Nelly Group (NELLY) Q1 2025 earnings summary

Executive summary

• Achieved strong Q1 2025 results with 11.5% net revenue growth to SEK 247.8 million and operating margin of 8%, marking the eighth consecutive profitable quarter.

• Gross margin improved to 51.6% from 49.1%, with operating profit at SEK 19.9 million (up from SEK 1.4 million).

• Profit after tax reached SEK 16.3 million, reversing a loss of SEK -1.9 million in Q1 2024.

• Positive trends in new customer recruitment, active customer base, and own brand development.

• Return rate dropped to 24.8% from 33.4%, reflecting successful returns management and physical store contribution.

Financial highlights

• Net revenue: SEK 247.8 million (up 11.5% year-over-year from SEK 222.2 million).

• Gross profit: SEK 127.8 million, gross margin 51.6% (up from 49.1%).

• Operating profit: SEK 19.9 million (8.0% margin, up from 0.6%).

• Profit after tax: SEK 16.3 million (SEK -1.9 million Q1 2024), EPS SEK 0.54.

• Cash and cash equivalents: SEK 172.6 million as of March 31, 2025.

Outlook and guidance

• Focus on elevating customer experience, increasing conversion and basket size, and further own brand and external brand collaborations.

• Ongoing investments in IT systems and moving returns handling in-house to improve control and lead times.

• No decision yet on opening additional physical stores beyond Stockholm flagship.

• IT system upgrades prioritized for 2025.