Farfetch, the luxury online fashion platform, has reported its Q3 results, revealing significant growth in gross merchandise value (GMV) and digital platform GMV. Comparing the same period last year, the company saw a 62% increase in GMV and a 60% increase in digital platform GMV, reaching record highs of $798 million and $674 million respectively. However, Farfetch also reported a loss of $537 million after tax, surpassing the $90 million loss from the previous year. On a positive note, its adjusted EBITDA improved to a loss of $10 million compared to $36 million in the previous year.

The increase in digital platform GMV can be attributed to a surge in sales across all three major regions – the Americas, EMEA, and APAC. Additionally, Farfetch’s top five countries experienced faster growth compared to the previous quarter. The company credits the recovery of average order value (AOV) as a contributing factor to its growth, with a year-on-year change of -1% compared to a -18% change in Q2. The sales of full-priced and higher-priced items drove this AOV recovery.

Farfetch also highlighted the rise in customer engagement, reporting a 45% increase in active consumers and over 70% growth in app installs. The company’s mobile app has become a preferred channel for consumers. Furthermore, Farfetch expanded its reach by partnering with new e-concession brands, including Moncler, Dolce & Gabbana, Ralph Lauren, and Rado. The collaboration with Rado marks Farfetch’s first e-concession with the Swatch Group.

As a brand owner, Farfetch experienced strong growth in its brand platform GMV and revenue, with figures rising from $67.3 million to $112.3 million. In-store GMV also saw an increase from $9 million to $11.4 million. Notably, Farfetch’s directly owned brands, such as Off-White and Palm Angels, outperformed any other single brand on the Farfetch Marketplace for the sixth consecutive quarter. Palm Angels even became one of the top 10 brands on the platform.

Farfetch CEO José Neves celebrated the Q3 results, considering it a record-breaking period and highlighting the shift toward online luxury. Neves believes that Farfetch is not only capitalizing on this shift but also leading it for luxury consumers and brands. He views the luxury industry as an underutilized market with immense potential for online adoption. With the recent partnership with Alibaba and Richemont, Neves is confident that Farfetch is well-positioned to propel the luxury industry into the next generation, ensuring long-term growth and market share.

The collaboration with Alibaba and Richemont entails launching Farfetch luxury shopping channels on Tmall Luxury Pavilion and Luxury Soho. Under this arrangement, the new China joint venture will own 75% of Farfetch, with Alibaba and Richemont each owning 12.5%. This strategic move strengthens Farfetch’s presence in the Chinese market and sets the groundwork for further expansion and growth.

Useful links:
1. Farfetch official website
2. Alibaba Group official website