AO World PLC (LON:AO.) said it experienced its strongest ever peak trading period between Black Friday period and Christmas.
In the three months to December 31, revenue in the UK soared 67% to £457mln while in Germany it was up 77% to €73mln (£65mln).
The FTSE 250 firm incurred significantly higher costs as it negotiates some of the operational challenges of working in a covid-compliant environment, particularly in the reverse supply chain, while there has also been an increased rate of cancellation of individual consumers’ long-term contracts in mobile and warranties, driven by the economic crisis.
However, working from home and associated usage and appreciation of electrical products are expected to continue drive up sales.
The online retailer said it continues to invest in its infrastructure to meet demand including additional staff in warehouses, vehicles and drivers, after hiring 1,500 people in 2020.
“This is an upbeat trading update, which shows the continued momentum given both the structural shift online and the benefit as other brands physical electrical stores remain closed, as they are not deemed essential retailers during lockdown 2.0 and now lockdown 3.0,” analysts at Shore Capital noted.
“This is AO World’s moment to shine given that the online market has seen a structural shift that could be permanent by consumers… The big challenge will be whether the revenue momentum can continue during the first quarter in financial year 2022 given the tough comparatives that the business will start cycling.”
Shares dropped 7% to 351.5p on Tuesday morning.