PARIS — Inditex can “spin on a dime” — and its supply-chain flexibility is insulating the company from the current Middle East war shocks, said chief executive officer Óscar García Maceiras.
Maceiras made the comments following the release of fiscal year 2025 results Wednesday morning, speaking on a conference call with analysts, followed by a press conference.
“We have our franchisee network in the region, and in the last week, some of our stores in a number of markets have been temporarily impacted,” he said. “This has had a slight impact on the trading update we have provided today.”
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The Spanish fast-fashion giant, parent of Zara, said that sales at the start of the first quarter, from Feb. 1 to March 8, were up 9 percent year-over-year in constant currency, with the spring collections performing well.
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“Most of our stores are open in the region,” he said of the Middle East, sidestepping questions about precise numbers and countries, though he conceded that some stores in Israel remain closed. “The impact on sales so far has been limited.”
Maceiras added that he does not believe the war will affect consumer prices.
“We are also following developments in the market, and our sourcing and logistics model is diversified across regions and transport modes, providing flexibility and resilience should conditions change,” Maceiras said. Inditex’s strategy of prioritizing proximity sourcing and short lead times has contributed to stability “despite significant impacts in our supply chains and currency markets,” he added.
“We have confidence for the year ahead, and we’re not seeing anything significant in terms of disruptions at this stage,” added Gorka García-Tapia, director of investor relations. Air and sea freight costs are being monitored, but the business model “provides flexibility,” he added.
The 2 percent year-over-year reduction in inventory for fiscal 2025 was “strategic,” Garcia-Tapia said, rather than a result of supply-chain issues, reflecting the company’s focus on maximizing full-price sales.
Fourth-quarter sales were affected by currency headwinds, with reported sales up 3.9 percent year-over-year to 11.66 billion euros, as a stronger euro weighed on U.S. dollar results. That was at the lower end of analyst expectations, which had projected sales growth of 9 to 10.5 percent at constant currency.
“Some geographical areas have been harder hit,” Maceiras said, explaining the gap between reported sales growth and growth at constant currency.
The company expects the currency effect to continue.
“Looking at the year ahead, at current exchange rates, we expect a minus 1 percent top-line foreign exchange impact in 2026 — albeit with a notable first-half weighting. As already mentioned, sales were positive in all concepts,” said chief financial officer Andrés Sánchez.
In the U.S., the company has adapted to tariff impacts following the pandemic and Suez Canal shocks over the past five years, Maceiras said, and will continue to invest in the region.
“2026 is going to be a year where we’re directing a significant part of our investment to the U.S. market,” he said. “We will keep developing projects in the area and improving our presence.” That will come through store expansions and new brand openings.
Inditex also owns the younger-skewing and lower-cost Bershka, Pull & Bear and Stradivarius, as well as Massimo Dutti, which has premium positioning, and the activewear-oriented Oysho. Its Lefties concept, which began as a channel for unsold Zara items in Portugal and Spain, has grown to develop its own line of lower-priced products.
Maceiras attributed fourth-quarter performance to strong results from Bershka and Stradivarius, due to both their price points and their ability to bring trendy items to market quickly.
Inditex is betting on Bershka for further growth, particularly in the Americas. The youth-skewing brand will open its first physical stores in the U.S. in 2026, following a “very successful” online launch, and will also open stores in Brazil, though the company did not provide details on specific locations.
Massimo Dutti will continue its global expansion with additional stores in Miami and New York City, as well as its first entries into Denmark and Norway. Pull & Bear will expand into Denmark, while Zara Home will open its first stores in Ireland and Norway. Lefties will open its first physical stores in France and the U.K. as well as launch homewares, while flagship brand Zara will open its first store on the Dutch Caribbean island of Curaçao.
Zara will refurbish its Fifth Avenue and 34th Street stores in New York City in the coming year. Combined with other store expansions and upgrades, Inditex’s total retail floor space is expected to grow 5 percent in 2026.
Though Zara grew at a slower pace than in previous years, Maceiras declined to attribute this to the brand’s upscaling or price increases, instead emphasizing its continued cultural and fashion influence.
“The relevance that Zara continues to accrue extends beyond the limits of fashion. Over the past four years, sales have grown by more than 8 billion euros, which is over 44 percent growth. Zara is the sales engine for the group, the engine for profits, and a source of inspiration since the beginning of the company’s activities nearly half a century ago,” he said.
“Inditex has been elevating the perception of its Zara brand, helping it differentiate from ultra low-cost rivals like Shein,” said Third Bridge senior analyst Yanmei Tang.
“The company is moving away from competing solely on price and is instead focusing on fashion credibility, brand storytelling and the in-store experience. This strategy seems to be paying off as traditional luxury brands face pressure from rising prices. By offering better design and quality at a lower price than luxury labels, Zara is attracting some shoppers who previously bought high-end fashion,” Tang added.
Maceiras also highlighted growth at the lounge and activewear label Oysho, which rose 16 percent in 2025, expanding in Germany, the Netherlands and the U.K., and positioning itself with sporty experiences, including the launch of running clubs.
After two years of heavy logistics investment, Inditex said capital expenditures are returning to stable levels and are largely geared toward technology, including AI. The company has rolled out AI-assisted try-on, enabling customers to create avatars and virtually try on clothing. This technology is now available in 43 markets, with more than 7 million users and will continue to expand as it is easily “scalable,” Maceiras said.
Looking at the full year, sales were up 3.2 percent year-over-year to 39.9 billion euros on a reported basis, in line with analyst expectations, while net income rose 6 percent to 6.2 billion euros. Growth was driven by strong gross margins and a focus on full-price sales, as Inditex continues to push its fashion positioning.
Inditex maintained tight control over operating expenses, contributing to a 5 percent increase in EBITDA to 11.3 billion euros. The retailer emphasized ongoing investment in store optimization, online platforms and sustainability initiatives as it continues to expand globally.
Share prices zoomed up 4 percent at the opening bell, and eased to a 2.5 percent gain by midday.
“Inditex has executed well in recent years, benefiting from its strong design and buying setup and quick-response business model. It has become more integrated between stores and online and has leveraged RFID technology to maximize full-price sales through efficient inventory management and more frictionless checkout,” said RBC analyst Richard Chamberlain.
The company said its winter collections were well received across all regions, with especially strong performance in its largest European markets, where currency stability helped. Its home country of Spain in particular drove growth, with sales up 9 percent there.