Key facts
- Burberry's revenue increased by 5% in the three months to July.
- The Americas region saw double-digit sales growth, while China experienced a 9% increase.
- Retail revenue grew to £455m from £433m.
- Sales in Europe and the Middle East declined by 3% due to reduced tourist spending.
- Burberry is undertaking a restructuring plan to achieve £100m in cost savings over two years.
Burberry has reported a five percent increase in overall revenue for the three months ending July, marking the first time in three years that sales have grown across all its fashion lines. This revival is largely attributed to a significant boost in sales in the Americas and a nine percent jump in its crucial China market. Retail revenue climbed to £455 million from £433 million.
Chief executive Joshua Schulman highlighted the success of the 'Portraits of an Icon' campaign in attracting new customers to the brand's outerwear. The company's strategy appears to be working, drawing in a diverse range of luxury customers across various product categories. This positive performance comes as Burberry continues a comprehensive two-year turnaround plan aimed at refreshing the heritage brand after a period of declining sales.
However, the company's European and Middle East division experienced a three percent year-on-year sales decline. Burberry attributed this slowdown to reduced tourist spending, exacerbated by the ongoing conflict in Iran. Despite this regional dip, Burberry reiterated its full-year guidance, while acknowledging that the uncertain geopolitical and macroeconomic climate could impact consumer confidence if the war persists.
The sales uplift coincides with a substantial restructuring initiative at Burberry, which targets approximately £100 million in cost savings over two years. This turnaround plan, initiated last year, includes a reduction in headcount by about a fifth. The company anticipates securing nearly all of these savings by the end of 2026, with an additional 20 percent expected next year.