Hennes & Mauritz (HM) Q4 2025 earnings summary

Executive summary

• Sales in local currencies increased by 2% for both Q4 and the full year, with operating profit up 38% in Q4 and operating margin rising to 10.7% in Q4 and 8.1% for the year, driven by improved customer offering, cost control, and inventory efficiency.

• Earnings per share increased by 5% year-over-year, reaching SEK 7.58.

• CO2 emissions in Scope 3 reduced by 30% since 2019, with continued recognition for sustainability leadership and progress toward long-term climate targets.

• Net sales in SEK were negatively impacted by currency effects, with Q4 net sales at SEK 59,221m and full-year at SEK 228,285m.

• Store portfolio optimization continued, with 152 net closures and expansion in growth markets including Brazil.

Financial highlights

• Q4 gross profit: SEK 33,084m (gross margin 55.9%), up from 54.6% last year; full-year gross profit: SEK 121,821m (gross margin 53.4%).

• Q4 operating profit: SEK 6,364m (operating margin 10.7%), up from 7.4% last year; full-year operating profit: SEK 18,395m (operating margin 8.1%), up from 7.4%.

• Inventory productivity improved, with stock-in-trade at 15.5% of sales, down from 17.2%.

• Selling and administrative costs decreased by 3% in Q4.

• Currency translation negatively impacted reported numbers, with a 7% effect in Q4.

Outlook and guidance

• 2026 focus on profitable, sustainable growth, continued cost control, and expansion in growth markets like Brazil and Latin America.

• CapEx guidance for 2026 is SEK 9–10 billion, with investments shifting from logistics to tech infrastructure and store portfolio.

• Sales and admin costs targeted to grow at low single-digit levels; currency volatility and cost pressure from tariffs and tech investments remain risks.

• Sales for Dec 2025–Jan 2026 expected to decrease by 2% in local currencies due to strong Black Friday sales and calendar effects.

• Store optimization expected to have a slightly positive sales effect in 2026.