5 November 2026
If you are covering Next's latest financial results, please find below a comment from Mamta Valechha, consumer discretionary analyst at Quilter Cheviot:
"Next keeps on delivering with yet another beat on expectations in its third quarter trading update. For the quarter to the end of October, full price sales were up 8.1%, well ahead of the company's own guidance of (5.8%) and the market's (7.2%). All the outperformance has come from the International business which grew 32.2%, driven by more profitable marketing, and it is a key driver of the upgrade to full year sales guidance (7.3% from 6.7%).
"Profit guidance for the full year is kept unchanged as it is being offset by the new EU tariff regime, which imposes additional costs on online orders that are placed in the EU, when the stock to fulfil the order is coming from outside the EU. Although Next has inventory within the EU with its partner ZEOS, some are still being fulfilled from the UK, which will incur the costs. Overtime Next expects to fully mitigate these though adapting their operations and modest EU price increase.
"Within the UK, growth slowed to 2% as good sales via online (4.4%) was offset by a decline in retail stores (-1.7%), as the UK consumer continues to see weak sentiment and the unseasonably warm weather in September put off the wardrobe switchover for many, before recovering in October.
"Given Next's success, its share price has rerated of late, and its valuation is at a premium to its history, although this is all well justified. There are very few high-quality retailers like Next, globally, and it is entering the Christmas period in a very good shape."
