Hennes & Mauritz (HM) investor relations material

Executive summary

• Sales grew by 2% in local currencies in Q3 2025, despite a 4% reduction in store count year-over-year, driven by strong online performance and improved customer offer.

• Operating profit increased 40% in Q3 to SEK 4,914m, with an operating margin of 8.6%, reflecting supply chain improvements and positive currency effects.

• Inventory levels decreased by 9% year-over-year due to better demand planning and a successful summer sale.

• Expansion into Brazil began with two stores and online presence, with further growth planned in Latin America.

• Sustainability leadership recognized, ranking first among 200 major fashion brands for public disclosure on decarbonization.

Financial highlights

• Q3 net sales: SEK 57,017m (down from SEK 59,011m); nine months: SEK 169,064m (down from SEK 172,285m).

• Q3 gross profit: SEK 30,143m (margin 52.9%); nine months: SEK 88,737m (margin 52.5%).

• Q3 operating profit: SEK 4,914m (margin 8.6%); nine months: SEK 12,031m (margin 7.1%).

• OPEX decreased by 1% in local currency, reflecting broad cost efficiencies despite inflationary pressures.

• Cash flow from operating activities: SEK 9,985m in Q3, SEK 22,714m for nine months.

Outlook and guidance

• September sales expected to be flat year-over-year, with high comparatives from last year.

• Q4 external factors (currency, freight, raw materials) expected to be slightly positive but less so than Q3, with tariffs becoming a more significant headwind.

• Markdowns as a percentage of sales in Q4 expected to be higher due to Black Friday timing.

• Store portfolio optimization to continue, with specific 2026 outlook to be provided in the Q4 report.