Farfetch Shuts Down Online Beauty Shop

Luxury fashion company Farfetch is exiting the beauty business and will stop selling beauty products on August 31, reports Vogue Business.
This news comes just over a year after Farfetch launched its beauty business when it acquired high-end beauty retailer Violet Grey in January 2022. In April 2022, Farfetch launched its online beauty shop with a selection of prestige brands, including Augistinus Bader, Dr. Barbara Sturm and Charlotte Tilbury Beauty.

Lower-Than-Expected Sales

According to Market Watch, shares of Farfetch Ltd. dropped more than 30% in the extended session Thursday after the company reported lower-than-expected sales for its second quarter. Farfetch posted a loss of $281 million, or 68 cents a share, in the quarter, compared with a loss of $68 million, or 50 cents a share, in the year-ago period. Meanwhile, revenue fell to $572 million, from $579 million a year ago.
The decline of Farfetch highlights how challenging it can be to navigate the beauty market—even for established fashion players. U.S. prestige beauty industry sales revenue grew 15% year over year in 2022, reaching $27.1 billion, according to The NPD Group (now Circana). In fact, prestige beauty was the fastest-growing industry segment, across more than $4 trillion in U.S. general merchandise consumer spending tracked by NPD and IRI. But tapping into that market is easier said than done.
Farfetch has yet to turn a profit in its history as a publicly-traded company.

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