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Next has raised its full-year profit guidance for a second time after Christmas trading exceeded expectations, with full price sales rising 10.6% in the nine weeks to 27 December.
The group’s performance was ahead of its previous forecast of 7% growth for the period, adding £51m to expected full price sales.
As a result, Next has increased its guidance for profit before tax for the year ending January 2026 by £15m to £1.15bn.
Profit before tax is now expected to be up 13.7% year on year, with post-tax earnings per share forecast to rise 16.1%.
UK full price sales grew 5.9% over the nine-week period, outperforming earlier expectations, while international online sales increased 38.3%.
Next said UK trading benefited from higher stock availability than last year, when deliveries were disrupted by supply chain issues, while international growth was supported by increased marketing spend and improved stock availability across European online platforms.
For the full 52-week financial year, Next now expects full price sales of £5.6bn, up 10.7% year on year, and total group sales of £6.97bn, up 10.3%.
End-of-season sale stock levels were higher than anticipated, but stronger clearance rates offset the impact, leaving profits unchanged.
However, looking ahead to the 2026/27 financial year, Next said it expects growth to moderate, with full price sales forecast to rise 4.5% and profit before tax expected to increase to £1.2bn.
The company said growth in the current year had been supported by a number of favourable factors that would be difficult to repeat.
These included strong summer weather, disruption among competitors and improved stock availability in the UK, all of which are expected to create tougher comparatives, particularly in the first half of the new financial year.
Next also warned that continued pressure on UK employment is likely to feed through into the consumer economy as the year progresses, potentially weighing on discretionary spending.
International growth is also expected to slow from what the retailer described as exceptional levels.
