Sales fell 4 percent in the three months through November at constant currencies, the company said Friday, in line with analysts’ expectations.

The company has lost the sales growth momentum it last demonstrated in the first half of last year. The slowdown increases pressure on H&M to increase discounts to clear inventory, a problem the company has struggled with for more than seven years. H&M warned in September that revenue was dropping that month due to an abnormally warm start to autumn in Europe.

H&M shares were little changed in Stockholm.

Last year, sales were boosted by a temporary reopening in Russia before the retailer permanently discontinued operations in the country. H&M gradually started reopening in Ukraine in November after having closed operations in February 2022 due to the war.

Excluding Russia and Belarus, the sales decline was 1 percent.

On Wednesday, Zara owner Inditex SA reported 7 percent quarterly revenue growth, the slowest rate in almost three years.

H&M has been vulnerable to competition from the likes of Inditex and upstart Shein, which has been grabbing market share with cut-price offerings. Still, H&M’s stock has climbed 57 percent this year as the company tries to improve profitability and reduce the inventory backlog.

By Rafaela Lindeberg

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