The insight: Weak consumer sentiment in Europe is hurting fast fashion sales.

• Primark parent Associated British Foods expects the brand’s like-for-like sales to fall 2% YoY in the second half, mainly due to weakness in Northern Europe, France, Italy, and the UK.
• Zara owner Inditex reported fairly anemic growth of just 1.6% YoY in H1 2025, short of expectations, due to a “complex” operating environment.

Additional headwinds: Primark and competitors are also grappling with an all-out push from Shein and Temu to bolster European sales as trade tensions derail their US ambitions.

• While Primark is confident about its ability to stay competitive on price, its reliance on physical stores puts it at a considerable disadvantage to its Chinese ecommerce rivals.
• Inditex, meanwhile, has the advantage. Zara’s more expensive, higher-quality, and trend-forward wares allow the chain to bring in more affluent shoppers. At the same time, it is able to capture more price-sensitive shoppers with its low-cost Lefties brand, which is expanding throughout Europe.

However, competitive pressure from Shein and Temu could abate once the EU begins to implement fees on de minimis imports.

Our take: The challenging environment in Europe increasingly favors Shein and Temu, whose ability to undercut competitors on price and deliver a steady stream of trendy products positions them to take more fast fashion share. But as in the US, both companies could fall afoul of geopolitical tensions as European governments raise concerns about Chinese overcapacity—and President Trump pushes the EU to implement 100% tariffs on China imports.

Go further: Read our report on The State of French Fashion Ecommerce 2025.