UPDATE 2-Luxury handbag maker Mulberry returns to sales growth as turnaround accelerates 

British luxury handbag maker Mulberry reported ‌a return to annual sales growth on Monday as its turnaround gathered pace despite weakening consumer spending facing the wider retail sector, sending its shares up nearly 8%. The company posted full-year revenue ‌growth of 5.7% on a constant currency basis for the year ended March 28, ‌driven by double-digit growth across all markets in the second half, with like-for-like retail and digital sales in its core UK market rising 13.7%. Mulberry's performance stands out against a backdrop of a struggling broader retail sector as ⁠cautious ​UK consumers increase savings amid ⁠sluggish economic growth, while demand has been slow to recover in key luxury market China. Recent fallout from the ⁠Iran war has also hit high-margin airport retail and demand in the Gulf.

Under CEO Andrea Baldo, ​the company has pursued its strategy focusing on an appeal to "British heritage" to win ⁠domestic customers as it cuts back on discounts, which helped to increase gross margin in fiscal 2026. Baldo, who took ⁠over ​as CEO in 2024 and also planned to scale back in China, said the turnaround was firmly underway despite challenging economic and geopolitical conditions.

Targeted investments and strategy helped ⁠its Bayswater Limited Edition bag sell out within minutes in February, while the Boston bag performed ⁠strongly, driving what ⁠the company called "sustained momentum" across regions. Notably, like-for-like retail and digital sales grew 20.1% in the United States and 37.8% in the European Union.

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