More concern for UK retail with listed FTSE retailers issuing seven profit warnings during Q2 2025, more than double the amount recorded in the previous quarter, according to EY Parthenon’s latest Profit Warnings report.
Reuters
FTSE retail companies issued four profit warnings during the period, but combined with the FTSE Personal Care, Drug and Grocery sector, which includes supermarkets, there were seven warnings from listed retailers.
Despite this increase, in the first half of 2025, FTSE Retailers issued a total of six profit warnings, a significant fall from the 12 warnings issued during the same period last year.
Silvia Rindone, EY Partner and UK&I Retail Lead, said: “This [Q2] spike highlights both softening consumer demand and the deeper structural headwinds facing the sector. Retailers we speak to tell us that falling sales are currently indicative of a longer-term shift, with consumers becoming more value-focused and less brand-loyal, which leaves cost-pressured retailers in a bind.”
She added: “Despite ongoing pressures, including the rise in National Insurance Contributions and the National Living Wage, alongside tariffs, investment in technology including AI remains essential. The winners will be those who get the basics right, such as range, service, and pricing, whilst continuing to build for the future with leaner models, sharper propositions and digital resilience.”
In Q2, the number of profit warnings issued by UK-listed companies overall rose by 20% to 59 compared to 49 in the same period last year. Over the last 12 months, nearly a fifth (19%) of UK-listed businesses have issued at least one profit warning.
The leading factor behind profit warnings during the second quarter was policy change and geopolitical uncertainty, cited in nearly half (46%) of warnings. This marked a significant increase from just 4% in Q2 2024, and the highest percentage recorded for this cause in more than 25 years of EY’s analysis.
