Burberry can significantly reduce its half-year loss

The British fashion group Burberry Group Plc presented its results for the first half of the 2025/26 financial year on Thursday. The company again had to report losses in sales and red numbers, but was also able to point to progress in its reform strategy. It achieved its first like-for-like sales growth in its own retail business in two years and was able to significantly reduce its losses.

In the 26 weeks to September 27th, group sales amounted to 1.03 billion British pounds (1.17 billion euros). This corresponded to a decrease of five percent compared to the same period last year. Adjusted for exchange rate changes, revenue fell by three percent.

However, the company highlighted the recent upward trend: In the second quarter, like-for-like retail sales rose two percent, beating market expectations.

The net loss drops by 66 percent

Profitability also improved significantly. The gross margin grew by 410 basis points on a currency-adjusted basis to 67.9 percent. This was mainly due to the absence of one-off charges from inventory from the previous year. The operating profit adjusted for special effects reached 19 million British pounds. In the previous year, an adjusted operating loss of 41 million British pounds was recorded.

Reported operating loss, which includes one-off restructuring charges of GBP 37 million, fell 67 percent to GBP 18 million. The net loss attributable to shareholders fell by 66 percent to 26 million British pounds (29 million euros).

According to the company, this improved profitability was due to strict financial discipline. The most recent one-off charges resulted primarily from the plan to cut around a fifth of the workforce as part of the ongoing savings program.

CEO Schulman sees the group on the right path

For CEO Joshua Schulman, the current figures show the effectiveness of the reform concept: “We now have evidence that ‘Burberry Forward’ is the right strategic path to restore brand relevance and create value,” he said in a statement.

“Thanks to the coherence of our ‘Timeless British Luxury’ brand promise and an enhanced product offering, we are seeing customers return to the brand they love. This has resulted in like-for-like retail sales growth for the first time in two years,” said Schulman. “We look to the future with confidence because the best chapters of Burberry are still ahead of us.”

There were positive signs in the outerwear category, which, according to the group, exceeded expectations in the reporting period. The demand for accessories such as scarves and shawls also grew. In the leather goods sector, developments continued to be “challenging”, but showed gradual improvement.

The second quarter also saw a comprehensive upward trend in like-for-like retail sales. In America and Greater China they increased by three percent each, and in the EMEIA region, which includes Europe, the Middle East, India and Africa, an increase of one percent was achieved. In Asia Pacific markets outside China, they remained unchanged compared to the same period last year.

Burberry is counting on the effects of the reform program

With a view to the entire 2025/26 financial year, Burberry continues to rely on the effects of the ongoing reforms. The company expects continued margin improvement through its cost efficiency program. According to the plans, it is expected to achieve savings of 80 million British pounds per year.

Management forecasts a mid-single-digit percentage decline in wholesale sales. This reflects a strategic realignment towards a smaller but higher quality partner network, the company explained. Despite the uncertain macroeconomic environment, the group wants to concentrate on building on the initial successes of the realignment. The aim is to rekindle brand desire and ensure a return to sustainable, profitable growth, explained Burberry.