H&M reported a 40% rise in third-quarter operating profit, supported by cost savings, stronger margins and successful collections.
The Swedish fashion giant, the world’s second-largest clothing retailer, posted operating profit of 4.91 billion crowns ($453 million) for the three months to end-August, up from 3.51 billion a year earlier. Net sales grew 2% in local currencies to 57 billion crowns.
Shares in H&M rose as much as 10% after the earnings release, reaching their highest level in nearly a year. The company said inventory levels were down 9% compared with last year, reducing markdowns and improving profitability.
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H&M has been closing underperforming stores and streamlining operations as part of its turnaround strategy. The group credited disciplined cost management and an improved product mix for its stronger results.
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However, H&M warned that new U.S. import tariffs could weigh on margins in the fourth quarter. Sales in September were flat from a year earlier due to a strong comparable period in 2024.
