
Morrisons achieves significant sales growth despite market challenges
Morrisons achieves significant sales growth despite market challenges
- Morrisons achieved 3.4 percent like-for-like sales growth during the six weeks to January 4, 2026.
- The company reported significant demand for its premium products and a successful clothing segment over the Christmas period.
- Despite this growth, underlying earnings remained flat, and market share showed a slight decline.
Story
In the UK, during the crucial Christmas trading period of 2025, supermarket chain Morrisons revealed a strong sales performance amidst a challenging and competitive market. The company achieved a 3.4 percent growth in its like-for-like sales for the six weeks leading up to January 4, 2026. This was notably driven by increased demand for their premium own-brand products, which soared by 17.4 percent. Additionally, non-food sales rose by 10 percent, with the clothing segment also exhibiting positive growth at 4.7 percent over the holiday season. This encouraging sales growth was an improvement compared to their overall performance for the financial year ending October 26, 2025, where like-for-like sales increased by 2.8 percent but decelerated to 2.4 percent in the final quarter of that period. Despite the positive sales growth, the company's underlying earnings remained stagnant at £835 million for the fiscal year, facing significant adversities, including rising operational costs and a cyber incident that disrupted IT systems just before Christmas 2024. This setback negatively impacted product availability during a peak shopping period, further complicating their market position. The notable rise in costs, attributed to external factors such as a recent national insurance contributions tax hike and increases in the minimum wage, accounted for an additional £200 million in expenses over the past financial year. Morrisons, owned by US-based private equity firm Clayton, Dubilier and Rice, undertook considerable measures to mitigate these challenges, successfully cutting costs by £233 million during the same financial year. Rami Baitieh, Morrisons' Chief Executive, expressed pride in the continuous growth during a demanding economic climate, noting this marked the twelfth consecutive quarter of like-for-like sales increases for the company. Baitieh emphasized the resilience demonstrated by Morrisons amidst external pressures such as cyber attacks and inflation. Although recent market data indicated a slight decline in Morrisons' market share to 8.5 percent from 8.6 percent the previous year, the company announced plans to enhance customer value through further price reductions, implementing an additional 2,500 cuts at the start of January 2026. As Morrisons prepares for the first quarter of 2026, it remains focused on maintaining its market position while navigating the competitive grocery landscape. The company is optimistic about exceeding its £1 billion savings target by the end of the 2025-26 financial year, as it continues to adapt to ongoing economic challenges and consumer needs.