WH Smith Defies Earlier Slump, Gains on Strong Earnings Despite Travel Volatility

WH Smith (LON: SMWH) shares fell at the open on Thursday, but have now pushed around 1.9% higher following the release of its trading update for the 26-week period ending February 28, 2026.

While the company reported a solid first-half performance, there are growing concerns regarding geopolitical instability in the Middle East and its potential impact on passenger numbers.

The Group reported a 5% increase in total revenue on a constant currency basis compared to the prior year. Like-for-like (LFL) revenue saw a more modest increase of 2%.

In the UK, total revenue and LFL revenue both increased by 2%. Air travel revenue saw a 1% increase, with LFL up 2%. Temporary store closures related to refurbishment across Heathrow Airport terminals did impact total growth. The hospital channel delivered a strong performance with total revenue up 7% and LFL revenue up 4%. Rail revenue experienced headwinds, with total revenue up 1% but LFL revenue down 2%.

North America demonstrated stronger growth with total revenue up 10% on a constant currency basis, and LFL revenue up 1%. The Travel Essentials business, a key driver in this region, saw total revenue increase by 22% and LFL revenue by 6%, thanks to new store openings and higher spend per passenger.

The InMotion business continued to struggle, reporting a 1% decline in total revenue and a 4% decline in LFL revenue. A review of the InMotion store portfolio is currently underway. The Resorts business experienced a 6% decline in both total and LFL revenue, primarily attributable to reduced visitor numbers in Las Vegas.

The Rest of the World and Other segments saw an 8% increase in total revenue and a 6% increase in LFL revenue, driven by the annualization of new store openings. The company is actively managing its international store portfolio, exiting underperforming markets.

WH Smith acknowledged the geopolitical uncertainty in the Middle East and its potential impact on passenger numbers across its key markets. The company stated it will closely monitor the situation and focus on strategic priorities and cost and cash discipline. Markets are interpreting this caution as a sign that future performance could be negatively impacted.

WH Smith is scheduled to announce its interim results on April 23, 2026. This event will be crucial for understanding the full extent of the geopolitical impact and the company’s strategies for mitigating potential risks.