The luxury e-commerce retailer reported a £5.9 million ($7.9 million) loss for the fiscal year ending 31 January 2020, just weeks before the pandemic radically shifted the retail landscape.

The company pointed to investments in operations, technology and infrastructure to explain the loss, but revenue growth also continued to slow. Sales hit £430.5 million in 2019, a 16 percent year-on-year increase compared to 27 percent in 2018 and 44 percent in 2017.

The results reflect a key challenge facing luxury e-commerce businesses: finding scale while maintaining profitability in an increasingly competitive landscape. Matchesfashion’s bigger rivals Net-a-Porter and Farfetch face similar dilemmas.

Matchesfashion’s struggles led to the departure of former CEO Ulric Jerome in August 2019. (Jerome’s successor Ajay Kavan, a former Amazon executive, joined the company last March, just as the pandemic hit Europe).

The luxury retailer provided little information about how it has performed over the course of the last 12 months. It noted that demand “was significantly down” early on in the crisis, but subsequently recovered.

Yet its physical operations suffered substantially. It was forced to cancel events, close its physical locations in London during lockdowns and press pause on plans to open a physical presence in New York, resulting in the furlough of 29 percent of employees.

On the other hand, Matchesfashion secured an additional £35 million in funding from investor Apax Partners in April 2020 to help deal with the impact of the pandemic. And over the course of the last 12 months, online sales of luxury goods have skyrocketed as pandemic jitters and lockdowns shifted consumer behaviour, accelerating market growth by about five years, according to Bain & Co. At this point it’s unclear exactly how much Matchesfashion was able to benefit.