Farfetch profits rise thanks to “strong momentum”

// Farfetch sales and shares rise after strong progress in business

// Annual gross merchandise value (GMV) rose 33% year-on-year to £3.1bn

Farfetch has reported strong progress after witnessing record sales figures and a rise in shares.

The online luxury retailer saw annual gross merchandise value (GMV) rise 33% year-on-year to £3.1 billion, and almost doubled compared to 2019 with a 98% surge.

Revenue also increased 35% to £1.4 billion.

In the fourth quarter, GMV and digital platform GMV each increased 22% YOY, reaching £970 million and £821 million, respectively. Q4 revenue also jumped 23% to £497 million.

The business also saw a quarterly gross profit margin of 47.1%, up from 46.1% a year earlier, while the full-year figure rose to 46.1% from 45%.

And the digital platform order contribution margin was 32.4%, although this was down from 35.1% in 2020’s fourth quarter. For the full year, that margin dropped to 31.6% from 35%.

“The figures clearly demonstrate the strong momentum behind the Farfetch platform,” founder and chief executive José Neves said.

“We exit the year having once again delivered market-share-capturing GMV growth in 2021 along with our first year of adjusted EBITDA profitability.

“This positions Farfetch for an incredible 2022 focused on continuing to lead the online luxury fashion industry, growing faster than the runner-ups, and expanding profitability.”

The company said third-party transactions generated 85% of digital platform GMV at a take rate of 30.4% in the fourth quarter and the Farfetch Marketplace saw supplies from both multi-brand retailers and e-concession partners continuing to increase YOY to total stock units of nearly 10 million in the quarter.

It was also the third consecutive quarter of record “media solutions revenue” as it partnered with brands to launch innovative showcases of their collections to Farfetch Marketplace visitors.

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