Zalando AI Shopping Agent Unveiled as Q3 Gross Margin Slips

What Zalando announced

Zalando, Europe's biggest online fashion retailer, chose its third-quarter earnings day to show its first AI shopping agent. The product is called Zalando Extended. It is meant to let customers buy goods from other online retailers without leaving the Zalando app, while an AI agent completes the purchase for them in the background.28 A pilot is already running with the home furnishings retailer Westwing.14

The timing tells part of the story. On the same day, Zalando reported a third-quarter gross margin of 38.7%, down 0.9 percentage points from a year earlier. Analysts at Jefferies and JPMorgan said the figure missed expectations.1 Consensus had been 39.9%.1316 The company was effectively offering investors a future in agentic commerce at the moment its current retail economics looked weakest.

Unveiled now, live in 2027

Much of the coverage described the agent as "launched," and readers should be careful with that word. Several outlets reported that Zalando launched its first AI shopping agent on Tuesday.714 The details in those same reports tell a different story. Reuters said AI-assisted checkout on Zalando Extended is planned for 2027, with the Westwing pilot as the only live piece so far.2 Germany's dpa-AFX agency also said the launch is set for next year.8 The fairest reading is that Zalando unveiled the product and began a limited test. Customers cannot yet use it at scale.

The pitch is aimed at partner retailers as much as shoppers. According to dpa-AFX, Zalando says partner shops can reach its customers and earn new revenue without complex technical integration or changes to their logistics, because the agent does that work.8 That is a notable claim. Zalando's existing partner programme requires merchants to connect to its systems. A system where the agent handles checkout on the partner's own site would remove much of that onboarding work.

In its earnings presentation, management said agentic commerce opens new customer journeys and that Zalando is "at the forefront."17 On the earnings call, the company again pointed to Zalando Extended as its main example of a new growth opportunity.12

The margin squeeze behind the headline

The financial results were mixed rather than bad. Revenue rose 5.1% to €3.17 billion, slightly above the €3.15 billion analysts polled by LSEG expected. Gross merchandise value rose 7.5% to €4.54 billion.1 Adjusted EBIT rose 10.6% to €107 million, lifting the adjusted margin to 3.4%.15 The company also said active customers reached a record 63.2 million.16

The weakness was in the consumer business. CFO Anna Dimitrova said the gross margin fell mainly because of targeted investments in attractive offers in Zalando's own retail business, especially sneakers.1 Put plainly, Zalando discounted to clear stock. B2C adjusted EBIT fell 15.9% to €64 million, and that segment's margin narrowed from 2.8% to 2.3%. Higher marketing spend was another factor, including an earlier autumn/winter campaign and activity around the World Cup.11 The group also reported a net loss of €18 million, compared with a €12.5 million profit a year earlier.13

The clearance worked on its own terms. Jefferies noted that inventory fell to 18.4% of trailing twelve-month sales, from 21.8% a year earlier.13 Management said it went into the fourth quarter with healthy stock levels.12

The business-to-business side was the bright spot. B2B revenue grew almost 28% to €354 million, and adjusted EBIT in that segment more than doubled to €42 million.15 Dimitrova argued that the shift to a platform model is speeding up, with the partner business and retail media both growing at double-digit rates.3 The partner share of B2C GMV rose to 33.6%, and retail media revenue grew nearly 18%.15

One outlet attributed the margin decline mainly to Zalando's technology investments.5 The company's own breakdown does not support that. It attributes 0.6 points of the drop to B2C discounting and 0.2 points to a mix effect from the faster-growing, lower-margin B2B business.12 Zalando called the decline temporary and still expects a broadly flat gross margin for the full year.1 It also kept its full-year guidance of €680 million to €720 million in adjusted EBIT.13

Why investors reacted unevenly

Reports of the share price moves differ, which suggests a nervous, choppy trading day. Several reports said the shares fell about 5% in early trading.316 A later Reuters update said the stock recovered after Dimitrova's comments and was up 0.5% by around 09:45 GMT.2 dpa-AFX described the shares as volatile, saying they fell sharply at the open and then rose more than 2%. It suggested early profit-taking after a strong run.8 Later market data showed the stock down about 4.9% again.8

The most useful line of the day came from JPMorgan. The bank warned the stock could drift lower because there were no new positives and because of "ongoing structural risk from agentic commerce development."2 JPMorgan's Georgina Johanan repeated that concern about structural risk from AI shopping agents.8 Deutsche Bank's Adam Cochrane focused on a more immediate issue: weaker consumer profits could weigh on the rest of the year.8

The real fear: becoming a back-end supplier

JPMorgan's warning matters because it points to the main threat. If AI agents compare prices across retailers and pay for shoppers, the storefront where people discover products loses value.1 An aggregator like Zalando earns money because shoppers start their search in its app. If a general-purpose agent from Google, OpenAI or Amazon becomes the starting point, Zalando risks ending up as just another catalogue those agents search.

That risk is already showing up across the industry. In January, Google launched its Universal Commerce Protocol with Shopify, Walmart, Target and others. Zalando was listed among more than 20 companies endorsing it.22 Google's Universal Cart, which follows shoppers across Search, Gemini, YouTube and Gmail, moves the decision to buy away from retailers' own sites.22 Amazon has blocked several outside agents from its store, including Meta's Muse, while running its own shopping agents.22

Seen this way, Zalando Extended is a defensive move. Zalando wants to be the agent rather than the merchant an agent buys from. Bringing other retailers' goods into its own app is a bet that a fashion-focused agent with 63 million customers can hold onto the starting point that general AI assistants want to take.

The payments angle

The hard part of Zalando's plan is checkout. Paying on a customer's behalf at another retailer is the most heavily regulated step in agentic commerce, and the infrastructure for it is still being built.

Visa and Mastercard have both built programmes for agent-initiated payments. They rely on tokenised credentials, agent registration and spending controls.24 Europe is relevant here. In July 2026, Visa said it was running live agent transactions with more than 30 European issuers at merchants such as lastminute.com and Frasers. Visa Payment Passkeys secured those payments to meet strong customer authentication rules.26 Mastercard added a score in September estimating whether an AI agent started a transaction, but it is only being tested in the US.29

Liability is still unclear. Under Visa's rules, an agentic payment provider is treated as the cardholder for an agentic transaction. There is also no specific dispute reason for purchases made by agents.26 A Zalando-style agent buying from Westwing would therefore raise practical questions about who handles returns, refunds and chargebacks.

Consumers are hesitant too. Visa's CEO has said that roughly three-quarters of US consumers do not trust agentic platforms to pay on their own.23 Merchants are not ready either. Only 19% of merchants surveyed in an industry report said they could accept agentic AI payments.26 Even OpenAI retired ChatGPT's Instant Checkout about six months after launching it and sent shoppers back to merchants' own sites.22

The verdict

Zalando's announcement makes strategic sense, but it gives investors little in the short term. The quarter showed that the platform model is working: B2B, partner sales and retail media are carrying profit growth while the owned retail business gives up margin through discounts.1115 Extended fits that model, since it adds selection without adding inventory.

Still, a product that arrives in 2027, with one pilot partner and payment infrastructure that is still being tested, does not answer JPMorgan's concern this year. The more likely outcome is that Zalando's value depends on whether it can keep shoppers starting in its own app before AI assistants from much bigger companies become the default way to shop. Zalando has a plan to do that, but it has not yet shown it will work.