British fashion retailer Next plc has upgraded its financial outlook for FY2026-27 after delivering a stronger-than-expected second-quarter performance. Robust full-price sales, favourable summer weather in the UK, improving demand across international markets, and higher returns from targeted marketing investments prompted the retailer to increase its revenue and profit forecasts for the year.
The improved Next FY2026-27 outlook reflects continued momentum across both domestic and overseas operations, with the company now expecting full-price sales to reach £6.0 billion (approximately $6.9 billion), representing a 6.3% year-on-year increase. Total group sales, including markdowns and investment-related income, are forecast to climb to £7.5 billion ($8.63 billion), up 6.6% from the previous fiscal year.
Next also expects post-tax earnings per share (EPS) to rise to 812.9 pence, an increase of 9.2% compared with the previous year.
Second-Half Guidance Remains Unchanged
Despite the stronger first-half results, the retailer maintained its expectations for the second half of the financial year. The company continues to project 5% growth in full-price sales, with UK sales expected to increase by 2.8% and international sales forecast to grow by 14%.
Next noted that international growth comparisons will become more challenging during the second half due to the successful rollout of its ZEOS distribution services last year. The logistics platform significantly improved product availability across the company’s European marketplace operations, creating a higher comparison base.
Profit Forecast Increased
Following the stronger trading performance, the retailer lifted its full-year pre-tax profit forecast by £25 million ($28.8 million) to £1.243 billion ($1.43 billion). The revised guidance represents an expected 7.3% increase over the previous year.
According to the company, approximately £15 million of the additional profit is expected to come from stronger full-price sales, while a further £10 million reflects better-than-anticipated returns from its equity investment portfolio.
Q2 Performance Surpasses Expectations
For the 13-week period ending 1 August 2026, Next reported 9.2% growth in full-price sales, significantly outperforming its earlier guidance of 4%.
Sales exceeded internal forecasts by approximately £70 million ($80.5 million). Of this amount, £19 million ($21.9 million) came from the UK market, while international operations contributed £51 million ($58.7 million), highlighting the retailer’s expanding overseas business.
The company attributed the stronger performance to weather conditions in the UK that closely resembled last year’s exceptionally warm summer, helping drive seasonal purchases. Sales also benefited from a recovery in consumer demand across the Middle East and Northern Europe, where trading had been softer during the first quarter.
In addition, Next increased investment in high-performing marketing campaigns, generating stronger customer engagement and higher sales conversions.
International Online Business Continues to Lead Growth
During the first six months of the financial year, full-price sales increased by 7.7%, reinforcing the positive Next FY2026-27 outlook.
Within the UK, full-price sales grew 3.6%, supported by a 7.4% rise in online sales. Physical retail stores, however, continued to face pressure, with store sales declining 1.7% during the same period.
International e-commerce remained the retailer’s strongest-performing channel, with online sales outside the UK surging 23.9% year on year. The continued expansion of digital operations and international logistics capabilities is expected to remain a key driver of future growth.
Looking ahead, Next believes its combination of disciplined inventory management, targeted marketing investment, expanding international operations, and digital retail strategy positions the business well for sustained growth despite ongoing economic uncertainty and changing consumer spending patterns.
