Boohoo sales plummet in Q3 2022 amid London layoffs

Boohoo has posted its second consecutive quarter of sales declines, after revenues slumped during Q3 2022.

Extended delivery times compared with  pre-pandemic levels contributed to an overall revenue decline of 11% to £637.7m.

In the UK, revenues also slipped by 11% to £400.8m, down from £451m just one year earlier.

Its international performance was also affected by difficult global trading conditions, with US sales falling sharply from US$145.8m to $128.9m.

"Performance in the period is in line with expectations and reflects the normalisation of the channel shift online over the last 12 months, but demonstrates the significant market share gains the group has made over the last three years,” said Boohoo CEO John Lyttle.

It comes after Boohoo announced more than 100 job cuts at its London office.

The redundancies are aimed at the retailer’s e-commerce, buying and design departments based in Soho.

Boohoo has not yet confirmed the exact number of job cuts.

“To ensure long term, sustainable growth of our brands we have taken the difficult but necessary decision to consider a proposal to reduce the number of roles in specific areas of the business,” a spokesperson for Boohoo told Cosmetics Business at the time.

“Our people teams will be supporting those potentially affected."

The third-quarter results are the latest stumbling block in what has been an increasingly challenging year for the fast fashion and beauty retailer.

Revenues slumped by 10% to £882m for the six months ended 31 August 2022.

This was the result of softened demand during Q2, as well as a spike in returns rate, which impacted the group’s half-year results.

Boohoo is now anticipating sales declines of approximately 12% for the remainder of the 2022 financial year.

The brand said it remains focused on optimising its operation in order to rebound from the sales dip.

“We have reduced inventory by 27% year-on-year and with this focus on careful inventory management, strong cost control and cash management, we will continue to drive operational and cost efficiency across the business,” Lyttle added.

“The group has continued to invest in key strategic priorities that will enable future growth, and the progress made gives us confidence that as macroeconomic headwinds ease it will be well-positioned to rebound strongly."