© Reuters. Farfetch Limited (FTCH) shares plummet on 2023, 2025 guidance
Farfetch Limited (FTCH) shares crashed during Thursday’s session after the company announced its financial forecasts for 2023 and 2025, disappointing investors.
The company announced the forecasts on its capital markets day. Farfetch’s shares have plunged more than 34% following the announcement, adding to its significant losses already this year.
For 2023 the company sees Gross Merchandise Value (GMV) of $4.9 billion. It represents a forecasted increase of approximately 20% to 22% year-on-year from the company’s full-year 2022 outlook. Farfetch sees GMV in 2023 driven by the growth of the underlying business of 8% to 10% and GMV from signed partnerships of approximately $500 million.
2023 adjusted EBITDA Margin is seen between 1% to 3%, an increase from the company’s outlook of (3)% to (5)% in 2022, driven by improved Gross Profit and Order Contribution margins in addition to operating cost efficiencies of approximately $85 million. However, it will be partially offset by $170 million in costs to support new partnerships.
In its 2025 forecast, the company said it sees adjusted revenue at approximately $3.5 billion, with GMV of roughly $10 billion.
In addition, Gross Profit Margin, as a percentage of adjusted revenue, is forecasted to be approximately 60%, while adjusted EBITDA margin is predicted to be 10%, driven by order contribution margin performance and the scaling of operating costs.
By Sam Boughedda
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