Allegro, Poland's prominent e-commerce platform, has forecasted a moderation in its domestic earnings growth to a range of 4-7% for the fourth quarter. This projection was disclosed on Thursday, following the release of the company's third-quarter core profit results, which were in line with market expectations.

In the Polish market, Allegro's adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) experienced a 13.5% increase, reaching 883 million zlotys ($214.63 million). This figure marginally exceeded the 880 million zlotys anticipated by analysts based on a consensus generated by the company.

The gross merchandise value (GMV), a key industry indicator for transaction volumes, grew by 10.8% year-on-year, totaling 14.7 billion zlotys in Poland, its largest market.

"Polish consumers have been increasing their spending with us at the fastest annualized rate in a year, even amid signs of declining retail sales," stated Chief Financial Officer Jon Eastick.

The company attributed the anticipated earnings slowdown to the base effect of monetization strategies, increased marketing expenditures, enhanced logistics services, and team growth.

Nevertheless, Allegro indicated that its adjusted EBITDA to GMV margin is expected to exceed its medium-term target of 5.3-5.7% for the entire year.

For the October-December quarter, which encompasses the peak holiday shopping season, Allegro anticipates GMV growth in the range of 11-13%.

However, it also forecasts an adjusted EBITDA loss for its international operations between 210-230 million zlotys, which would result in a consolidated decline of 2-6%.

Having established itself as a primary shopping platform in Poland, Allegro expanded its regional presence by acquiring Mall Group in 2022, subsequently launching its marketplace platforms in the Czech Republic, Slovakia, and Hungary.

While this acquisition broadened its reach and provided access to 32 million potential customers, Allegro's international operations have thus far hindered its profitability as it works to revamp the Mall legacy business and invest in new marketplaces.

Allegro reported that the number of active buyers on its platforms in the Czech Republic and Slovakia has reached 2.8 million, with a quarter-on-quarter increase of 8% in gross merchandise volume (GMV) for these markets. 

In a statement, CEO Roy Perticucci indicated that Allegro is preparing to launch operations in Slovenia and Croatia, expected to take place in the upcoming quarters.