On January 21, British luxury brand Burberry announced that its retail comparable store sales rose 3% year on year in the third quarter of fiscal year 2026, covering the 13 weeks ended December 27, 2025. This marks a second consecutive quarter in which all regions posted flat or positive growth, continuing the sequential improvement seen from the previous quarter.
Retail revenue reached £665 million at reported exchange rates, representing a 1% increase year on year. At constant exchange rates (CER), sales grew 3%. The impact from retail space was neutral, while currency movements had an approximately 2% negative effect.
Improved Quality of Revenue and Revised Markdown Strategy
One of the key features of the quarter was an improvement in the quality of revenue. Compared with the prior year, Burberry returned to a shorter and more restrained markdown period, resulting in a healthier sales mix across all channels and regions. The outerwear and festive campaigns rolled out during the holiday season, supported by experiential activations in key markets, further strengthened brand momentum.
Hero categories such as outerwear and scarves continued to deliver double-digit growth. This product momentum is now extending into handbags and ready-to-wear.
Greater China and Asia Pacific Drive Regional Performance
By region, Greater China led performance with comparable store sales up 6% year on year, doubling the growth rate from the previous quarter. Local customer spending was the primary driver. Asia Pacific recorded a 5% increase, with South Korea rebounding strongly at up 13%. Japan posted 2% growth, in line with the previous quarter, despite softer tourist demand.
The Americas saw a 2% increase, supported by growth among both new and existing customers. EMEIA (Europe, Middle East, India and Africa) was flat, as local demand offset the continued impact of declining tourist spend.
Growth in Gen Z Customers and Improved Retail Productivity
Looking at customer dynamics, Burberry recorded double-digit growth among Gen Z customers in Greater China and Asia Pacific, with reach among younger consumers continuing to strengthen across all regions. Retail productivity also improved, driven by enhanced visual merchandising, globally consistent festive activations, and the continued rollout of scarf bars, which reached 190 stores during the period and are expected to expand to 200 by year end.
Commenting on the results, Chief Executive Officer Joshua Schulman said: “During the festive quarter, we continued to build momentum with our Burberry Forward strategy, delivering sequential improvement in comparable sales growth and an improved quality of revenue across channels and geographies. Our customers responded to our immersive Timeless British Luxury campaigns and experiences while the continued strength in our core outerwear category is now extending into accessories and ready-to-wear. As we move into 170 years of Burberry, these results reaffirm the enduring strength of our iconic brand and give us confidence in the path ahead.”
FY26 Outlook: Profit Expected to Align with Market Consensus
For the full fiscal year 2026, Burberry expects adjusted operating profit to be broadly in line with market consensus. While currency headwinds are projected to have a negative impact of approximately £50 million on revenue and around £5 million on adjusted operating profit, the company emphasized its focus on improving the quality of earnings as it seeks to drive sustainable growth and long-term value creation.
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