UPDATE 3-M&S expects profit recovery after cyber hack-driven slump

British retailer Marks & Spencer forecast a return to profit growth this year after it slumped 24% in 2025/26, hit by a disruptive cyberattack that dented sales and ‌margins.

The 142-year-old M&S, one of the biggest names on the UK high street, said it entered its current reporting year to March 2027 with a clear plan and a strong balance sheet and was focused on delivering further improvements to product availability and service ‌levels. "Profit growth is expected to resume versus 2024/25," it said on Wednesday.

M&S said its outlook for the current year ‌takes account of higher fuel, freight and input costs caused by the Iran war and continued government tax levies and regulatory challenges for the sector. It would mitigate these through improved buying, reinvestment in value to drive volume, and savings from its structural cost-reduction programme.

Shares in M&S were up 2% in early ⁠trading. "There is ​still so much to be ⁠done on the 'Reshaping M&S' transformation programme with plenty of self-help and market share to go after," Investec analyst Kate Calvert said.

ONLINE CLOTHING ORDERS SUSPENDED The cyberattack ⁠forced M&S to suspend online clothing orders for seven weeks and click-and-collect services for nearly four. Clothing and food availability in stores was ​also hit, while additional waste and logistics costs were incurred.

"We were laser focused on our customers, worked incredibly hard to ⁠recover our business, and we came out stronger," CEO Stuart Machin said. The group made adjusted profit before tax of £671.4 million in the year to March 28, ⁠down ​from £881.1 million in 2024/25. Second-half profit grew 4.1% from the previous year.

M&S said costs related to the cyber hack were £131.3 million. While food sales rose 7.0% and the division grew market share, sales in fashion, home and beauty slid 7.7%.

Machin said ⁠recovery in fashion, home and beauty has taken longer, "but there is strong growth potential." He also said, however, that retailers faced "a ⁠triple whammy of headwinds with ⁠increased taxation, a greater regulatory burden and ongoing global conflict."

British consumers, shaken by the inflationary impact of the Middle East conflict, cut their spending last month for the first time since November ‌2024, a survey ‌by Barclays showed last week.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)