Quick Facts
- Burberry achieved 2% comparable sales growth for fiscal year 2026, with Q4 showing 10% growth in both China and Americas
- Adjusted operating profit jumped to £160 million from £26 million a year earlier, with operating margin reaching 6.6%
- The company expects £100 million in annual cost savings by fiscal 2027 through restructuring and efficiency programs
Burberry has returned to profitable growth after a challenging period, with comparable sales rising 2% in fiscal 2026 driven by strong fourth-quarter performance in key markets.
The British luxury brand reported 10% growth in both Greater China and the Americas during the quarter ended March 2026. Full-year revenue reached £2.4 billion, flat at constant exchange rates but meeting expectations.
CEO Joshua Schulman, who took the helm in July 2024, has refocused the company on its core strengths after what he called losing its way. “Burberry has authority, heritage and legitimacy as a leader in outerwear and scarves, but we had adopted a handbag-first approach,” Schulman said.
The turnaround strategy centers on returning to iconic products like trench coats and scarves featuring the Burberry Check pattern. The company has repositioned these items as center stage in stores and enhanced visual merchandising both online and in physical locations.
Financial performance showed marked improvement. Adjusted operating profit surged to £160 million from £26 million in the previous year. The operating margin expanded 570 basis points to 6.6% at constant exchange rates. Free cash flow jumped 120% year-over-year to £141 million.
Burberry is implementing significant cost reductions, targeting £100 million in annual savings by fiscal 2027. This includes organizational restructuring and up to 1,700 job cuts, building on a previously announced £40 million savings program.
Regional performance varied, with China leading growth at 6% comparable sales increase. The Americas grew 4% year-over-year, while EMEIA (Europe, Middle East, India, Africa) posted 1% growth despite reduced tourist spending.
The company reported particular success attracting Gen Z customers in China, a critical demographic for luxury brands. “Progress is being achieved by measures on any number of fronts, including the attraction of Gen Z customers despite intense competition,” said Richard Hunter, head of markets at Interactive Investor.
Analysts responded positively to the results. Citi analysts said “All boxes ticked, execution firmly on track,” while Deutsche Bank noted the sequential improvement in Greater China should provide relief for the broader luxury sector.
For fiscal 2027, Burberry expects continued revenue growth and margin expansion as the transformation strategy gains momentum. “While we are still early in our transformation, I am more optimistic than ever that Burberry’s best days are ahead,” Schulman said.
