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Highlights
- Kogan’s adjusted earnings dip 37.5% due to tech hiccups
- Mighty Ape not expected to turn profit until FY26
- Signs of recovery emerge as marketplace expansion continues
Kogan.com (ASX:KGN), a major player in the Australian e-commerce space and a constituent of the ASX200, has reported a significant earnings downturn, largely attributed to a troubled digital upgrade within its New Zealand-based subsidiary, Mighty Ape.
In its latest trading update, Kogan.com revealed a 37.5% year-on-year drop in adjusted earnings to $6.8 million for the four months ending April. The earnings slump follows a problematic website platform upgrade implemented by Mighty Ape in February, which disrupted online operations, hindered sales performance, and inflated inventory levels.
Despite the short-term setback, Kogan.com pointed to "early signs of recovery" as technical issues have begun to ease and the Mighty Ape Marketplace continues to scale. Management highlighted that gross sales are now showing positive momentum, especially as the revamped platform stabilizes and user engagement strengthens.
“Mighty Ape will continue to right-size inventory levels over the coming months,” the company noted, emphasizing its commitment to operational efficiency while navigating the ongoing recovery.
The overall group revenue declined slightly by 0.7% during the period. While Kogan.com itself recorded a healthy 8.4% revenue growth, this was offset by a downturn at Mighty Ape. Customer activity also reflected the platform challenges, with Mighty Ape’s active customer base falling 1.8% to 695,000.
Looking forward, the company stated that Mighty Ape is not expected to return to profitable trading until FY26, underlining the long-term nature of its recovery roadmap. However, optimism stems from the marketplace’s increasing scale, which may support gradual revenue rebuilding.
For market watchers tracking e-commerce and digital transformation plays within the ASX200, Kogan.com’s situation serves as a reminder of the operational risks that accompany large-scale tech upgrades. Yet, as the dust settles, the company’s improving gross sales and customer engagement trends offer a potentially positive sign.
Investors and income-focused readers keeping an eye on leading ASX dividend stocks can follow Kogan’s performance closely. Meanwhile, for broader market performance and trends involving the ASX200, further insights can be found here:.
As Kogan.com navigates post-upgrade turbulence, its gradual return to steadier footing will be key to determining its near-term market positioning within Australia’s competitive online retail landscape.
