H&M Q4 operating profit beats estimates on improved margins, cost control

H and M Hennes and Mauritz AB

29/01/2026 07:10

Overview

Swedish apparel retailer's Q4 sales slightly missed analyst expectations

Operating profit for Q4 beat analyst expectations, driven by improved offerings and cost control

Company's Q4 gross margin improved to 55.9% from 54.6%

Outlook

H&M expects sales to decrease by 2% in Dec 2025-Jan 2026 due to calendar effects

H&M plans CapEx of SEK 9-10 bln for 2026, focusing on stores and tech infrastructure

Company aims for positive sales effect from store optimization in 2026

Result Drivers

CUSTOMER OFFERING - Improved customer offering contributed to increased operating profit, according to CEO Daniel Ervér

COST CONTROL - Good cost control helped boost operating profit, per CEO Daniel Ervér

INVENTORY PRODUCTIVITY - Improved inventory productivity supported profit growth, according to CEO Daniel Ervér

Key Details

Metric
Beat/Miss
Actual
Consensus Estimate
Q4 Sales
Slight Miss*
SEK 59.22 bln
SEK 59.45 bln (15 Analysts)
Q4 EPS
SEK 2.72
Q4 Net Income
SEK 4.33 bln
Q4 Gross Margin
55.90%
Q4 Operating Profit
Beat
SEK 6.36 bln
SEK 5.52 bln (14 Analysts)

*Applies to a deviation of less than 1%; not applicable for per-share numbers.

Analyst Coverage

The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 3 "strong buy" or "buy", 15 "hold" and 10 "sell" or "strong sell"

The average consensus recommendation for the apparel & accessories retailers peer group is "buy."

Wall Street's median 12-month price target for H & M Hennes & Mauritz AB is SEK167.50, about 5.5% below its January 28 closing price of SEK177.20

The stock recently traded at 21 times the next 12-month earnings vs. a P/E of 22 three months ago

Press Release: ID:nWkr6yXHsG

For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)