DFS raises FY26 profit to £44.9m, lifts margin to 58.1% and reinstates dividend

DFS reported underlying profit of £44.9m for FY26, up almost 49% year-on-year. Its gross margin hit the target 58.1% while net debt fell to £69m.

Revenue grew 2.6% to just under £1.06bn, meeting the group’s 58% gross margin goal. The improved results allowed DFS to reinstate the dividend it had paused in FY25. DFS also said it gained a record 40% share of the UK upholstery market and that its Sofology brand saw orders rise 2.6% over the year and 19.3% in the second half.

“the fundamental strength, agility and resilience of the DFS Group,” Tim Stacey, Group Chief Executive Officer said.

“Uncertainty continues to influence consumer confidence and footfall, and we remain appropriately cautious regarding the broader macroeconomic environment,” Tim Stacey, Group Chief Executive Officer said.

In FY25, DFS revenue rose 4.4% to £1.03bn and underlying profit before tax nearly tripled to £30.2m. The group had previously suspended its dividend in FY25 while focusing on balance‑sheet strengthening.

What we know

DFS delivered a further improvement in profitability in FY26, with underlying profits up almost 49%, margins reaching target levels and debt falling sharply despite subdued furniture market demand.
In FY26, profitability strengthened further, with underlying profit increasing to £44.9m, margins reaching 58.1% and net debt falling to £69m.
Revenue rose 2.6% to just under £1.06bn, while the group achieved its strategic 58% gross margin target.
The improved financial performance enabled the retailer to reinstate the dividend it suspended in FY25 while management focused on strengthening the balance sheet.
The sofa specialist continued to gain market share and now claims a record 40% share of the UK upholstery market.