Asos shares surge 9% as H1 margin recovery signals turnaround

ASOS PLC shares surged over 9% after the online retailer reported a significant improvement in first-half profitability, with gross margins expanding to 48.5 percent.

"The results show progress on our turnaround plan, focusing on a more profitable and cash-generative business," a company spokesperson said in a statement.

For the first half of 2026, ASOS reported adjusted EBITDA of £64 million, a 51% increase from the prior year. The company's gross margin improvement of more than 300 basis points was a key driver of the enhanced profitability, though the company did not disclose revenue or earnings-per-share figures for the period.

Metric	Actual	Consensus	Beat/Miss
Revenue	Not Disclosed	N/A	N/A
EPS	Not Disclosed	N/A	N/A
Gross Margin	48.5%	N/A	N/A
Adjusted EBITDA	£64M	N/A	N/A

The stock jumped to 245.88p, its highest in six weeks, as the margin recovery provided the first tangible sign that CEO José Antonio Ramos Calamonte's turnaround strategy is taking hold. The positive reception suggests investors are willing to look past the lack of top-line growth figures for now, focusing instead on the path to sustainable profit in the competitive fast-fashion market.

The report comes amid a challenging environment for online apparel retailers, with competitors like Boohoo Group PLC also grappling with high inventory levels and intense promotional activity. ASOS has been actively working to reduce its stock levels and wean itself off the deep discounting that has eroded profitability across the sector.

The strong margin performance indicates ASOS's focus on inventory management and reduced promotions is yielding results. Investors will now look for the company to translate this profitability into top-line growth in the second half of the year.

This article is for informational purposes only and does not constitute investment advice.