Inditex Reports Weaker Second-Quarter Sales Amid Consumer Caution

Inditex, the Spanish fashion giant and owner of Zara, reported weaker-than-expected second-quarter sales of 10.08 billion euros, missing analyst forecasts due in part to cautious consumer spending and a weaker U.S. dollar impacting revenue in its second-largest market. Despite the shortfall, the company showed an acceleration in growth with first-half sales up 5.1% year-over-year and a 9% sales increase in the early autumn quarter, signaling potential recovery. CEO Oscar Garcia Maceiras described the first-half performance as "solid" amidst a complex market environment, emphasizing the company's flexible supply chain and proximity sourcing to adapt to challenges such as U.S. tariffs. Inditex’s net profit rose modestly by 0.8% to 2.79 billion euros, while earnings before interest and taxes grew 0.9%, reflecting resilient but cautious demand. The slowdown in sales growth has raised questions about Zara's ability to maintain margins, especially with tariff pressures and currency headwinds. Overall, Inditex’s results underscore the ongoing challenges faced by retailers in a volatile global market, with signs of recovery potentially boosting investor sentiment going forward.