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Zalando reported third-quarter revenues shrank 3.2 percent to 2.27 billion euros amid “low consumer sentiment,” declining online sales and the warmest September on record in Europe.

Gross merchandise value, or GMV, declined 2.4 percent to 3.2 billion euros in the three months ended Sept. 30.

The German e-commerce giant also dialed down GMV and revenue guidance “on expectation of continued pressure on demand for the rest of the year.”

It now expects GVM to amount to between -2 percent and +1 percent and revenue to contract between 3 percent and 0.5 percent in 2023. Previously, the company had expected GMV and revenue to come in at the lower half of the guidance ranges of 1-7 percent for GMV and -1 percent to +4 percent for revenue.

On the plus side, the company reported gains in profitability by containing fulfillment costs, even as pressures on gross margin continue.

It said adjusted EBIT in Q3 zoomed 72 percent to 23.2 million euros, and noted full-year guidance for adjusted EBIT would be maintained at between 300 million euros and 350 million euros.

To meet a plethora of headwinds, Zalando said it is “laying further foundations for future growth with strategic initiatives such as inspiring customers with new content and storytelling formats, introducing a luxury boutique-style space in Fashion Store to improve the experience for designer brands and customers, and growing the company’s logistics offering.”

In a research note, RBC Capital Markets’ analyst Wassachon Udomsilpa noted the numbers came in a touch below consensus. “We believe Zalando’s growth performance improved in October, given improving weather conditions,” she added.

Last month, Zalando launched a B2B brand ZEOS, an acronym for Zalando E-commerce Operating System, that allows brands and retailers to manage their multi-channel business across Europe within one platform.

“Storytelling, logistics and technology are key to boost our future growth. Our healthy balance sheet gives us the financial flexibility to make these strategic investments,” Sandra Dembeck, Zalando’s chief financial officer, said in a statement. “On top of that, our financial discipline meant that we were able to deliver on another quarter of improved profitability.”

The company is to host a conference call at 9:30 a.m. CET.