Zalando Closes 2025 Strongly, Forecasts Acceleration in 2026

European fashion and lifestyle technology platform Zalando has reported strong business results for 2025, posting double-digit growth across its key metrics and setting out ambitious plans for 2026. The company also made it clear that it sees future growth in the broader use of artificial intelligence, accelerated synergies following the acquisition of ABOUT YOU, and stronger shareholder returns through a share buy-back programme of up to €300 million.

According to the published figures, gross merchandise volume, or GMV, rose 14.7% to €17.6 billion, while revenue increased 16.8% to €12.3 billion. Adjusted earnings before interest and taxes climbed 15.6% to €591 million. At the group level, the adjusted EBIT margin remained stable at 4.8%, while Zalando’s stand-alone margin expanded to 5.3%.

The company said the results were delivered at the upper end of its previously upgraded 2025 guidance, which had been revised following the successful completion of the ABOUT YOU acquisition. Management now expects a further acceleration in 2026, with one of the main drivers being the broader use of artificial intelligence across the entire business.

During 2025, Zalando used AI to improve efficiency in marketing, logistics, and software development. In marketing content production, the share of AI-generated product content rose from almost zero to 90% in just one year, cutting campaign creation times from six weeks to just a few days and increasing content output by 70%. In logistics, advanced AI models improved the accuracy of delivery time estimates by 22 percentage points, while the use of AI coding tools among around 3,000 technology specialists resulted in more than 20% more code changes.

For 2026, the company is placing particular emphasis on personalisation and on improving the precision with which customers are matched with products, content, and the right sizes. Its proprietary artificial intelligence foundation models, Zalando says, have already driven a 13% increase in the number of items added to shopping baskets. At the same time, its Size & Fit solutions, based on real body measurements from more than one million customers, have reduced size-related returns by more than 8%.

At the same time, Zalando is developing a new, conversational way to shop online. Its Zalando Assistant is evolving into a personal lifestyle companion, and the number of users engaging with it has risen to 6 million, up from 1.5 million a year earlier. The company also sees additional potential in so-called agentic commerce, meaning shopping through AI assistants and chatbots. As one of only two European launch partners for Google’s Universal Commerce Protocol, Zalando is laying the groundwork for the direct discovery and purchase of fashion and lifestyle products through AI chatbots such as Gemini.

In the B2C segment, the group reached a record 62 million active customers in 2025. It sees the key to this growth in its multi-app strategy, which includes the main Zalando app, the trend-focused ABOUT YOU app, and Lounge by Zalando for deals and promotions. The company says this approach enables broader market reach, more frequent user engagement, and a larger share of customers’ total lifestyle spending.

Customer loyalty also provided an additional boost. The Plus programme is now available in 17 markets, with 16.8 million members, and generated nearly half of fourth-quarter GMV. The new AI-powered discovery feed is already being used by more than nine million weekly users, as the platform seeks to evolve from a purely transactional model into a daily lifestyle companion. This stronger engagement with users also helped drive 42% growth in Zalando’s retail media business in 2025.

The company also continued to expand categories beyond traditional fashion. Segments such as sports, beauty, kids and family, and designer products grew 13%, with the sports category receiving particular attention, including a five-year partnership with the German Football Association and sponsorships of leading European marathons.

Strong growth continued in the B2B segment as well, where Zalando is building an operating system for fashion and lifestyle e-commerce. Revenue rose 14.6% to more than €1.1 billion, while adjusted EBIT more than doubled. The modular system, which includes ZEOS for logistics, SCAYLE for commerce and marketplace software, and Tradebyte for marketplace integration, now serves more than 1,200 merchants and supports around €11 billion in GMV.

One of the biggest steps forward in this segment is the new global partnership between SCAYLE and Levi’s. Under the deal, SCAYLE will become the global commerce platform for Levi.com in the United States, Canada, and Europe, which Zalando sees as an important breakthrough in the US SaaS market. The company also highlighted the logistics partnership between ZEOS and UK retailer Next, which in 2025 helped the retailer increase international online sales by 33% while reducing fulfilment costs by 6.5%.

For the 2026 financial year, the group expects GMV and revenue growth of 12-17%, while adjusted EBIT is projected to range from €660 million to €740 million. Faster delivery of synergies following the ABOUT YOU transaction has also led to a revised timeline, with Zalando now expecting to achieve its targeted €100 million in synergies by 2028, one year earlier than originally planned.

At the same time, the company has reaffirmed its medium-term targets for 2028. Following the acquisition of ABOUT YOU, the combined group expects compound annual growth rates of 8 to 13% for both revenue and GMV from 2023 to 2028, with an adjusted EBIT margin target of 6 to 8%.

On the back of strong results, a healthy balance sheet, and robust cash flow, Zalando has also announced a share buy-back programme of up to €300 million, equivalent to approximately 5% of outstanding shares. The buy-back will be financed from the company’s existing cash position, and the repurchased shares are expected to be cancelled. Simultaneously, the company will continue to invest between €240 million and €300 million in capital expenditure in its technology platform and infrastructure as it looks to increase its share of Europe’s €500 billion fashion market.

The company’s leadership said the 2025 results confirm its ability to deliver on strategy, while 2026 is expected to mark another major phase of profitable growth. With a stronger reliance on artificial intelligence, the integration of ABOUT YOU, and the expansion of its B2B operations, Zalando aims to further strengthen its position as Europe’s leading fashion and lifestyle platform.