The online fashion retailer ASOS, long considered a problem child in its sector, has delivered a powerful signal that its rigorous restructuring plan is yielding results. Interim figures for the first half of 2026, released on Wednesday, revealed a substantial leap in profitability that comfortably surpassed market expectations, even as sales volumes contracted.
Profitability Trumps Sales Volume
Investors responded with marked enthusiasm to the turnaround progress, sending the company’s shares soaring by 15.53% to €2.89 in today’s trading. This rally puts significant distance between the current price and the 52-week low of €2.50 recorded just the day before. The confidence is underpinned by the company’s reaffirmed full-year outlook.
A closer examination of the financial statements reveals an unusual dynamic. The company achieved a 50% increase in adjusted EBITDA year-on-year, despite a 9% decline in Gross Merchandise Value (GMV). This apparent contradiction is explained by a steadfast focus on operational efficiency. ASOS reduced its fixed costs by over 10% and elevated its adjusted gross margin to 48.5%, representing an improvement of 330 basis points.
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Strategic Shift and Confirmed Guidance
This performance was driven primarily by a strategic pivot toward higher-margin segments. Management highlighted that growth in its womenswear division accelerated by ten percentage points compared to the second half of 2025. Market observers interpret this as a crucial indicator of a potential revenue trend reversal.
For the full financial year ending August 31, 2026, ASOS continues to project an adjusted EBITDA in the range of £150 million to £180 million. This compares to a result of £131.6 million for the prior year. Furthermore, the company aims to stabilize its gross margin permanently within a 48% to 50% band.
The Path Ahead
The critical focus for the coming months will be whether the growth momentum in womenswear can be sustained. The company’s objective is to return to a position where its trading volume grows faster than its net sales. The next major update for investors is scheduled following the close of the financial year on August 31, 2026.
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