Inditex shares drop as sales disappoint

Shares in Zara owner Inditex fell Wednesday after the world's biggest fashion retailer posted disappointing first quarter sales as concerns mount over US President Donald Trump's trade war.

The Spanish group -- whose other brands include Massimo Dutti, Bershka and Pull&Bear -- posted a profit after tax of 1.3 billion euros ($1.1 billion) for the three-month period ending April 30, up 0.8 percent from a year ago.

It was a new record for the first quarter and in line with the average forecast by analysts surveyed by the FactSet financial data firm.

But the pace was slower than that which Inditex has been used to in recent years since the end of the Covid crisis.

Sales grew 1.5 percent to 8.27 billion euros over the same period, which is typically a slower time of the year for the sector. The figure was lower than the 8.37 billion euros forecast by FactSet.

"Sales are slowing more than expected," analysts at Bankinter said in a note, describing the results as "soft".

Sales in the start of the second quarter remained slow: They increased by six percent from May 1 to June 19, down from 12 percent growth in the same period a year ago.

"Inditex missed operational forecasts," said Renta4 analyst Ivan San Felix.

Inditex did not give a reason for the slower sales growth, saying in a statement it had posted a "solid operational performance led by the creativity of our teams and the strong execution of the fully integrated business model".

Shares in Inditex fell 3.25 percent in late morning trade to 47.61 euros. The Ibex-35 index of most traded Spanish shares was down just 0.37 percent.

Countries and companies around the world have had to navigate Trump's tariffs onslaught, which he launched on April 2.

The US president has imposed 10 percent tariffs on goods imported from around the world, and threatened to hit the European Union and dozens of other countries with even higher duties in July.