By Andrea Figueras

Shares in ASOS soared after the online fashion retailer started to show green shoots from its turnaround strategy.

For the six months through March 1, the company posted an on-year increase of around 50% in adjusted earnings before interest, taxes, depreciation and amortization.

The stock was up 14.5% at 243 pence in European morning trading.

The group is pushing ahead with a business reset, which started after Chief Executive Officer Jose Antonio Ramos Calamonte took the reins in 2022, while it tries to fend off rising competition in the fashion space.

"ASOS is making good progress on its strategy to improve the underlying profitability of the business," analysts at RBC Capital Markets wrote in a note to clients. However, the company operates in a highly competitive environment and more investments may be required to drive revenue, they added.

Meanwhile, the group said Wednesday that for its fiscal first half, gross merchandise volume--a key top-line indicator--dropped 9% compared with the same period a year prior, according to a pre-close trading update.

This was below estimates and reflects ASOS's limited participation in a highly promotional apparel market, Berenberg analysts said in a note. Despite the drop, the group pointed to a sequential improvement over the first and second quarters.

"We are constructive on ASOS's ongoing recovery potential," Berenberg said.

Green shoots should start to translate into better results in gross merchandise value over the group's fiscal second half, Peel Hunt analysts said in a research note.

"A return to revenue growth is the next milestone," they said.

Meanwhile, analysts at Panmure Liberum said that ASOS needs a return to sales growth to prove that the significant changes made to the operating model are resonating enough.

The company maintained its targets for fiscal 2026 as a whole and pointed to an improvement in new customer growth.

Write to Andrea Figueras at andrea.figueras@wsj.com

(END) Dow Jones Newswires

March 25, 2026 06:47 ET (10:47 GMT)

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