Finance
UK's Card Factory warns on profit as weak sales dim holiday outlook
Published by Global Banking and Finance Review
Posted on December 12, 2025
Last updated: January 7, 2026
Global Banking and Finance Review
Company
Published by Global Banking and Finance Review
Posted on December 12, 2025
Last updated: January 7, 2026
Dec 12 (Reuters) - British retailer Card Factory warned of lower annual profit on Friday due to weak UK store sales that have persisted into the critical holiday shopping season, a grim update that sent its shares tumbling as much as 27%.
The seller of soft toys, gifts, Christmas cards and decorations, which operates more than a thousand stores across Britain and Ireland, said weak consumer sentiment in recent months had hit shopping behaviour and hurt high street footfall.
"Those conditions have persisted as we moved into our most important trading period, leading to a UK store sales performance, which is lower than our previous expectations," the company said.
Retailers had a particularly bad month in October, according to official data on Friday that showed the UK economy shrank unexpectedly in the three months to October.
Panmure Liberum analyst Wayne Brown said the company's update came as a "shock warning that surprises in scale", raising questions over whether its shift toward celebration products has made it more exposed to economic cycles.
SLOW FESTIVE START
Card Factory's shares dropped to a more than three-year low.
A Barclays survey on Tuesday showed that Britons were conservative with their spending in November and Black Friday ahead of the UK budget, though a PwC survey on Friday expected holiday spending to pick up despite a slow start.
Card Factory forecast a 9% to 16.6% drop in adjusted pretax profit to between 55 million pounds and 60 million pounds ($73.59 million-$80.28 million) for the year to end-January 2026.
It previously expected earnings to grow by a mid-to-high single-digit percentage, underpinned by expectations of strong Christmas sales.
Rival online gift retailer Moonpig, on the other hand, reported strong half-year revenue growth on Wednesday and a good start to the second half, including Black Friday.
($1 = 0.7474 pounds)
(Reporting by Simone Lobo and Yadarisa Shabong in Bengaluru; Editing by Subhranshu Sahu and Joe Bavier)
Adjusted pretax profit refers to a company's earnings before tax, adjusted for certain items that may not reflect its ongoing operations, providing a clearer picture of its financial performance.
Consumer sentiment is a measure of how optimistic or pessimistic consumers are regarding their expected financial situation and the overall economy, often influencing their spending behavior.
High street footfall refers to the number of people visiting retail locations on main streets, which is a key indicator of consumer activity and retail performance.
A Barclays survey is a research tool used by Barclays Bank to gather insights on consumer behavior, spending habits, and economic outlook, often influencing financial strategies.
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