Asos has announced a one-off impairment charge of £200m after deciding to idle its large US warehouse near Atlanta, Georgia, in a bid to cut costs and boost profitability.
Later this year, the online fashion retailer’s US customers will be served from its automated UK distribution center in Barnsley and a smaller, more flexible facility in the US.
The closure of the Union City site is expected to boost Asos’ pre-tax profits by £10m to £20m from 2026, although it will also result in an impairment charge of £190m this financial year. The news sent Asos shares rising 6.5 percent on the day, despite a decline of more than 85 percent in the past five years.
Although Asos’ US arm has remained profitable, the company recognized that neither US demand nor inventory levels could justify maintaining a large-scale warehouse. Competition from fast-fashion challengers Shein and Temu has increased, while rival Boohoo also retreated by closing its own US site. According to Asos, the plan to serve US customers from Britain and a smaller US facility will increase product variety and reduce fulfillment costs, although customers will experience slower delivery times.
Asos said only seven direct employees will be affected by the closure, while logistics partners aim to redeploy hundreds of staff to neighboring locations. The move follows a series of “medicinal” actions prescribed by CEO José Antonio Ramos Calamonte to stem losses and reset the retailer’s business model. The strategy emphasizes lower inventory levels, fewer discounts and a test-and-react approach to inventory.
The shuttered Union City warehouse first opened in 2018 under former CEO Nick Beighton, who viewed it as a landmark investment for Asos’ North American expansion. Analysts at Panmure Liberum suggest the closure signals “an acceptance of reduced long-term ambitions” for Asos in the US. Others, such as Deutsche Bank, still see “a big opportunity” for international growth in both the US and Europe, where Asos will retain local infrastructure.