ZOZO, Inc. (3092) Results Comment: In line-Structural margin improvement from logistics efficiency

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ZOZO, Inc. (3092)

Results Comment: In line-Structural margin

improvement from logistics efficiency

Reiterate Rating: BUY | PO: 1,550 JPY | Price: 1,143 JPY

Investment view: Reiterate Buy with PO of ¥1,550

31 July 2026

1Q results were broadly in line with our expectations. We make no changes to our

earnings forecasts or PO. Our PO of ¥1,550 is based on a DCF valuation (WACC of 5.8%

and terminal growth rate of 0%). Underlying GMV growth remained solid in 1Q, while

adjusted EBITA reached a record high for a first quarter. We expect ROE to exceed 50%

in FY3/27 following share buybacks and share cancellations. We reiterate our Buy rating,

reflecting both stronger shareholder returns and earnings growth. A key near-term

catalyst is an acceleration in GMV growth as previously deferred promotions are

deployed in 2H.

Equity

1Q results (Apr-Jun 2026): Strong results driven by GMV

growth and cost discipline

1Q OP rose 5.7% YoY to ¥17.9bn, broadly in line with our forecast of ¥17.8bn and

consensus of ¥18.1bn. ZOZOTOWN GMV increased 3.6% YoY to ¥147.4bn (vs. our

forecast of +4.4%), while company-wide GMV excluding other businesses rose 5.1% YoY

to ¥156.6bn. Improved delivery efficiency and warehouse productivity reduced shipping

and logistics-related labor costs, driving a 0.6ppt YoY improvement in the SG&A ratio.

Maintain forecasts, focus shifts to 2H GMV growth

We make no changes to our FY3/27 forecasts, as 1Q results were broadly in line with our

expectations. Key areas to watch are (1) GMV acceleration from 2Q onward as deferred

promotional spending is deployed, (2) further margin improvement from better delivery

outsourcing terms, and (3) interim-term synergies from newer businesses and

investments, including niaulab, High Link, and LYST. The impact from the

discontinuation of ZOZO Options should largely be absorbed in 1H, and we expect

company-wide GMV to return to growth in 2H. We therefore see 2H topline growth as

the key area of focus.

Estimates (¥)

EPS

EPS Change (YoY)

Consensus EPS (Visible Alpha)

Dividend / Share

BPS

Valuation

P/E

Dividend Yield*

P/B

EV/ EBITDA*

Free Cash Flow Yield*

3/25A

3/26A

3/27E

3/28E

3/29E

Other GAAP

50.90

3.0%

53.73

…