an edge over weaker competitors, rising costs are challenging margin expansion.
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