Burberry Revenue Dips, But CEO Affirms Brand Strength

Burberry Group PLC (LON: BRBY) released interim results for the 26 weeks ended September 27, 2025, showing a slight revenue decline but signs of progress in its “Burberry Forward” strategy.

The luxury brand is navigating a challenging environment while working to reignite brand desirability and customer engagement.

Revenue came in at £1.032 billion, a 5% decrease compared to the £1.086 billion reported for the same period last year. On a constant exchange rate (CER) basis, the decline was 3%. Despite the revenue dip, retail comparable store sales were flat, with a return to growth in the second quarter (Q1 -1%, Q2 +2%).

Adjusted operating profit reached £19 million, a significant improvement from the £(41) million loss in the prior year. This translates to an adjusted operating margin of 1.9%, a 570 basis points increase. Adjusted diluted earnings per share stood at 0.6 pence, a substantial jump from the (18.3) pence loss in 2024.

The company reported an operating loss of £(18) million, reflecting a restructuring charge of £37 million. Reported diluted loss per share was (7.1) pence. Free cash flow was negative £50 million, an improvement from the negative £184 million in the previous year.

Driver Breakdown:

• Brand Desirability: Strengthened through “Timeless British Luxury” expression and storytelling.
• Product Offer: Strong response to Autumn/Winter 25 collections, extending momentum to various categories.
• In-Store Experience: Enhanced with elevated product displays, cross-category merchandising, and new clienteling tools.

AskTraders Takeaway:

The flat comparable store sales, with Q2 growth, suggest the turnaround strategy is gaining traction, potentially reducing downward pressure on the stock. However, the continued revenue decline and negative free cash flow could limit upside potential in the short term.

CEO Joshua Schulman stated, “One year into Burberry Forward, my belief in this extraordinary British luxury house is stronger than ever… we now have proof points that Burberry Forward is the right strategic path to restore brand relevance and value creation.” He added that the company moves forward with confidence that Burberry's best chapters lie ahead.

The company's outlook for FY26 acknowledges the early stages of the turnaround and the uncertain macroeconomic environment. Focus remains on building brand desire to grow topline revenue this year.

Burberry expects margin improvement through simplification, productivity, and cash flow management, positioning the business for a return to sustainable, profitable growth.