Digital platform growth drives Farfetch's Q3

Farfetch Limited’s GMV increased by 219.5 million dollars to 1,017.3 million dollars in third quarter, representing growth of 27.5 percent. Digital platform GMV increased by 154.4 million dollars to 828.5 million dollars, up 22.9 percent.

Revenue for the quarter increased by 144.9 million dollars to 582.6 million dollars, representing growth of 33.1 percent. The increase, Farfetch said, was primarily driven by 26.5 percent growth in digital platform revenue to 397.1 million dollars and growth in brand platform revenue of 47.2 percent to 165.3 million dollars.

Digital platform GMV growth on a two-year basis accelerated sequentially from 89 percent in Q2 2021 to 97 percent in Q3 2021, led by key luxury markets including the United States, Mainland China, United Kingdom, Middle East, Germany and Russia, which more than doubled in two years.

Commenting on the company’s performance, José Neves, Farfetch founder, chairman and CEO said: “I’m thrilled by Farfetch’s continued track record of delivering aggressive market share capture as we accelerated two-year stack digital platform GMV growth to 97 percent in the third quarter, and remain on track to achieve our goal of full year adjusted EBITDA profitability and GMV growth above our long-term 30 percent CAGR target.”

Review of Farfetch’s Q3 results

The company’s digital platform services revenue increased 21.4 percent, driven by 22.9 percent overall growth in digital platform GMV with digital platform services first-party GMV, which includes first-party original, increasing 26.3 percent to 133.7 million dollars.

Digital platform fulfilment revenue increased 53 percent year-over-year, above digital platform GMV growth of 22.9 percent driven by increased pass-through costs resulting from higher duties due to a shift in regional mix of sales and continued impacts of Brexit, which we expect to be ongoing. Brand platform revenue increased by 47.2 percent to 165.3 million dollars due to the same factors driving brand platform GMV growth. In-store revenue increased by 76.6 percent to 20.2 million dollars.

Profit after tax increased by 1,306.1 million dollars from a loss of 537 million dollars to a profit of 769.1 million dollars in third quarter 2021. Basic EPS was 2.09 dollars and diluted EPS was negative 25 cents. Adjusted EBITDA improved by 15.6 million dollars to 5.3 million dollars in third quarter 2021, while adjusted EBITDA margin improved from negative 2.7 percent to 1.1 percent.

Farfetch reveals expectations for full year 2021

Farfetch’s expects digital platform GMV growth of approximately 33 percent year-over-year for the full year and adjusted EBITDA of approximately 5 million dollars.

For fourth quarter, the company expects digital platform GMV growth of 18 percent to 22 percent, brand platform GMV growth of 20 percent to 25 percent and adjusted EBITDA of approximately 40 million dollars.