In December 2023, Farfetch’s habit of losing money pushed it to the brink of bankruptcy. A year later, the London-based luxury e-tailer reached a profitability milestone.

In the final quarter of 2024, Farfetch’s adjusted earnings before interest, taxes, depreciation and amortisation reached $30 million, up from a $34 million loss during the same period in 2022. (The company stopped reporting earnings in the second half of 2023).

That bottom line boost is expected. Coupang, the South Korean e-commerce giant that acquired Farfetch in December 2023, has been judicious about cutting costs at the online luxury firm. In the last year, Farfetch has saved millions by switching logistics partners, closing unprofitable business units like its white label e-commerce software service and selling off labels from its brand incubator including Off-White and Palm Angels.

Those profits, however, have come at their own price. The e-tailer’s persistent cost cutting is hindering its ability to buck the overall luxury slowdown. Farfetch generated $471 million in net revenue in the final quarter of 2024, a 25 percent decline from the same period in 2022. (Coupang didn’t break out Farfetch’s year-over-year sales growth in its earnings). That comes as Farfetch has eliminated roles and slashed budgets that are critical for maintaining relationships with top clients, BoF reported on Tuesday. It’s also opposite to the approach taken by Mytheresa, its top competitor, which posted 13 percent year-over-year sales gains in its most recent quarter by offering its highest spending customers lavish in-person experience and exclusive capsule collections.

But Coupang’s own sales growth and its ability to drive profits at Farfetch appears to be a hit with investors. The South Korean e-commerce giant’s stock jumped 5 percent in after hours trading following the earnings release.

Learn more:

Inside Coupang’s Tug of War With Farfetch

A year into its ownership of the embattled luxury e-tailer, the South Korean e-commerce giant is whipping Farfetch into shape, reaching near breakeven in its latest quarter. But company insiders say Coupang has gone from cutting fat to cutting muscle, stripping Farfetch of its ability to compete for the attention and dollars of key ultra-wealthy shoppers who account for 30 percent of its annual sales.