Is fast fashion starting to peak? After slowing sales numbers lead to closures of Uniqlo stores earlier this year, H&M released its first half-year report of 2016 on Wednesday, and the numbers are not what they once were.
Blaming cold spring weather and a strong U.S. dollar for a slow second quarter, H&M CEO Karl-Johan Persson says, "The sales increase in March and April was significantly below our plan." Sales were up just 5 percent for the second quarter — the weakest in three years — with profit reaching about 7 billion kronor ($850 million). That's quite a bit less than the company's projected 7.23 billion kronor. This follows a steep decline in profit for the first quarter of the year.
Of course, it's not all bad news for the fast fashion sector: H&M rival Zara is experiencing huge global sales increases, perhaps due to its ability to turn inventory around more quickly as climate demands it. Uniqlo, though it may not be growing as rapidly as it hoped, recently brought on Christophe Lemaire to serve as artistic director. H&M still plans to complete its roll out of 425 new stores this year, in addition to expanding e-commerce into new markets: Canada and South Korea will be next.