RE: To the moon19 Dec 2025 13:27
New commercial model enabling gross margin expansion: Adjusted gross margin up 370bps YoY to more than 47%, on track for 50% mid-term target, driven by higher full-price sales mix and lower markdown activity.
· Strategic models scaling, delivering trends faster: Test & React (T&R) successfully scaled to more than 20% of own brand sales, with broader speed to market initiatives reducing own brand production times by up to c.30% YoY.
· Partner brand product portfolio transformed: c.100 new partner brands launched during FY25 and exclusive collaborations such as adidas x ASOS. Flexible Fulfilment (FF) models scaled to more than 10% of third-party GMV by year-end, including the transition of Inditex to an AFS model, bringing working capital benefits and customers greater product availability.
· Operational efficiencies driving cost savings and creating investment capacity: Supply chain costs down c.20% YoY, through a series of wide-ranging initiatives including reducing the causes of unnecessary returns, renegotiation of key distribution contracts and optimising warehouse footprint. In H2, further meaningful cost actions were delivered which position ASOS to realise significant annualised savings in FY26, creating headroom to reinvest in growth.
· Adjusted EBITDA up more than 60%, amidst lower sales: Adjusted EBITDA of £132m delivered within guidance range, resulting in a 250bps YoY margin improvement to 5.3%. Profitability improvement delivered despite lower than expected GMV, as ASOS continues to focus on higher quality sales against a soft consumer backdrop.
· Improving customer engagement and profitability: Despite overall lower customer volumes in FY25, retention rates improved, especially among profitable customers, with increased average spend and profitability. Year-to-date in FY26, seeing an encouraging improvement in customer engagement, including new customers up c.10% YoY in the UK.
· Balance sheet significantly strengthened: Net debt down more than £110m YoY, through convertible bond refinancing and proceeds from the formation of the TSTM joint venture6 in Q1 FY25. Financial flexibility further improved through term loan refinancing in Q1 FY26, bringing improved financial terms including £87.5m additional liquidity headroom and extended maturity.
· Free cash inflow: Delivered £14m FCF in FY25, driven by growth in adjusted EBITDA and focus on capital efficiency.
· Exciting pipeline of inspirational experiences: First wave included successful launch of ASOS.WORLD loyalty programme, new AI outfits 'Styled for you' feature, and ASOS Live immersive shopping. Into FY26, focus shifts to re-engaging customers through a series of meaningful improvements that fundamentally enhance what shopping on ASOS feels like.
· Successful relaunch of iconic Topshop brands: Bringing customers more ways to shop the best of Topshop and Topman (TSTM) through the relaunch of Topshop.com in August, and new wholesale partnersh
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