H&M’s earnings took a hit due to one-time costs from its cost-cutting plan. Sales fell short because shoppers in Europe bought less than expected. The company did manage to raise its gross margins, but profits suffered as a result.
Analysts warned the stock might not recover unless sales start to climb. They also highlighted that reducing inventory caused shortages on shelves, which damaged sales further. One firm held its buy rating but stated growth is the main key issue.