Next continues to profit after M&S cyber-attack

Fashion brand Next has continued to see sales overperform, following a boost in the aftermath of a cyber-attack at rival firm M&S.

The British retailer reported a stronger-than-expected 10.5% increase in full-price sales for its third quarter on Wednesday and raised its full year profit guidance for the fourth time in eight months.

Next is now expecting to report a pre-tax profit of just over £1.1bn at the end of January 2026.

It reported that UK sales had weakened in comparison to the “exceptional performance” seen earlier in the year after the M&S cyber-attack in April, but had been better than anticipated.

“As a reminder, our UK sales performance in the first half benefitted from favourable weather conditions and competitor disruption” the retailer noted in its results.

“Nonetheless, UK growth of +5.4% was stronger than we had expected.”

Kate Hardcastle, a consumer expert at Insight with Passion, told BBC Breakfast: “Some of the success this year has certainly come from Marks and Spencer’s very challenged times with its cyber-attack. They were on a huge fight back in terms of their apparel department.”

She added that Next had “picked up the benefit” of consumers moving away from Marks and Spencer’s.

In April, M&S was hit with a cyber-attack and struggled to get services back to normal, with online orders and click and collect suspended, and limited stock in some stores.

It wasn’t until June that its fashion products became available for home delivery again.

M&S admitted that some personal customer data was taken during the attack.

Next was not the only retailer to benefit from the impact of the M&S cyber-attack with Sainsbury’s reporting a boost in sales due to the cyber disruption.

Next, which owns brands including Reiss and FatFace, has over 800 shops in the UK and Ireland and a presence online in over 70 countries.

However, the UK accounts for 80% of the retailer’s sales.

Ms Hardcastle said Next has long been a leading indicator of trends when it comes to the retail industry.

“We’re getting a sense that this is a brand that is hitting all the marks when it comes to the customer… it doesn’t mean we’ll see that play out for every retailer.”

Ms Hardcastle said that at a time when other retailers are reducing staffing numbers, Next is succeeding due to things like cost engineering, and striking the right balance between its digital and physical stores.

AJ Bell investment director Russ Mould said the work the company was doing with partners and its international expansion had contributed to its “impressive growth”.

“The core brand is also demonstrating resilience in what remains a tricky consumer backdrop, with competitors struggling to match Next’s mastery of the basics of retail,” he said.