Burberry revenues reached £2.42 billion for the 2026 fiscal year, ended March 28. Despite flat year-on-year growth, profitability improved, and the company expects to deliver both revenue growth and margin expansion in 2027.

Adjusted operating profit improved significantly from £26 million in 2025 to £160 million. Gross profit rose 9% and gross margin lifted 5.3%, driven by higher quality sales off the back of last year’s inventory reset. Adjusted operating margin improved from 1% last year to 6.6% in 2026, while reported operating profit swung from a £3 million loss to a £115 million profit.

“This is evidence that our Burberry Forward strategy is working,” Burberry CEO Joshua Schulman said on Thursday’s earnings call. Schulman launched the strategy a year and a half ago, shortly after joining the brand. The aim is to reignite brand desire and improve performance by reconnecting Burberry with its original purpose and audience. Cost savings are also part of the plan, with the company anticipating an additional £20 million in 2027, on top of the £80 million delivered this year.

Comparable store sales were up 2% in 2026, after a return to growth from Q2, and particular improvement across Greater China and the Americas, which were both up 10% in Q4. In EMEIA (Europe, the Middle East, India, and Africa), comparable store sales were flat for the year, with a 2% decline in Q4 due to the Middle East conflict.

“We have not seen the impact of the war in the Middle East beyond the Middle East [region] itself, and some impact on travel in EMEIA. It’s been quite localized,” said Schulman, adding that the Middle East accounts for 2% of Burberry’s total sales. CFO Kate Ferry highlighted strong momentum among American tourists visiting Europe, however.

Sales in the Americas and Greater China were up 4% for both regions. In China, the brand’s largest market, which represents over 30% of sales, growth was driven by local spend. Burberry is expanding its marketing efforts in the region through a series of documentary films produced in partnership with magazine Chinese National Geography; they will feature local talent, wearing seasonal outerwear styles, exploring the country’s natural landscape and historic sites. Burberry also plans to host a “large-scale brand experience” in Shanghai later this year to close its 170th-anniversary celebrations. In Asia-Pacific — Japan, South Korea, Southeast Asia, Australia, New Zealand — sales were up 2%.

Sales from Burberry’s core categories — outerwear and scarves — were each up double digits in the second half of the year. The brand rolled out 200 scarf bars across its stores in 2026, a merchandising strategy to reignite excitement around the category.

Licensing sales — accounting for fragrance, beauty, and eyewear — declined 9%, in line with company expectations. It destocked old fragrance lines as part of its Burberry Forward strategy. “Our license categories have longer lead times, and we are excited that in 2027 we are finally starting to align our licensees with the [new] brand expression,” said Schulman. In beauty, Burberry has updated its marketing with a campaign featuring musician Olivia Dean in a Burberry trench coat against a London landscape. In eyewear, Schulman said Burberry has moved from a “niche aesthetic without a clear connection to our brand codes” to a “more recognizable and desirable expression” aligned with its fashion branding.

Ahead of the earnings announcement, chair Gerry Murphy announced his retirement after eight years in the role, effective November 2026. He will be succeeded by William Jackson, founder of private investment firm Bridgepoint Group, who will join initially as a non-executive director in July.

Despite being cautious about the macro environment, Schulman was positive about Burberry’s growth potential. “Over the past year, we have made significant progress, guided by our Burberry Forward strategy. We are seeing the impact on our business and our financial performance,” the CEO told investors. “Going forward, we are now focused on delivering sustainable profitable growth, operating with greater discipline across the organization, driven by a mindset of saving to reinvest and fuel growth. We’re just getting started.”