Asos shares surge by more than 20 per cent after positive trading update

Asos shares experienced a surge of over 20% this morning, following the release of an encouraging market update that exceeded expectations.

The online retail giant informed investors of its anticipation for a "significant improvement in profitability" within the year, also noting a resurgence in full-price sales of its own brand, as reported by City AM.

The announcement was met with a warm reception from investors, as evidenced by a more than 20% increase in Asos' share price within the first half-hour of trading.

Russ Mould, Investment Director at AJ Bell, commented on the positive shift: "After a dreadful start to 2025 for the share price, Asos was primed for a relief rally if it could offer any sort of positive news."

Mould further added, "Today's numbers represent an important first step on a long road to recovery, but the market will want to see some evidence eventually that metrics like active customers and orders are picking up when the company reports its first-half numbers in April to have real confidence in an Asos turnaround."

Since the onset of the pandemic, Asos' share price has been on a consistent decline, shedding a staggering 94% of its value between July 2021 and March 2025.

The company has grappled with a general downturn in e-commerce post-pandemic, a trend that has similarly impacted competitors such as boohoo and Pretty Little Thing.

In the previous year, Asos reported a 16% drop in active customers, accompanied by a 4% decrease in purchase frequency and a 20% reduction in orders.

"Improving profitability has been a key focus for the group, with successful efforts made to reduce inventory levels and allow Asos to operate from a more agile business model," stated Katie Cousins, an analyst at Shore Capital.

Analysts at Peel Hunt commented that Asos appears to be "on track."

"Nonetheless, with the shares down 30 per cent in the last month, there's some catching up to do this morning."