Is Asos about to find itself among them? Signs suggest that this is true. This is due to the fact that the financial year of 2025 is forecasted to close with another drop in revenue for the British online fast fashion brand this time by 15% in comparison to the prior year.
Although the operational deficit has slightly improved, it still remains concerning: it is equivalent to roughly 10% of sales a shortfall that is improbable to be remedied.
The count of customers marked as “active” has dropped by an additional 14%, while traffic to the online site has also fallen by 15%. The decline is especially notable outside the UK, where Asos appears to be losing ground entirely. The sole piece of good news: By executing a strategic refinancing move, aided by the divestment of the Topshop and Topman labels, the company managed to cut its net liabilities from 587 million to 410 million pounds without needing to raise new capital. Asos has struggled to cope with the emergence of innovative and aggressive competitors such as Shein, Vinted, and others. The German rival Zalando, which uses a more versatile and open platform approach, has also significantly outpaced the British retailer.
Since reaching the high point of the pandemic, Asos’ revenues have shrunk by half. The firm is now reporting operational losses for three consecutive years. In the last five years, it has had to secure additional funds twice to manage its still troubling level of debt. Under the leadership of Mike Ashley and Danish billionaire Anders Holch Povlsen, Asos has never managed to distribute capital back to its shareholders – neither via dividends nor share repurchases, even at its most successful times.
