Fast Fashion H&M Is Now Facing Serious Challenges.

The picture shows H&M's store.

In view of competitors

The strong pressure of parent company Inditex group (IDEXY), Sweden

Group (HNNMY) said it would follow the market trend to further price adjustment.

The Wall Street journal pointed out that investors may need to make preparations for H&M group's share price to continue to fall, and its stock has so far fallen by 26%.

Bernstein analyst Jamie Merriman and Jennifer Wong pointed out in a research report: "when most fashion retailers complain about the negative effects of weather on the sales environment, the performance of ZARA parent group Inditex proves the strong power of the business model and its ability to create outstanding performance."

Inditex group's first quarter turnover amounted to 4 billion 880 million euros, up 12% over the same period last year, which exceeded FactSet analysts' earlier estimate of 4 billion 840 million euros.

During the period from February 1st to April 30th, revenue rose 17% and net profit increased by 6% to 554 million euros.

Investors worried about H&M's first half of last year's earnings and profit margins and its poor store performance on Wednesday.

Despite the decline in sales profit margins and uncertainty in the future of same store performance, H&M group has consistently maintained an annual expansion of 10% of its stores.

H&M started its annual report in 2014 to stop disclosing its same store performance to investors, instead of focusing on brand expansion and trying to establish online channels. But according to analysts at Credit Suisse, H&M's same store performance fell 5.3% in the second quarter of this year.

Jyrki Tervonen, group chief financial officer, said that in order to make H&M still competitive in the future market, we will adjust the price of H&M products and try our best to provide consumers with the most valuable products.

However, he did not disclose the specific price adjustment and implementation time.

Fast fashion, which relies on poor quality and cheap development in recent years, is now facing serious challenges. In the first half of the year, H&M's profits plunged 21.5% to 7 billion 900 million Swedish kronor (about 945 million 500 thousand US dollars), and pre tax profits plunged 22% to 10 billion 330 million Swedish kronor (about 1 billion 240 million US dollars). During this period, tax turnover increased 5% to 104 billion 970 million Swedish kronor (about 12 billion 560 million U.S. dollars), which was close to double-digit growth compared with the same quarter last year. Obviously, H&M has entered a channel of performance slowdown.