H&M shares jump 11% as summer collection boosts profit

H&M’s Second-Quarter Profit Beats Estimates on Cost-Cutting and Summer Sales

H&M’s shares hit a 16-month high on Thursday after the company reported second-quarter profit that beat estimates. The results were driven by cost-cutting measures and strong sales of its summer collection.

H&M: https://www.hm.com/ , the world’s second-biggest fashion retailer, said operating profit in the quarter was 4.74 billion Swedish crowns ($438.6 million), down from 4.98 billion a year earlier but above the 4.07 billion forecast by analysts in a Refinitiv poll.

The company said it had reduced its inventory levels by 2.5%, which helped to boost margins. H&M also said it had benefited from warmer weather in Europe, which boosted sales of its summer collection.

H&M shares jump 11% as summer collection boosts profit, earn money, make money
Members of the shopping public pass beneath the H&M logo outside their shop at Oxford Circus, on 30th March 2023, in London, U.K.
Richard Baker | In Pictures | Getty Images

“The external factors that affect our purchasing costs continue to improve, work on the cost and efficiency program is proceeding at full speed, and much of the work that we have done in recent years is starting to bear fruit,” said CEO Helena Helmersson.

H&M has been facing increasing competition from fast-fashion rivals like Shein. However, the company’s recent results suggest that its cost-cutting measures and focus on higher-priced brands are starting to pay off.

What does this mean for H&M?

The strong second-quarter results are a positive sign for H&M. The company has been facing increasing competition from fast-fashion rivals, but its recent results suggest that its cost-cutting measures and focus on higher-priced brands are starting to pay off.

H&M is also benefiting from warmer weather in Europe, which has boosted sales of its summer collection. The company has said that it expects to continue to see strong sales in the coming months.

What does this mean for investors?

The strong second-quarter results are likely to be welcomed by investors. H&M‘s shares have been under pressure in recent months, but the recent results suggest that the company is on the right track.

Investors will be looking for H&M to continue to deliver strong results in the coming quarters. The company has said that it expects to see continued growth in its online sales and in its higher-priced brands.

Overall, the strong second-quarter results are a positive sign for H&M. The company is facing increasing competition, but its recent results suggest that it is well-positioned to continue to grow in the coming years.

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