H & M Hennes & Mauritz Ab (publ) Stock Earnings Reports

H&M Group reported continued progress in Q3 2025 with sales up 2% in local currencies despite a 4% reduction in store count. The online store upgrade contributed to profitable growth; inventories improved, down 9% in SEK vs. prior year, supported by better demand planning and a well-executed summer sale. Operating profit for the quarter was SEK 4.9 billion, with an operating margin of 8.6% (up from 5.9% year‑over‑year), driven mainly by supply‑chain improvements, better gross margin and disciplined cost control (OpEx down ~1% in local currency). Management highlighted strong brand and market moments (entry to Brazil, new Paris flagship, COS at NYFW, H&M at London Fashion Week) and a leading sustainability disclosure ranking. Outlook/risks: September sales expected to be on par with last year; Q4 external tailwinds (currency, freight, raw materials) are expected to be smaller than in Q3 and partially offset by U.S. tariffs that will weigh on gross margin into Q4 (with some effects reversing into Q1). Management continues to invest in brand, store upgrades and digital experience (which is contributing to profitability through higher conversion and lower returns), is accelerating supply‑chain responsiveness (nearshoring, strategic supplier partnerships, more in‑season buying and RFID/demand‑planning initiatives), and will continue portfolio optimization (closing low‑productivity stores while opening selective high‑quality locations).