Zara owner Inditex (ITX.MC) reported a 54% increase in first-quarter profit on Wednesday as sales kept pace after a successful 2022 beating other stores during a cost of living crisis.
The world’s largest fast fashion firm announced a net profit of 1.16 billion euros ($1.24 billion) for the April quarter, topping Refinitiv analysts’ average projections of 980 million euros.
Last week, Inditex’s market value reached 100 billion euros ($107 billion), yet cost pressures like a 20% increase in Spanish store workers’ average earnings make it difficult to maintain prices low.
In the first quarter, in-store and online sales grew 13% to 7.6 billion euros. H&M (HMb. S.T.) failed to attract cost-of-living-affected shoppers. Weather in H&M’s native market also hurt sales.
Inditex, which owns Pull&Bear and Massimo Dutti, reported a 17.5% growth in sales from February to March, excluding Russia.
Inditex raises pricing beyond the Eurozone. Some garments are 91% more expensive in the U.S., Mexico, or Saudi Arabia.
Southern Europe’s weather-unaffected sales have countered U.S. demand’s decline.
