Next raises profit forecast for fourth time this year as H1 beats expectations
Next has raised its full‑year profit guidance for the fourth time in 2026, lifting the forecast by £12 million to £1.255 billion after stronger‑than‑expected first‑half results. In the first half of financial year 2026, group sales rose 9 % to £3.54 billion and pre‑tax profit climbed 10.5 % to £569 million.
Online sales grew 7.4 % while store sales slipped 1.7 %, reflecting the shift toward digital channels; international sales jumped 24 % despite Middle‑East disruptions, driven by effective digital marketing that yielded £1.77 profit per pound spent. The company cited warehouse‑capacity investments and cost savings as contributors to the uplift. Looking ahead, Next expects its new AI tools, an AI Business Analysts agent and a Coding agent, to boost development productivity by at least 30 % over the next two years, and it believes AI could cut the cost of modernising its legacy mainframe from £50 million to £10 million. Next also trimmed its second‑half UK sales growth outlook from 2.8 % to 2 %, warning that higher taxes in the upcoming Autumn Budget could stifle growth and urging the government to control spending or stimulate the economy.
“The result of a small upgrade in sales expectations and some additional cost savings, mainly in warehousing,” Next said.
“The tax burden is at its highest level for over 60 years, and seems to us to be at the point where further increases only risk stifling growth – and lower growth is likely to only worsen Government finances – a vicious circle,” Next said.
Next has raised its profit guidance for the full year – for the fourth time this year. The company warned in February that it was expecting disruption in the Middle East to impact on its sales, with prices in that region rising because of it.
What we know
Profit guidance increased by £12 million to £1.255 billion
Total group sales rose 9 % to £3.54 billion in H1 FY2026
Pre‑tax profit rose 10.5 % to £569 million in H1 FY2026
Online sales grew 7.4 % while in‑store sales fell 1.7 %
International growth remained strong at 24 %