Burberry Sees Sales Rise in China as Brand Recovery Gains Momentum

Burberry has reported its first quarterly sales growth in two years, bolstered by a significant recovery in the Chinese market and renewed interest from younger consumers seeking authentic British luxury brands. The FTSE 100 label, regarded as the epitome of classic British fashion, announced a two per cent increase in comparable store sales for the three months ending 27 September, exceeding analysts’ expectations and rebounding from a one per cent decline in the previous quarter.

Growth in Greater China returned for the first time after several years of contraction driven by economic challenges. Sales in the region advanced by three per cent compared to a five per cent fall in the prior quarter. Chief executive Joshua Schulman, who took the helm in July last year, attributed much of the current progress to younger clientele revisiting Burberry stores. He credited targeted collections and strengthened engagement with both new and returning customers for a meaningful boost in sell-through rates, particularly for the recent autumn and winter ranges.

Schulman’s turnaround strategy, termed Burberry Forward, targets the label’s core outerwear and accessories, including trench coats and scarves. Recent successes were noted in the sales of the Floriston quilt jacket, tribal-print scarves, and other British staples; early recovery was also observed in handbags and footwear. The company’s steps to reassert its British heritage and cut costs, including plans to remove up to 1,700 roles globally by 2027, have reversed losses and helped restore investor confidence.

Still, the macroeconomic climate remains uncertain. Group revenue over the past six months fell three per cent at constant exchange rates to slightly more than £1 billion, and operating losses narrowed to £18 million from £53 million. Pre-tax losses dropped to £48 million from £80 million. Despite these figures, Burberry’s share price has climbed about 80 per cent in the past year, marking a significant recovery.

Schulman stressed the resilience of Burberry’s new strategy, with customer growth showing ongoing improvement. While Americas sales rose three per cent this quarter, compared with a four per cent rise previously, modest price adjustments introduced to offset higher costs had no discernible impact on demand. Analysts from Deutsche Bank and RBC have highlighted the credibility of Schulman’s leadership and the renewed focus on British heritage and product leadership as sources of strength for the brand’s ongoing transformation.

Schulman has also called for the UK government to reintroduce tax-free shopping in Britain, a measure he argues would restore London’s standing as a premier luxury destination and drive growth in tourism spending. The removal of the VAT refund was labelled a costly error by luxury leaders, who cite the knock-on effects to hospitality, culture, and transportation, as well as retail. Although the current and previous governments have been hesitant to reinstate this scheme, the sector continues to lobby for its return, underscoring its potential to boost overall visitor expenditure and support jobs across the industry.