The logo of Swedish clothing retailer H&M hangs in one of its stores on March 28, 2018 in Berlin, Germany.
Sean Gallup Getty Images News | Getty Images
Shares in H&M fell 7% on Thursday after the world’s second-biggest fashion retailer posted an operating profit that missed its earnings margin target.
The Swedish fashion retailer reported that operating profit for the group’s fiscal third quarter came in at 3.51 billion Swedish crowns ($345.8 million), compared with 4.74 billion Swedish crowns a year ago. Analysts surveyed by LSEG had estimated operating profit of 4.93 billion, Reuters reported.
H&M said it had lowered its profit margin target for 2024 after warning of more challenging conditions earlier in the year.
“External factors have caused sales revenue and purchase costs more than expected. We now estimate that this year’s operating margin will be lower than 10 percent,” said Daniel Ervér, H&M’s executive director, in a written statement.
“We are confident that our plan will increase sales and profits,” he said.
Shares of H&M fell sharply on the news. The Stockholm-listed company was one of the worst-performing stocks on the pan-European Stoxx 600 in morning trading.
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