Stability in challenging times: Otto Group maintains high revenue level

Despite significant macroeconomic challenges, the Otto Group was able to maintain the high revenue level of the very successful previous 2021/22 year in the 2022/23 financial year (28 February 2023). The reported revenue of the Hamburg-based retail and services Group for the past financial year amounted to EUR 16.2 billion. On a comparable basis*, revenues were 2 percent lower than in 2021/22. Despite very adverse circumstances, the Otto Group is demonstrating its stability and will continue to invest a triple-digit million amount in projects of high strategic relevance in the current 2023/24 financial year.

Once again, the Otto Group’s diversification in different sales and procurement markets as well as business models had a very positive effect – a major strength of the Group. While revenue in Germany fell by 9.2 percent to around EUR 9.0 billion on a comparable basis in the 2022/23 financial year due to the enormous reluctance to purchase, revenue in foreign markets grew by a comparable figure from almost EUR 6.3 billion to just under EUR 7.2 billion (+9.6 percent). Global e-commerce revenues were EUR 12.0 billion, almost at the previous year’s level.

Alexander Birken, Chairman of the Executive Board and CEO of the Otto Group: “The figures show that we could not escape the market trend. The tumultuous and turbulent times amidst the terrible war in Ukraine, the energy crisis, inflation, and the resulting consumer slump have also affected our business. Although we were able to slightly increase the number of active customers and more or less maintain our market share, we cannot be satisfied with the financial year. Nevertheless, we are operating on a very solid base, in part due to the highly successful 2020/21 and 2021/22 financial years.”

This is also supported by the high attractiveness of the trading concepts and platforms. The number of active customers in the multi-channel distance selling concepts has increased again and now stands at around 54 million.

Operating results break even

High factor costs, inflation, and the resulting negative consumer sentiment combined with smaller basket sizes had a negative impact on all result levels. The high volume of pre-orders made on the basis of completely different economic forecasts for 2022/23, and the resulting need for discounts to sell them down, also had a negative impact. In addition, there were temporary charges from strategic investments in platform transformation at OTTO and logistics expansion. Nevertheless, the Otto Group was able to achieve a basically break-even operating result through strict cost discipline.

Earnings before interest, taxes, depreciation, and amortization (EBITDA) were EUR 589 million, and earnings before interest and taxes (EBIT) were EUR 22 million. Earnings before taxes (EBT) amounted to EUR -224 million. It should be noted that the very positive earnings effects at the EBT level in the previous 2021/22 financial year were mainly due to the full consolidation of About You and the sale of Mondial Relay in France, which represented special one-time effects.

Although the equity of the Otto Group decreased in the 2022/23 financial year, it remains at a very solid level with an equity ratio of around 37 percent.

Varying revenue growth in the segments

The foundation for the solid structure of the Otto Group was laid by the focused growth strategy adopted six years ago. It is used to manage the Platforms, Brand Concepts, Retailers, Services, and Financial Services segments. In each segment, different developments can be observed.

The entire retail sector in 2022 was initially influenced by the recovery process after the pandemic. However, this progress was hampered by crisis- and war-related special effects that weighed on the macroeconomic circumstances. The online retail sector in Germany was particularly affected. This development is especially evident in the Platforms and Retailers segments.

The Platforms segment, which includes OTTO and About You, reported revenues of around EUR 6.5 billion, as in the previous 2021/22 financial year. However, on a comparable basis, revenues decreased by 6.2 percent.

The Retailers segment, which includes in particular Baur (Retail) as well as Unito, Limango, Freemans Grattan, Frankonia, Manufactum, and Mytoys, generated revenues of just under EUR 2.3 billion, compared to around EUR 2.5 billion in the previous year. This represents a decline of 7.2% on a comparable basis.

The Brand Concepts segment benefited mainly from the strong performance of Crate and Barrel and increased its sales from EUR 5.5 billion to around EUR 5.9 billion (on a comparable basis: +2.3 percent). This segment also includes Bonprix, incl. Venus, the Witt Group with Heine, and Sheego.

The transport and logistics industry was also influenced by the volatile macroeconomic trend in 2022 and, in particular, the associated slowdown in online and mail-order sales in Germany. The Services segment, which includes Baur Logistics, Girard Agediss, Hermes Einrichtungsservice, Hermes Fulfilment, Otto International, Evri, and Hermes Germany, reported a decline of 2.9 percent on a comparable basis and generated revenue of EUR 390 million. Revenue from the parcel distribution activities of Hermes Germany in Germany and Evri in the United Kingdom has not been included in the Otto Group’s consolidated financial statements since the 2020/21 financial year.

By contrast, the development of the Financial Services segment, which mainly comprises the EOS Group, was very positive. Revenues in this segment amounted to EUR 983 million, compared to EUR 813 million in the 2021/22 financial year, an increase of more than 24 percent on a comparable basis.

Strategic investments and innovations for customers

As in previous financial years, the Otto Group continues to prioritize investments and innovations of high strategic relevance in the current financial year. The Group will again allocate a three-digit million amount for this purpose. The goal is to actively seize market opportunities, better meet the needs of existing customers, and attract new customers.

To this end, the Otto Group continues to invest in superior delivery service and the overall optimization of delivery and service quality. The new state-of-the-art logistics center currently under construction in Ilowa, Western Poland, is expected to be operational in the spring of 2024, as previously announced. This will make it possible to process goods even faster and more efficiently, and significantly advance next-day delivery. In addition, the expansion and modernization of the Altenkunstadt location is scheduled for completion in spring 2024. This will create one of the largest and most advanced fulfillment centers in Europe.

Investments of high strategic relevance also include funds for continuing to turn the Group company OTTO into an e-commerce platform. Revenues are now being generated in three business areas: in retail and as a marketplace and service provider. The number of cooperations and partners on otto.de is still growing strongly thanks to an automated registration procedure. Together with now over 5,000 partners, Otto offers around 14.5 million products on the platform. In addition to the successful development of Retail Media, the Otto Group reached a milestone in its transformation, particularly in the area of payments, with the receipt of the BaFin license and the subsequent launch of OTTO Payments GmbH, which significantly improved the customer experience for both end customers and marketplace partners.

In a visionary move to further optimize performance for customers, the Otto Group has been partnering with Covariant, the world’s leading artificial intelligence (AI) Robotics company. The goal of the partnership is to install hundreds of AI robots in the fulfillment centers of the retail and services group, starting with the Haldensleben and Altenkunstadt locations.

These self-learning robots can autonomously handle dynamic and unpredictable fulfillment scenarios and are expected to automate a variety of manual fulfillment tasks that require hand-eye coordination and object handling. The implementation will ensure more reliable delivery times and a general improvement in the overall performance of the respective fulfillment centers, thereby strengthening the logistics sector in Germany.

Beyond logistics, artificial intelligence is of great importance to the Otto Group. The Group has been using AI to enhance its range of services for many years. This includes sales forecasting, speech-based text processing such as chatbots and voicebots, and image analysis and processing. These specific forms of AI have been a natural part of the Otto Group’s business processes for years.

In recent months, the potential of generative artificial intelligence has become visible in society. Enormous computing power and the resulting access to huge amounts of information enable completely new forms of interaction with AI – with numerous potential applications. OpenAI with ChatGPT as one of the best known AI systems and Google are pioneers in this field. The Otto Group already has numerous use cases in the testing and experimentation phase. Given the rapid pace of development, the goal is to implement them shortly, as soon as important open questions have been answered and the legal framework, especially with regard to data protection conditions, has been sufficiently clarified.

Another focus of the Otto Group in the 2023/24 financial year is the further development of the relatively young business area of digital health, which now includes Medgate, a leading provider of digital health services, Betterdoc, the market leader in the search and referral of highly specialized doctors, as well as the online medical supply store Claravital. The Otto Group considers itself in an exceptional position to play a major role in the growing market for digital health services.

As previously announced, operations of myToys.de GmbH will be discontinued by the end of February 2024. Mytoys has not been able to generate profits in recent years and has consistently been in the red. The Mytoys brand will be continued on otto.de in the future.

On the way to a circular economy

It remains a clear goal of the Otto Group to continue to act responsibly and set an example for the benefit of people and nature. The aim is to make the business models of the Otto Group environmentally friendly and progressively circular – what is known by the keyword: Circular Economy. This is in line with the results of the recently published sixth trend study: According to the study, 68 percent of respondents want to see climate neutrality as the ethical standard for consumption, and are calling on brands and companies to become drivers of change towards climate neutrality. Circular approaches are increasingly seen as a solution on the way to achieving this goal.

The Otto Group sees this as a mandate to further strengthen its long-standing commitment to environmental protection and nature conservation, which has been embedded in the company’s goals for decades. The driving forces behind the measures and activities in the circularity area consist of the Otto Group companies, which are already implementing specific circular solutions. For example, Bonprix offers Cradle to Cradle Certified® textiles, while OTTO has launched the first “Circular Collection” on the market in collaboration with the startup Circular.Fashion. Another one is planned for fall 2023.

The Otto Group has made further progress towards its current climate targets – a 40 percent reduction in CO2e** emissions by 2025 and climate neutrality in its own operations by 2030. In 2022, the reduction achieved reached 21 percent compared to 2018. In addition, the Otto Group is setting even more ambitious climate targets across its value chain, in line with the 1.5 degree Celsius goal of the Paris Agreement. These new science-based targets (SBTs) are currently being validated through the SBT Initiative and will take effect once the process is complete.


Given the uncertain economic framework conditions, the Group is allocating its resources even more systematically in the current financial year. The focus is on consistent earnings- and liquidity-driven actions, while concentrating on providing the best possible service to customers.

The goal of the Otto Group for the current 2023/24 financial year is to prudently push ahead with relevant strategic investments in order to optimally position the Group for the future, take advantage of market opportunities, and strengthen the Group’s financial stability and good credit metrics.

Alexander Birken: “In the current financial year, we are confronted with continuing uncertainties and major challenges. However, we are adapting quickly and flexibly to new market situations, which strengthens us for the future. Accordingly, despite volatile and adverse framework conditions, we expect a stable revenue level and an EBIT in the low three-digit million euro range for the Group in the 2023/24 financial year.”

* Revenue growth adjusted for exchange rate effects and effects from changes in the business portfolio of the Otto Group in the 2021/22 and 2022/23 financial years.

** CO2 equivalents (CO2e) is a unit of measurement used to standardize the climate impact of different greenhouse gases

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About Otto Group

Founded in 1949 in Germany, the Otto Group is today a globally operating e-commerce and service group with around 41,000 employees in 30 significant corporate groups, primarily present in the three economic areas of Germany, the rest of Europe, and the USA. Its business activities extend to the Platforms, Brand Concepts, Retailers, Services, and Financial Services segments. In the 2022/23 financial year (28 February), the Otto Group generated revenue of EUR 16.2 billion. With online sales of around EUR 12 billion, the Otto Group is among the world’s largest online retailers. The Group’s main strength is its broad-based presence with various ranges of products for diverse target groups in important regions around the world. A number of strategic partnerships and joint ventures offer the Otto Group outstanding conditions for the transfer of know-how and the use of synergy potential. A high degree of entrepreneurial responsibility and the Group companies’ willingness to collaborate guarantee both flexibility and customer proximity along with optimal appeal to target groups in each country.