Zalando Feels Growth Pains as Margins Miss Estimates
- Cost of boosting sales weighing on online retailer's margins
- Company `willing to trade in some profitability' for growth
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Zalando SE cut its profitability forecast as the online fashion retailer hires more workers and pumps money into marketing, highlighting the growing pains it’s weathering in its second year as a public company.
Sales for 2015 will be higher than originally forecast, though the cost of achieving that will crimp profit margins, the company said. The shares fell as much as 13 percent, their biggest intraday drop in more than a year.