Finance
UK's Next lifts profit outlook on strong Christmas sales
Published by Global Banking & Finance Review®
Posted on January 6, 2026
2 min readLast updated: January 20, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on January 6, 2026
2 min readLast updated: January 20, 2026
Next increased its profit forecast after a 10.6% rise in Christmas sales, with international sales up 38.3%. However, growth is expected to slow in 2026/27.
By James Davey
LONDON, Jan 6 (Reuters) - British fashion retailer Next edged its annual profit forecast higher for the fifth time in a year as it reported a better-than-expected 10.6% rise in full-price Christmas sales, sending its shares higher in early trading on Tuesday.
Subdued consumer confidence in Britain ahead of Christmas coupled with unseasonably mild weather had left analysts nervous about clothing retailers' festive trading prospects.
However, Next defied the gloom, reporting a 5.9% rise in UK sales in the nine weeks to December 27. It said it benefited from higher stock levels than the previous year, when supplier deliveries were delayed by disruption in Bangladesh and global freight networks.
INTERNATIONAL SALES SOAR
International sales for Next, which has an online presence in more than 70 countries, jumped 38.3%, reflecting a higher-than-expected increase in marketing expenditure and improved stock availability.
Shares of Next, which has more than 800 stores in the UK and Ireland, including Reiss, Joules and FatFace outlets, surged 3.1%, extending gains over the last year to 47%.
Shares in rival Marks & Spencer, which is due to update on trading on Thursday, were down 1.4%.
Led by CEO Simon Wolfson, Next said it now expected to report pretax profit of 1.15 billion pounds ($1.56 billion) for the year to January 31, up from previous guidance of 1.135 billion pounds and 1.011 billion pounds made in 2024/25 when it breached the 1 billion pounds mark for the first time.
NEXT WARNS THAT SALES, PROFIT GROWTH TO SLOW
The retailer, however, cautioned that it expects full-price sales and profit growth to slow to 4.5% in its 2026/27 year.
It said its UK business will face tough comparative numbers, while continuing pressures on employment will likely filter through into the consumer economy as the year progresses.
Official data published last month showed Britain's unemployment rate hit its highest since the start of 2021.
"While we expect the excellent Next to continue to do better than most, this tough backdrop may make future upgrades harder to come by," Shore Capital analyst David Hughes said.
Next also expects growth from its overseas direct websites to moderate from the exceptional levels of the 2025/26 year.
($1 = 0.7377 pounds)
(Reporting by James Davey, Editing by Alexander Smith and Bernadette Baum)
Full-price sales refer to the revenue generated from selling products at their original price, without discounts or promotions.
Consumer confidence is a measure of how optimistic or pessimistic consumers feel about the overall state of the economy and their personal financial situation.
International sales refer to the revenue generated from selling products or services to customers outside of the company's home country.
Retail trade involves the sale of goods and services to consumers for personal use, typically through stores or online platforms.
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