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Digital fashion market struggles as Myntra reports revenue contraction in FY26

India’s digital fashion market is grappling with rising marketing overheads and structural shifts in fulfillment unit economics. As per financial disclosures from premier fashion e-tailer Myntra, the company’s operational revenue contracted by 13.5 per cent to Rs 5,242.5 crore in FY26, alongside a bottom-line reversal to a net loss of Rs 579.4 crore. A primary reason behind this margin compression is a 53.2 per cent decline in internal logistics services income, coupled with customer acquisition expenses that expanded 10.5 per cent to Rs 2,326.5 crore - accounting for 41 per cent of overall operational expenditure.

Digital fashion retail is experiencing a fundamental rebalancing where customer acquisition yields are diminishing relative to historical marketing investments, notes Vikram Desai, Senior Retail Analyst,Capital Insights. To regain profitability, platforms must align ad expenditure with core marketplace monetization rather than relying on volume-driven logistics scale, he adds.

Unit economics challenge platform profitability metrics

In FY26, Myntra spent Rs 1.10 to generate each rupee of revenue, dragging EBITDA margins to -7.09 per cent. Although marketplace commissions held steady at 50.7 per cent of operational earnings, aggressive ad-tech spending nearly doubled the platform’s advertising revenue of Rs 1,236.4 crore, highlighting the financial friction in driving top-line growth across competitive retail corridors.

Targeting 100 million active consumers

A subsidiary of Flipkart, Bengaluru-based Myntra leads India’s fashion e-commerce market across apparel, footwear, and beauty. Founded in 2007 as a personalized gift portal, it evolved into an apparel powerhouse targeting 100 million active consumers through international brand onboarding and quick-commerce pilots, balancing Rs 5,242 crore in operating revenue against ongoing margin pressure.

Digital fashion market struggles as Myntra reports revenue contraction in FY26

Shoppers Stop posts Rs 6 cr profit as beauty sales grows

Shoppers Stop returned to black in the July-September quarter, supported by tighter inventory management, higher premium spending and strong beauty sales, even as reported same-store sales growth slowed amid a shift in the festive calendar.

The department store retailer reported consolidated net profit of Rs 6 crore, against a net loss of Rs 7 crore in the year-ago quarter. Consolidated gross retail turnover rose 7 per cent year-on-year to Rs 1,618 crore, while statutory revenue from operations increased 8.7 per cent to Rs 1,370 crore.

Operating EBITDA climbed 55.8 per cent to Rs 43 crore from Rs 27.6 crore, reflecting tighter operating controls and improved inventory efficiency. The company also reduced outright inventory by Rs 78 crore and net debt by Rs 82 crore, advancing its stated goal of becoming net-debt free.

 

Festive shift masks growth

Reported same-store sales growth (SSSG) moderated to 2 per cent, compared to 6 per cent in the preceding quarter and 9.4 per cent a year earlier. The slowdown was partly attributable to the festive calendar, which shifted key Durga Puja, Navratri and Diwali purchases into the September quarter. On a festive-adjusted like-for-like basis, sales growth stood at 7 per cent, indicating stronger underlying demand than the headline SSSG figure suggests.

The distinction is important for department store operators, whose quarterly performance is sensitive to the timing of festive purchases. However, the adjustment does not eliminate the broader challenge of uneven discretionary spending, particularly among middle-income consumers.

Shoppers Stop’s share price fell 5.4 per cent to Rs 363.15 following the results, reflecting market concerns over the reported slowdown.

Table: Shoppers Stop quarterly results

Operating & financial details

Year ago quarter

Latest quarter (Q2)

Change

Consolidated Gross Revenue

Rs 1,512 Cr

Rs 1,618 Cr

+7.0%

Revenue from Operations (Ind-AS)

Rs 1,260 Cr

Rs 1,370 Cr

+8.7%

Consolidated Operating EBITDA

Rs 27.6 Cr

Rs 43.0 Cr

+55.8%

Consolidated Net Profit / (Loss)

(Rs 7.0 Cr)

Rs 6.0 Cr

Operating turnaround (+Rs 13 Cr)

Same-Store Sales Growth (Reported)

9.40%

2.00%

Moderated by calendar timing

Like-for-Like (Festive-Adjusted)

Baseline

7.00%

Underlying baseline resilience

Outright Inventory Compression

Baseline

Down Rs 78 Cr

Strict working capital release

Net Debt Reduction

Baseline

Down Rs 82 Cr

Target: Net-debt free by Q3

Department Store Format Sales

Rs 1,252 Cr

Rs 1,302 Cr

+4.0% (7% Festive LFL)

Dedicated Beauty Category Sales

Rs 311 Cr

Rs 367 Cr

+18.0%

Global SS Beauty Distribution

Rs 105 Cr

Rs 168 Cr

+59.0% (All-time quarterly high)

INTUNE Value-Fashion Revenue

Rs 68 Cr

Rs 72 Cr

+6% Festive LFL

Note: Gross retail turnover and statutory revenue from operations are different accounting measures and should not be treated as interchangeable.

 

Premium sales lift ticket values

The department store business generated Rs 1,302 crore in sales, up 4 per cent year-on-year. On a festive-adjusted basis, like-for-like growth reached 7 per cent. Growth was accompanied by higher customer spending per transaction. The average selling price rose 9 per cent to Rs 1,903, while average transaction value increased 8 per cent to Rs 5,527. Items per transaction remained unchanged at 2.9.

The figures suggest that higher price realisation, rather than an increase in the number of items purchased, supported sales growth. This places greater importance on premium merchandise, brand mix and full-price selling as retailers seek to protect margins in a price-sensitive market.

Premium brands accounted for 73 per cent of department store sales, with the contribution reportedly expanding by 390 basis points year-on-year. Shoppers Stop also reduced inventory in its private apparel labels by 26 per cent, while increasing selected higher-priced offerings, including its Bandeya ethnicwear range and Fratini Girl collection.

 

Beauty leads growth

Beauty remained the strongest growth category. Dedicated beauty retail sales rose 18 per cent to Rs 367 crore, with fragrance demand increasing 35 per cent. Global SS Beauty Brands, the company's distribution business, recorded quarterly sales of Rs 168 crore, up 59 per cent and its highest quarterly level to date. The performance highlights the contribution of prestige beauty and fragrance to the retailer's wider portfolio.

Shoppers Stop continued to expand its luxury beauty presence through dedicated boutiques for fragrance brand CREED in New Delhi and Japanese skincare label Shiseido in Bengaluru. It also undertook a nationwide Versace Crystal Emerald activation across 400 touchpoints.

The company has been consolidating its digital operations by integrating the standalone SSBeauty.in portal into its primary online storefront. This move helped reduce operating losses associated with the digital business by ₹8 crore during the quarter, according to the supplied figures.

Hard to ignore

Loyalty drives repeat sales

Customer retention remains central to Shoppers Stop's strategy. Its First Citizen programme has 14 million registered members, who contributed 84 per cent of overall sales during the quarter.

The premium Black Card segment added 40,000 members, with enrolments rising 24 per cent year-on-year. Black Card customers recorded a 66 per cent repeat-purchase rate and contributed 22 per cent of total retail sales.

A co-branded credit card partnership with RBL Bank adds reward points, airport lounge access and dedicated personal shopping facilities to the loyalty proposition. The strategy is designed to encourage repeat spending among high-value customers rather than relying exclusively on costly customer acquisition.

Refer

Expansion stays measured

Shoppers Stop spent Rs 39 crore on capital expenditure during the quarter, opening four department stores, two beauty boutiques and one MAC shop-in-shop. First-half additions reached 15 outlets, with capital expenditure of Rs 83 crore.

Its value-fashion format, INTUNE, generated Rs 72 crore in revenue and recorded 6 per cent festive-adjusted like-for-like growth. Inventory reductions of Rs 33 crore in the format also supported working capital discipline.

Despite the operating improvement, financial pressures remain. Finance costs stood at Rs 74.7 crore, leaving limited room for error as the retailer navigates the post-festive period. Rising occupancy costs and competition across apparel and beauty could further constrain profitability.

The next phase of the turnaround will depend on sustaining sales growth without excessive discounting, maintaining inventory productivity and converting working capital savings into durable cash-flow improvement. Achieving net-debt-free status will be a key test of whether the latest quarter marks a sustained recovery rather than a temporary improvement.

Easitex-Textiles Sustainability

Shoppers Stop posts Rs 6 cr profit as beauty sales grows

Ad monetization rises by 35% as fashion retailer rebalances growth engines

India’s digital apparel landscape is witnessing a structural shift in e-commerce unit economics. Platform ad monetization is emerging as a critical margin cushion while primary logistics top-lines contract.

VIEW

Platform monetization counters operational drag

Myntra’s operating revenue declined by 13.5 per cent Y-o-Y to Rs 5,242.5 crore in FY26, largely dragged down by a 53.2 per cent contraction in logistics services income to Rs 1,119.2 crore.However, the fashion marketplace expanded its high-margin retail media engine.In-app advertising and seller promotional revenue increased by 35.2 per cent to Rs 1,236.4 crore, now accounting for 23.6 per cent of total operational revenues.Marketplace commissions also sustained steady momentum, rising 3 per cent to Rs 2,657.3 crore.

Hard to ignore

Marketing intensity escalates profitability pressures

To defend market share against emerging quick-commerce fashion channels and specialized D2C players, the platform allocated Rs 2,326.5 crore toward advertising and business promotions - a 10.5 per cent uptick.Marketing expenses absorbed 41 per cent of total operational costs.Consequently, lower logistics volumes coupled with sustained promotional intensity pushed the retailer into an EBITDA loss of Rs 435 crore, alongside a net loss of Rs 579.4 crore for the fiscal year.

Industry analysts note, while pure-play fulfillment income is rationalizing across major fashion platforms, retail ad network expansion offers an avenue for structural margin recovery as brand partnerships deepen.

Refer

Market footprint & outlook

Flipkart-owned Myntra is a premier Indian e-commerce marketplace specializing in fashion, beauty, and lifestyle categories. Founded in 2007 as a personalized gift portal, it expanded into a fashion aggregator before its acquisition in 2014. The company targets Tier-I to Tier-III markets, expanding its international brand catalogue, private labels, and quick-delivery fashion verticals.

Despite current FY26 operational headwinds, long-term growth plans center on monetizing vendor advertising and deepening platform brand partnerships.

Easitex-Textiles Sustainability

Ad monetization rises by 35% as fashion retailer rebalances growth engines

Neeman’s to capture footwear segment growth in India with new store openings

Direct-to-consumer sustainable footwear label Neeman’s is expanding its retail presence by increasing its EBO count across India from 50 to 500. The brand generated over Rs 185 crore in annual revenue in FY25 which it aims to increase to Rs 1,000 crore over the next three years. The strategy reflects a broader trend among digital-native footwear players transitioning toward physical retail to mitigate escalating customer acquisition costs on digital platforms and improve brand visibility across high-street and shopping mall corridors.

Deepening penetration across regional consumer hubs

The brick-and-mortar push prioritizes Tier-I & II urban markets, where consumer demand for ergonomic and eco-friendly casual footwear is accelerating. By balancing its product portfolio between core merino wool sneakers and lightweight synthetic daily wear, Neeman’s aims to double its run-rate to Rs 350 crore by March 2027. The brand is creating an infrastructure to support long-term sustainable expansion ranging from strengthening their product engine and supply chain to investing in physical execution, states Amar Preet Singh, Co-founder and COO, Neeman’s.

Managing capital allocation amid physical expansion

Executing a 500-store physical network presents operational hurdles, including rising commercial real estate lease rates and inventory management across widespread geographical nodes. However, localized fulfillment and store-level profitability models offer strong margin protection. Neeman's transition underlines how hybrid retail architectures are becoming mandatory for modern consumer brands seeking long-term commercial viability in India's fragmented footwear market.

Creating footwear from natural and recycled materials

Neeman's is an Indian sustainable footwear brand manufacturing eco-friendly casual shoes and athletic wear made from natural and recycled materials. Operating online and through retail outlets in metro and Tier-1 hubs, it aims for Rs 1,000 crore revenue via 500 new stores, supported by Rs 185 crore in recent top-line sales since its 2018 launch.

Neeman’s to capture footwear segment growth in India with new store openings

Myntra strengthens leadership to expand private labels

Myntra has expanded its senior management framework by appointing Jayant Prasad as Senior Director-Brand Management. Bringing over two decades of commercial experience across menswear, product development, and multi-channel retail operations, Prasad steps into overseeing buying and design functions specifically across private-label and licensed western wear and sportswear lines. His prior leadership record includes sustained tenures at Arvind Fashions and Aditya Birla Fashion and Retail (ABFRL), where he executed channel development strategies for major apparel labels.

MUCH MORE

Market expansion via direct brand equity

The strategic appointment signals a broader push by fashion platforms to elevate direct-to-consumer and in-house merchandise margins. Industry dynamics indicate, proprietary digital labels yield higher gross margins than third-party vendor listings, making executive sourcing and product creation expertise vital for sustainable growth.

Scaling proprietary fashion architecture requires blending deep supply chain expertise with real-time consumer intelligence, says Rohit Sharma, Principal Consultant, Fashion Commerce Advisory. Apparel platforms are treating in-house portfolio building as a primary levers for unit economics optimization, he adds.

Refer

A market-leading digital fashion destination

Myntra operates as India's premier online fashion and lifestyle platform, specializing in apparel, footwear, beauty, and accessories. Targeting urban and regional fashion consumers, the platform aggressively expands its private-label portfolio alongside international licensed brands. Achieved profitability on a monthly EBITDA level while sustaining double-digit revenue expansion in FY26. Originally founded in 2007 as a B2B personalization business, the venture evolved into a market-leading digital fashion destination.

Easitex-Textiles Sustainability

Myntra strengthens leadership to expand private labels

Uniqlo India strengthens market position as FY26 net profit rises to Rs 253 crore

Uniqlo continues to strengthen its position in India's competitive apparel market as Japanese global fashion retailer registered a 41 per cent rise in net profit to Rs 253 crore in FY26 ended March 2026 as against Rs 180 crore registered in FY25. Driven by strong store-level productivity and accelerated inventory turnover, the brand’s revenue increased by 44 per cent to Rs 1,724 crore. High consumer demand for functional daily wear - such as Heattech and Airism ranges - helped the brand outperform legacy fast-fashion competitors amidst tighter retail spending across urban centers.

Capital spending shift to local supply chains

Uniqlo’s margin expansion reflects a broader structural operational model centered on local sourcing efficiency. The brand manufactures over 30 per cent of its inventory locally through partnerships with more than 20 Indian textile mills and garment facilities. This local supply chain strategy mitigates import duty volatility while supporting modern spinning, weaving, and finishing standards required for high-volume apparel manufacturing. India remains a central anchor for our Asia-Pacific footprint, combining robust consumer demand with increasingly efficient local manufacturing capabilities, states a senior Fast Retailing executive.

Strategic store rollouts and market footprint

To capture momentum in non-metro hubs, Uniqlo is ramping up retail real estate investments across Tier-I &II locations. The company plans to scale its physical footprint toward its long-term revenue target of Rs 3,000 crore. Facing rising commercial real estate rental costs and competitive pressure from international fast-fashion rivals, Uniqlo is leveraging automated omnichannel fulfillment to protect retail operating margins while deepening market penetration.

Owned by Fast Retailing Co, Uniqlo India provides functional, high-quality LifeWear apparel. Operating major retail outlets and e-commerce across metro and Tier-1 Indian cities, it focuses on core categories like functional innerwear, outerwear, and everyday basics. The company aims to achieve Rs 3,000 crore in annual sales by opening strategic new stores, expanding local manufacturing sourcing, and maintaining double-digit annual profit growth built on its seven-year market presence.

Uniqlo India strengthens market position as FY26 net profit rises to Rs 253 crore

Ed-a-Mamma marks six-year milestone with aggressive omni-channel retail expansion

As conscious consumerism reshapes the domestic retail ecosystem, Alia Bhatt’s lifestyle label Ed-a-Mamma marks its sixth anniversary this October, transitioning from a digital-first kidswear venture into a robust multi-category apparel powerhouse. The brand has capitalized on rising demand for sustainable children’s fashion, scaling its exclusive brick-and-mortar storefronts across Tier-I and Tier-II Indian cities while reinforcing its digital footprint. Industry analysts note, the label's steady valuation growth mirrors a broader market preference for homegrown, eco-friendly textile alternatives.

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Strategic diversification and global aspirations

Building upon its core children’s wear and recently introduced infant care lines, leadership is setting its sights on broader demographic segments, including maternity wear and lifestyle accessories. We are thrilled by the community response over the past six years as we deepen our market penetration, shared a senior retail strategist at the company. To sustain momentum, the enterprise is evaluating strategic entry into international territories, with the Gulf Cooperation Council (GCC) region slated as a primary target for upcoming fiscal expansion, backed by robust supply chain optimizations and localized marketing campaigns.

Refer

Specializing in conscious children’s clothing

Founded by prominent actor and entrepreneur Alia Bhatt, Ed-a-Mamma is a purpose-driven sustainable lifestyle and apparel brand specializing in conscious children’s clothing, infant care, and mother-centric products. Operating primarily across India through major e-commerce portals and expanding exclusive brick-and-mortar retail outlets, the company targets urban families seeking eco-friendly, ethically produced garments. Backed by strong financial performance and strategic retail partnerships, the brand focuses on scaling its domestic footprint, expanding into international markets like the GCC, and broadening its sustainable product portfolio.

Easitex-Textiles Sustainability

Ed-a-Mamma marks six-year milestone with aggressive omni-channel retail expansion

Advertising rush drives digital shift as Myntra re-aligns monetization

Myntra Designs is undergoing a structural shift toward high-margin digital services, even as top-line figures reflect operational adjustments. The Flipkart-owned fashion e-commerce major recorded a 13.5 per cent decline in consolidated operational revenue to Rs 5,242.5 crore in FY26, down from Rs 6,063.8 crore in FY25. The contraction stems primarily from a planned drop in logistics and shipping service revenues - which fell to Rs 1,119.2 crore from Rs 2,390.5 crore. Conversely, core marketplace operations expanded 12 per cent to Rs 4,123.3 crore, lifted by strong demand for brand visibility solutions.

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Ad income expansion cushions higher promotional outlays

Advertising revenue increased by 35.2 per cent Y-o-Y to reach Rs 1,236.4 crore, proving that apparel brands are allocating larger promotional budgets to secure digital storefront placement. Total expenses rose marginally by 0.6 per cent to Rs 5,757.7 crore, driven by a 12.8 per cent jump in marketing and business promotion spending to Rs 3,059.8 crore, while direct logistics expenditures declined by 14 per cent to Rs 1,841 crore. The platform swung to a net loss of Rs 579 crore, reversing the deferred-tax-led Rs 548 crore profit of FY25. Leadership under newly appointed head Sharon Pais is now positioning the company to hit 100 million monthly active users in FY27.

SUSTAINABILITY

E-commerce monetization evolution

Fashion e-commerce platforms are re-allocating capital toward retail media networks, monetising high consumer intent to protect underlying margins, notes a Bengaluru-based Digital Retail Strategist.

EASITEX

Myntra retail ecosystem

Myntra operates an e-commerce platform specializing in apparel, footwear, and beauty products across major Indian cities. Established in 2007, the Flipkart subsidiary is expanding quick-commerce fashion deliveries and high-margin ad solutions, targeting 100 million active users in FY27 following Rs 5,242.5 crore FY26 revenues.

Easitex-Textiles Sustainability

Advertising rush drives digital shift as Myntra re-aligns monetization

OVS to accelerate India expansion with seven new store openings by 2027-end

Italian apparel major OVS SpA plans to accelerate its India expansion by opening seven new stores by 2027-end. The company recently launched a 12,400-sq-ft flagship store at the R City Mall in Ghatkopar, Mumbai. This location marks the brand’s largest physical store in India and anchors a broader strategy to establish new retail points across key metropolitan and high-growth urban hubs.

Capitalizing on demand for inclusive value-fashion

The flagship rollout reflects a wider trend of international fashion conglomerates expanding large-format brick-and-mortar stores to capture growing middle-class spending. To differentiate its offering, OVS introduced its size-inclusive curve label, MYA, alongside proprietary fashion lines such as Piombo, Les Copains, B.Angel, and OVS Kids. Industry analysts note, demand for value-segment apparel in India is expanding beyond core metropolitan centers, prompting global retailers to combine flagship urban locations with targeted expansions into Tier-I and Tier-II markets like Pune, Surat, and Chandigarh.

India's organized retail landscape presents an unmatched growth corridor for European multi-brand concepts. Bringing specialized lines like MYA demonstrates the brand’s commitment to tailored merchandise mixes that directly align with evolving regional consumer preferences, says Stefano Beraldo, CEO, OVS SpA.

Overcoming leasing bottlenecks

Despite strong consumer demand, international retail chains face significant headwinds from tight supply in premium shopping center space. Total retail space leasing across top Indian metropolitan areas increased by 10.5 per cent Y-o-Y in early 2026, creating aggressive competition for primary ground-floor real estate. To mitigate inventory costs and operational friction, OVS relies on its global parent group’s fiscal scale - backed by €1.746 billion in global revenue and over €218 million in EBITDA - allowing the brand to absorb premium real estate costs and leverage centralized supply chains.

Targeting mid-to-long-term growth

OVS SpA is a publicly traded Italian apparel retailer operating over 2,600 stores globally. Listed on Euronext Milan, the group specializes in accessible men's, women's, and children's fashion, backed by brands including Upim and PIOMBO. The group targets mid-to-long-term growth through aggressive international retail expansion and eco-efficient sourcing.

 

OVS to accelerate India expansion with seven new store openings by 2027-end

Festive fashion demand rises across non-metro digital retail

India's festive retail season opened with a sharp rise in digital consumer traffic, driven primarily by apparel and beauty adoption across Tier-II & III cities.A fresh report from Bank of America Global Research highlights, Flipkart achieved record daily active users during the initial leg of its flagship Big Billion Days campaign.Non-metro markets generated approximately 60 per cent of total consumer demand, while new customer onboarding expanded by 34 per cent.

Specialized fashion vertical Myntra registered a 40 per cent jump in daily active users relative to September averages, reaching 93 million monthly active users, whereas Nykaa Fashion recorded a 24 per cent Y-o-Y growth to 17 million active users. Tier-II & III consumer markets are transforming from secondary growth drivers into primary demand anchors for festive fashion, observes Sachin Saluja, Senior E-Commerce Analyst, BofA Research.

MUCH MORE

Credit integration unlocks high-value basket spending

To capture growing fashion appetite amid shifting macroeconomic pressures, major platforms are leveraging retail financing tools, including zero-cost flexible payment plans and co-branded credit instruments. Early data shows customer conversion across premium apparel and lifestyle segments rose significantly as buyers utilized structured installment plans to manage larger ticket sizes. Consequently, traditional e-commerce marketplaces outperformed instant delivery channels in lifestyle categories, as consumers prioritized merchandise range, promotional discounting, and structured financing over quick-commerce speed during seasonal wardrobe upgrades.

Refer

Festival retail focus: Flipkart commerce operations

Founded in 2007, Flipkart is a leading Indian e-commerce marketplace spanning fashion, electronics, and general merchandise. Focusing primarily on domestic retail, it targets rapid volume growth in non-metro regions via its platform and Shopsy vertical. Supported by parent Walmart, Flipkart continues scaling operations while narrowing marketplace losses through operational efficiency.

Easitex-Textiles Sustainability

Festive fashion demand rises across non-metro digital retail

Retail giants scale localization strategies

Global intimate apparel brands are increasingly shifting toward hyper-localized promotional strategies to secure market share in high-growth emerging economies. Victoria's Secret accelerated this transition by deploying Bollywood celebrity Triptii Dimri as its maiden Indian ambassador, matching international luxury merchandising with regional star power. Industry analysts note that leveraging domestic icons significantly enhances consumer resonance within the subcontinent’s expanding discretionary retail sector.

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Global footprint expansion

The strategic alignment mirrors broader commercial efforts by multinational conglomerates to capture rising middle-class consumer spending across South Asia. According to recent retail data, premium intimate wear sales in urban clusters have surged by over fifteen percent year-on-year, driven by wider accessibility and localized digital marketing. "Aligning with influential regional figures allows international labels to translate global brand equity into domestic retail relevance," stated retail strategist Alok Sharma.

EASITEX

Scaling digital-first retail networks 

Victoria’s Secret operates as a premier global specialty retailer offering modern lingerie, sleepwear, and beauty products. Targeting urban consumers across North America, Europe, and Asia, the brand focuses on scaling digital-first retail networks and localized celebrity partnerships. Experiencing renewed financial recovery through targeted merchandising transformations, the company traces its historical roots to its founding in San Francisco in 1977.

Easitex-Textiles Sustainability

Retail giants scale localization strategies

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