Burberry has seen its share value increase by over 16% after stating it was in the "early stages" of a turnaround strategy, despite a 17% year-on-year drop in revenue.

In the year to 29 March, the luxury fashion brand saw its revenue fall to £2.46bn, while its retail operating profit dropped by 94% to £26m. However, its H2 operating profit offset a loss of £41m in the first half of the year.

Furthermore, Burberry recorded an operating loss of £3m in the period, following a profit of £418m in the 2024 financial year.

However, its free cash flow improved by 5% to £65m.

The results come after the firm launched its Burberry Forward strategy in November to "reset the brand storytelling". It stated that the plan is set to make changes to productivity, simplification and financial discipline.

The strategy is set to unlock £60m in savings by 2027, alongside its £40m cost savings programme.

Chief executive officer at Burberry, Joshua Schulman, said: "After a challenging first half, we have moved at pace to implement Burberry Forward, our strategic plan to reignite brand desire, improve our performance and drive long-term value creation.

"With improvement in brand sentiment, we will be ramping up the frequency and reach of our campaigns as our Autumn and Winter collections arrive in store. The continued resilience of our outerwear and scarf categories reaffirms my belief that we have the most opportunity where we have the most authenticity."

Looking ahead, Burberry said that the current macroeconomic environment has become "more uncertain in light of geopolitical developments".

However, it said the 2026 financial year will allow the firm to build on its early progress in "reigniting brand desire".

Therefore, it stated that it is confident in the positioning of the business for a return to profitable growth.

Head of money and markets at Hargreaves Lansdown, Susannah Streeter, described the 2025 financial year as "checkered".

She concluded: "The 94% drop in adjusted operating profits and 17% fall in revenues is not a good look, although recent quarters indicate that the brand turnaround is smartening up. The refreshed fashion strategy under CEO, Joshua Shulman, is helping to stem the decline, but patience is wearing thin. The aim is to slim down and take on a leaner silhouette to cope with the uncertainty ahead.

"There is a risk of more difficult times to come given that the financial year for the fashion house ended before President Trump’s tariff announcements. Although the most onerous tariffs have been rolled back, consumer confidence in China, which has been the powerhouse for luxury brands, will take time to be restored, which could also slow down Burberry’s progress."

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