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TOKYO (Reuters) – SoftBank-backed online fashion retailer Zozo Inc’s (T:3092) shares closed up 21% on Friday in their largest single-session gain, a day after reporting a 34% jump in first-quarter operating profit as Japanese consumers embrace online shopping.
The results are a bright spot in a fashion industry hammered by the coronavirus outbreak as consumers stay home, benefiting from brands shifting unsold inventory to the site.
The profit growth is a tailwind for CEO Kotaro Sawada, who took over from flamboyant founder Yusaku Maezawa after the sale to SoftBank Group (T:9984), which exerts control via its domestic internet business Z Holdings (T:4689).
Maezawa pushed Zozo into the headlines with splashy but unsuccessful ventures like the Zozosuit body measuring suit but alienated key business partners. Tenants like Onward Holdings (T:8016) have returned to the site under the new management.
SoftBank is making a major push into ecommerce with Amazon (O:AMZN) and Rakuten (T:4755) contender PayPay Mall. The site also features Zozo, which hopes to bring in new customers beyond its fashion-loving base.
Zozo sees full year gross merchandise value, a measure of transaction volumes, rising 12% year-on-year to 387 billion yen, with operating profit seen rising 42% to 40 billion yen.
