Inditex faces share price plunge amid sales slowdown warning

In Spain, Inditex, the parent company of Zara, experienced a significant dip in its share price on March 12, 2025, falling 7.5% to its lowest point in seven months. This decline followed the announcement of fourth-quarter earnings that showed a year-on-year rise in sales but also highlighted a slowdown in sales growth at the beginning of the year. The company posted revenues of 11.21 billion euros, meeting analyst expectations, and reported a net income of 1.42 billion euros. However, it noted that between February 1 and March 10, sales growth had dropped to 4%, a stark contrast to the prior year's 11% growth. Investors expressed concern regarding consumer sentiment and economic conditions, which were deemed volatile. The market reacted negatively to these indicators, leading to a questioning of whether the slowdown represents merely a temporary fluctuation or the onset of a more lasting decline in consumer confidence. This uncertainty has implications not just for Inditex, but for the retail sector at large, as other major retailers also saw declines in their stock prices on the same day, reflecting a broader anxiety about consumer spending trends amid challenging economic circumstances. Moreover, despite the mixed signals, Inditex remained optimistic about its overall sales strategy going forward and attributed some growth to successful brand performance, including online sales and strong growth in certain brands like Bershka and Stradivarius. Nevertheless, the company is navigating complexities associated with U.S. tariffs and fluctuating consumer confidence amid changing economic conditions.