H & M Hennes & Mauritz AB (publ) offers clothing, accessories, footwear, cosmetics, home textiles, and homeware for women, men, and children worldwide. Its product range includes sportswear, shoes, bags, ready-to-wear, activewear, jeans, interior products such as bed linens, towels, tablecloths, tableware, furniture, and lighting, as well as beauty products like make-up and fragrance collections. The company sells under brands including H&M, H&M HOME, H&M Move, H&M Beauty, COS, Cheap Monday, Weekday, Monki, & Other Stories, ARKET, and Singular Society. It also operates Sellpy, a digital platform for second-hand fashion; Smartex.ai, which detects faults in real time for textile production; Syre, focused on scaling textile-to-textile recycling primarily for polyester; and A Retro Tale, offering vintage and secondhand accessories and collecting and sorting solutions to extend the useful life of garments through reuse and recycling under the Looper Textile name. Additionally, it runs seasonal vegetarian cafés and coffee shops. Products are available through online and physical stores. Incorporated in 1943, the company is headquartered in Stockholm, Sweden.
European companies seen posting 19.4% profit growth in third quarter, but pace to slow
Analysts expect third-quarter earnings at major European companies to rise 19.4% from a year earlier, according to data published on the first of the month by LSEG's IBES. While the energy sector is the main driver, the pace of profit growth is expected to slow from the second quarter. Excluding the energy sector, companies in the STOXX Europe 600 index are seen posting profit growth of 9.9%, with consumer cyclical goods makers showing the strongest growth, followed by the technology sector. Analysts raised their profit-growth forecast for the technology sector to 23.8% from 13.1% as of July. The energy sector is expected to post profit growth of 98.6%, but that would be a slowdown from 138.6% in the second quarter, with high fuel prices supporting the strong profit growth; North Sea Brent prices rose about 14% in September, and diesel refining margins hit a record high. The real estate sector, meanwhile, is expected to see the sharpest decline, with profit down 71.4% from a year earlier. Revenue for STOXX Europe 600 constituents is seen rising 10.6%, or 4.3% excluding the energy sector, with four sectors expected to post lower revenue. Sweden's H&M, the fashion retail giant and the first index constituent to report results, beat profit expectations thanks to a temporary U.S. tariff refund, but its revenue growth was lackluster. Analysts expect fourth-quarter profit growth of 35.1% for index constituents, though the index fell 1.3% on the first day of the quarter amid rising bond yields.
H&M Q3 2026 profit surges past expectations to 6.04 billion kronor, but September sales grow just 1%
H&M, the Swedish fashion retail giant, reported third-quarter 2026 operating profit above analyst expectations after pushing ahead with cost controls and improved sourcing and purchasing efficiency, though sales growth remained sluggish amid fierce competition from Shein and Inditex, the owner of Zara. Operating profit in Q3 2026, covering the period from 1 June to 31 August 2026, rose to 6.04 billion Swedish kronor from 4.91 billion kronor in the same period a year earlier, and beat the analyst average estimate of 5.14 billion kronor. The gross margin rose to 54.0% from 52.9% a year earlier, partly helped by customs duty refunds, compared with analysts' forecast of 53.4%. However, sales have yet to show a clear recovery, with H&M expecting September sales to rise only 1% in local currencies, the same pace as in the June-to-August period. H&M shares opened down 2%. Since Daniel Ervér took over as chief executive in January 2024, H&M's profitability has steadily improved, with the company restructuring its purchasing and increasing the share of clothing bought in-season to respond faster to shifting fashion trends and weather. But inventories in the quarter rose 9% after adjusting for currency effects, which the company attributed to global supply chain bottlenecks. H&M is also stepping up logistics investment to support growing online sales, preparing to gradually bring new European warehouses into operation from this year through next year to boost distribution capacity and make goods more readily available. Meanwhile, the heir of H&M's founder has been gradually raising his stake, fueling speculation that a buyout to take the company private could be on the cards.
France begins charging fees on cheap clothing from Shein and Temu
France on Tuesday began implementing a fee system targeting extremely cheap fast fashion, in a bid to curb the surge in low-cost clothing sold on Chinese-origin online shopping sites such as SHEIN and Temu. The measure is part of the "fast fashion law" passed in June to address environmental damage caused by overproduction, imposing fees such as 0.25 euros (about $0.30) on boxer shorts and socks, and 12 euros (about $14) on coats. The fee is capped at 50% of the product's pre-tax sale price and is calculated based on the number of items offered by a brand, their prices, and ease of repair, with plans to raise it further from 2030. France is the first among European Union countries to impose penalties on retailers based on the number of products they offer online. According to SHEIN's prospectus, as of March 31 this year, it offered over 2 million items, with about 4,700 new apparel items added daily. According to authorities, European retailers such as Zara, owned by Inditex, and H&M, which offer fewer items on their sites, are not expected to be subject to the measure. SHEIN and Temu did not respond to requests for comment. China's Ministry of Commerce has expressed that the law is discriminatory and a trade barrier, potentially violating World Trade Organization principles.
Defense & Geopolitical Fragmentation › Defense Primes — United States Regulation
0625.HK · Regulation · Negative France imposes fees on Shein's products, directly increasing costs and potentially reducing sales.
HMSB.XETRA · Regulation · Positive France's fee targets low-cost fast fashion from Shein/Temu, not H&M, which offers fewer items, potentially giving H&M a competitive advantage.
IXD1.XETRA · Regulation · Positive Zara, owned by Inditex, is not expected to be subject to the fee, as it offers fewer items, potentially benefiting from reduced competition.
RBC cuts H&M and JD Sports forecasts on German consumer weakness
RBC Capital Markets has cut profit forecasts for H&M and JD Sports Fashion PLC, citing sluggish consumer demand in Germany as a growing risk for European retailers. The bank lowered its earnings per share forecasts for H&M by 2% to 3% for the 2026 and 2027 financial years, citing lower like-for-like sales assumptions and higher operating costs, and reduced its price target to SEK175 from an unspecified previous level while maintaining a sector perform rating. For JD Sports, RBC cut earnings forecasts for the 2027 and 2028 financial years by 6% and lowered its price target to 95 pence from 100 pence, after the retailer reported softer-than-expected second-quarter trading driven by slower US footwear sales. RBC noted that store sales in German fashion retail have fallen almost 4% year to date while online sales have risen 4% year on year, a trend it expects to continue given Germany's e-commerce penetration lags other major markets. The bank said Next and Zalando are best placed to benefit from the online shift, while Action and H&M carry more exposure to German stores, and JD Sports plans to close about 40% of its roughly 100 German stores as parts of the market appear to favour single-brand retailers over multi-brand stores.
Clothing brands from Uniqlo to Zara expand repair services to attract Gen Z
Major clothing brands including Levi Strauss & Co., Uniqlo, Primark, and Zara are expanding in-store repair services and sewing workshops to appeal to Generation Z consumers who prioritize sustainability and saving money. Levi's has created a handstitching course for high school students and offers repair and customization services at hundreds of stores worldwide. Primark has held over 730 free 'Love It For Longer' workshops across nine countries and tested in-store repairs in the U.K. Uniqlo provides repairs, sashiko mending, and embroidery in 75 of its roughly 2,500 global stores. Skeptics like Professor Kate Fletcher argue that such initiatives do little to offset the fashion industry's overproduction, while H&M Group has called for tax policies to make repair and resale commercially viable.
Fashion brands launch own resale platforms to capture secondhand market growth
Major fashion brands including Zara, H&M, Lululemon, Levi's, and REI are launching their own resale platforms to sell secondhand versions of their products alongside new ones, seeking a share of a global secondhand apparel market projected to reach $393 billion by 2030. The U.S. resale market is expected to hit $78.8 billion by the end of the decade, growing nearly four times faster than overall retail clothing sales last year. H&M reported that resale represented 0.8% of its 2025 turnover, with revenue reaching SEK 1,844 million, a 31% increase from the previous year. Brands are motivated by both sustainability goals and competitive pressure, as resale has largely occurred on third-party platforms like eBay, Poshmark, Depop, and The RealReal. By operating their own marketplaces, companies aim to control the customer experience, strengthen loyalty, and capture revenue throughout a garment's life cycle.
H&M is closing 128 stores worldwide as part of a global reset of its physical retail footprint, tied to a broader push starting in 2025 to prioritise stronger locations and expand its omnichannel model. Capital is being redirected toward higher productivity stores and digital capabilities to better align with changing shopper behaviour. The store base is 3% smaller than a year earlier, yet earnings across both the second quarter and first half of 2026 were broadly in line with the prior year, suggesting cost measures and a tighter focus on full price sales helped offset softer revenue. The company plans roughly 90 new store openings as it balances closures with the performance of its online and new format stores.
H&M Q2 Earnings Call Highlights Margin Gains and Sales Gap
H&M used its second-quarter 2026 earnings call to emphasize improving profitability while acknowledging that sales recovery remains incomplete. The operating margin reached 12% excluding one-time costs, and the gross margin rose 120 basis points to 56.6%, but revenues of $5.90 billion and earnings per share of $0.05 missed the consensus estimate. Management attributed the muted sales to weak Western European demand, logistics disruptions, and supply gaps, with June expected to be on par with last year. The company also outlined organizational changes, including removing a regional layer and eliminating the separate online sales organization, which incurred SEK 679 million in restructuring costs. Looking ahead, H&M plans to upgrade digital infrastructure and accelerate store improvements, while maintaining its full-year guidance for low single-digit SG&A growth in local currencies.
H&M closed 136 stores and shut down its Monki brand
H&M closed 136 stores over the past six months and shut down all standalone Monki stores by the end of 2025, folding the brand into Weekday. The retailer has closed more than 600 stores since 2022, ending the first half of 2026 with 4,038 locations. Sales decreased 1% in the first six months, but profitability improved, and CEO Daniel Ervér said the company is on track with its goals. The move reflects a broader shift to simplify the business and focus resources on fewer concepts amid rising competition from digital rivals like Shein and Temu.
HMSB.XETRA · Demand · Negative H&M closed 136 stores and shut down Monki brand, with sales down 1% in first half, indicating weak demand.
Shein Group Limited · Competition · Positive H&M's struggles and store closures are attributed to competition from digital rivals like Shein, which benefits.
H&M net sales decline to Skr54.82bn in second quarter
H&M reported net sales of Skr54.82 billion for the second quarter ended 31 May 2026, down from Skr56.71 billion a year earlier. Gross profit fell to Skr31.04 billion from Skr31.42 billion, but gross margin improved to 56.6 percent from 55.4 percent. Operating profit was nearly unchanged at Skr5.913 billion, while operating margin edged up to 10.8 percent from 10.4 percent. Profit for the period was Skr3.962 billion, with earnings per share rising marginally to Skr2.49 from Skr2.48. The group ended the quarter with 4,038 stores worldwide, about 3 percent fewer than a year earlier, and plans to open its first store in Paraguay in the second half of 2026 and enter Argentina in 2027.
H&M says tighter inventory management weighed on sales
H&M reported net sales of 104.4 billion Swedish krona for the first half of its financial year, a 3% decline from the same period a year earlier, as efforts to tighten stock control left some stores unable to fully meet shopper demand. Sales in Western Europe, the company’s largest market, fell 5% year-on-year. Chief executive Daniel Erver said sales in the latest quarter were somewhat lower than planned, adding that tighter inventory management had in some cases affected the ability to meet demand. He noted that the company sees potential to further increase precision to create a better balance between availability and demand, and that improvements made in recent years have strengthened profitability and simplified operations.
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