LONDON, January 6, 2026 – British fashion retailer Next (NXT.L) has lifted its annual profit forecast for the fifth time this year, after reporting a 10.6% increase in full-price Christmas sales, surpassing analysts’ expectations. The strong trading update sent Next shares up 3.1% in early trading.

Despite subdued consumer confidence and unusually mild weather in the UK ahead of Christmas, Next reported a 5.9% rise in UK sales over the nine weeks to December 27. Higher stock availability compared with last year, when supply chain disruptions in Bangladesh and global freight delays constrained inventory, helped drive the growth.

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International Sales Surge

Next’s international sales jumped 38.3%, boosted by increased marketing investment and improved stock availability. The retailer has an online presence in over 70 countries, giving it a global footprint beyond its 800+ stores in the UK and Ireland, including Reiss, Joules, and FatFace outlets.

The strong performance extended Next’s share gains to 47% over the last year, while rival Marks & Spencer (MKS.L) shares fell 1.4% ahead of its upcoming trading update.

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Upgraded Profit Guidance

Next now expects pre-tax profit of £1.15 billion ($1.56 billion) for the year ending January 31, 2026. This is up from the previous guidance of £1.135 billion and significantly higher than the £1.011 billion reported in 2024/25, when the company exceeded the £1 billion mark for the first time.

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Caution on 2026/27 Growth

The retailer warned that full-price sales and profit growth are expected to slow to 4.5% in 2026/27. Pressures on the UK economy, including high unemployment, which recently hit its highest level since early 2021, and challenging comparative sales numbers, are likely to affect growth.

“While we expect Next to continue to outperform most peers, this tough backdrop may make future upgrades harder to achieve,” said Shore Capital analyst David Hughes. The company also anticipates moderating growth from overseas online sales after the exceptional results of 2025/26.

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Conclusion

Next’s strong Christmas performance highlights the resilience of UK fashion retail, supported by effective stock management and international expansion. However, economic pressures and tough comparisons are expected to slow growth in the coming year, signaling a more cautious outlook for investors.