JD Sports Fashion (LSE:JD.) reduced its profit outlook on Thursday after reporting softer sales across most major markets during its third quarter, a shift the retailer attributes to deteriorating consumer conditions.
The company now expects profit before tax and adjusting items to land at the lower end of current market expectations for FY26. As of November 14, JD’s compiled analyst consensus sits at £871 million, within a range of £853 million to £888 million.
In its statement, the company warned: “Recent indicators have shown incrementally weaker macroeconomic and consumer external data points in our key markets. We are particularly mindful of the pressures on our core customer demographic, including rising unemployment levels, as well as near-term volatility around consumer sentiment.” JD added that these trends prompted management to adopt a “pragmatic approach to the FY26 outlook” as it heads into its peak trading season.
For the 13 weeks to November 1, group like-for-like sales declined 1.7%, although organic sales rose 2.4%. Total sales, including contributions from acquisitions, grew 8.1% at constant currency to £2.95 billion.
North America—JD’s largest region at 37% of quarterly sales—reported like-for-like sales down 1.7%, while organic sales advanced 3% to £1.08 billion. Excluding Finish Line stores, like-for-like sales in the region slipped just 0.2%. Footwear remained soft due to key product cycles maturing, although running products performed well.
Europe generated £1.03 billion in quarterly sales, representing 35% of the total. Like-for-like sales fell 1.1% but organic sales increased 4%. Sporting goods and apparel posted solid performance, but footwear again faced pressure from end-of-cycle product ranges.
The UK proved the toughest market, with like-for-like sales down 3.3% and organic sales falling 2% to £718 million. JD attributed the decline to unseasonably warm September weather affecting apparel, and persistent weakness in footwear—particularly women’s and athletic styles—due to product cycles nearing their end.
Asia Pacific was the only region to deliver positive like-for-like performance, with sales up 3.9% and organic sales jumping 13.3% to £124 million.
Group gross margin excluding acquisitions declined 30 basis points year over year, which JD linked to targeted price investments in online channels. Including the Courir acquisition completed on November 27, 2024, gross margin contracted by 40 basis points.
During the quarter, JD opened a new distribution centre in Heerlen, Netherlands, and confirmed it remains on track to complete £200 million in share buybacks while continuing to generate strong free cash flow.
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