NEXT half-year results preview: can another upgrade be on the cards?

NEXT half-year results preview: can another upgrade be on the cards?

NEXT heads into its half-year results on 17 September with the retailer having already raised its full-year profit expectations, leaving investors to assess whether the latest trading momentum can be sustained through the crucial second half.

Year-to-date the NEXT share price has risen by around 10% but over the past five years it gained 99% on a total annualised return basis and 129% on a total return (by re-investing dividends) basis.

NEXT 5-year total return graph

The fashion and homeware retailer has consistently outperformed its own forecasts in recent years, and its latest trading statement provided another indication that demand remains resilient despite a challenging consumer backdrop.

The key question for the 17 September results will therefore be less about whether NEXT is growing and more about how much further ahead of expectations it might be.

Those looking to invest in NEXT ahead of or after the results can do so through IG Invest or our share dealing service, while traders can access the share price via spread betting or CFD trading.

Strong start to the financial year

NEXT began 2026/27 expecting full-price sales to rise 4.5%, with group profit before tax forecast at £1.2 billion.

That outlook was subsequently upgraded after a particularly strong second quarter.

In its August trading statement, NEXT reported that full-price sales increased 9.2% in the second quarter, more than five percentage points ahead of its 4% forecast. Sales were £70 million ahead of expectations, with £19 million of the outperformance coming from the UK and £51 million from overseas.

The strength of trading prompted NEXT to raise its full-year pre-tax profit forecast by £25 million to £1.243 billion, implying growth of 7.3%.

Full-price sales guidance was also increased to £6.0 billion, up 6.3%, while total group sales are expected to reach £7.5 billion, an increase of 6.6%.

The half-year results should therefore provide investors with a much clearer picture of how much of that upgrade has already been delivered and whether management sees scope for further improvements.

International growth is the standout

One of the biggest themes investors will be watching is NEXT's rapidly expanding international business.

International online full-price sales jumped 36.9% in the second quarter, compared with growth of 2.8% in the UK. For the first half, international sales were up 23.9%, versus 3.6% domestically.

The international operation has increasingly become an important source of incremental growth for NEXT, with the company benefiting from expanding its online proposition and improving distribution through its ZEOS platform.

However, management expects international growth to moderate during the second half as NEXT begins to face tougher comparisons.

The half-year results should therefore offer an important test of whether the recent international acceleration represents a sustainable structural growth opportunity or whether some of the recent strength has been driven by particularly favourable comparisons.

UK sales remain resilient

The performance of NEXT's core UK business will be equally important.

UK full-price sales increased 3.6% in the first half, with online sales significantly outperforming stores. UK online full-price sales rose 7.4%, while retail-store sales declined 1.7%.

NEXT is forecasting UK full-price sales growth of 2.8% in the second half, implying full-year UK growth of around 3.2%.

That is hardly spectacular, but it would represent a solid performance in a mature and highly competitive market.

The results should reveal whether NEXT is continuing to gain market share while maintaining its pricing discipline. Investors will be particularly interested in the balance between volumes, average selling prices and promotional activity.

A key strength of NEXT's model has been its ability to grow sales without relying excessively on discounting. Maintaining that discipline will be crucial as the company moves into the second half and the important Christmas trading period.

Can margins keep improving?

Sales growth will attract most of the headlines, but profitability could prove more important for the shares.

NEXT's ability to turn relatively modest UK sales growth into stronger profit growth has been one of the defining features of its recent performance.

The company is currently forecasting full-year pre-tax profit of £1.243 billion, up 7.3%, compared with expected full-price sales growth of 6.3%.

Investors will therefore be looking for evidence that gross margins remain healthy and that cost inflation is under control.

The half-year results should also provide an indication of whether NEXT's previous expectations for operating costs, logistics and wages remain appropriate.

Any improvement in margins could create additional room for an earnings upgrade, particularly given the company's strong cash generation.

For those interested in understanding how to assess UK retail shares and what drives profitability in the sector, our resources on investing for beginners cover the key concepts in accessible detail.

Christmas is the next big test

NEXT's second-half guidance will be closely scrutinised because the company is deliberately assuming a substantial slowdown from the exceptionally strong second quarter.

Management currently expects full-price sales growth of 5% in the second half, compared with the 9.2% achieved in the second quarter.

That looks achievable based on recent momentum, but it also suggests that NEXT is not assuming the recent acceleration will continue indefinitely.

The Christmas trading period will be particularly important.

For a retailer selling discretionary products such as clothing, footwear and homeware, Christmas can have a disproportionate impact on annual earnings. Strong full-price sales would provide evidence that consumers remain willing to spend, while increased promotional activity could put pressure on margins.

The half-year results may therefore be as much about NEXT's commentary on the second half as the numbers already delivered.

Share buybacks boost EPS growth

Capital allocation is another area worth watching.

NEXT expects to return £524 million to shareholders through share buybacks during 2026/27.

The company had already repurchased £355 million of shares by early August at an average price of £127.69, reducing the number of shares in issue by 2.3%.

This means earnings-per-share growth is expected to outpace underlying profit growth.

Current guidance points to pre-tax profit rising 7.3%, while post-tax EPS is expected to increase by 9.2% to 812.9p.

Further buybacks could therefore provide an additional boost to EPS if trading remains strong.

The company has also said that if it cannot deploy the remaining buyback allocation at an attractive valuation, it can return surplus capital through a special dividend or another capital return.

That combination of earnings growth and aggressive capital allocation remains an important part of the NEXT investment case.

ZEOS and third-party brands

Investors will also be looking beyond the traditional NEXT retail operation.

The group's Total Platform and ZEOS businesses are designed to provide technology, logistics and online infrastructure to other retailers and brands.

The international sales acceleration demonstrates the potential benefits of this broader ecosystem, while third-party brands continue to increase the range available to NEXT customers.

The half-year results should provide investors with more information on the contribution from these businesses and whether they are becoming increasingly meaningful sources of growth and profit.

This matters because NEXT's long-term growth story increasingly depends on more than simply selling its own clothing through UK stores.

Equal-pay litigation

Another issue investors will have in mind is the company's long-running equal-pay litigation.

NEXT recently secured a significant victory after the Employment Appeal Tribunal overturned a key part of an earlier ruling relating to basic pay between warehouse workers and shop staff.

However, elements of the dispute remain unresolved, including issues surrounding night-time and overtime premiums and paid rest breaks.

The legal situation therefore remains a potential source of uncertainty, although the latest ruling removes some of the more significant immediate concerns around the case.

NEXT analyst ratings and technical analysis

According to LSEG Data & Analytics NEXT is rated as a ‘buy’ with 3 ‘strong buy’, 8 ‘buy’ but also 10 ‘hold’ and one ‘sell’ recommendation with a mean long-term price target at 16,291.32p, around 8% higher than the current share price (as of 11 September 2026).

TipRanks also has a ‘buy’ rating and a ‘8 Outperform’ Smart Score.

The NEXT share price – up around 10% year-to-date – has been steadily advancing over the past four years and hit a record high at 16,175p in July 2026.

NEXT monthly candlestick chart

With the long-term uptrend firmly entrenched, the NEXT share price may hit a new all-time high later this year, provided it remains above its 1 September low and the 200-day simple moving average (SMA) at 14,000p-to-13,799p on a daily chart closing basis. For another up leg to be formed, a rise and daily chart close above the late August high at 15,760 would need to be seen.

NEXT daily candlestick chart

If so, the 17,000p region may be reached.

Immediate support sits between the June high at 14,880p and the mid-August low at 14,840p. This has so far largely held.

More significant support may be spotted between the October 2025-to-January 2026 highs at 14,635p-to-14,550p.

What to watch on 17 September

The half-year results will give investors a number of important indicators:

• First-half full-price sales growth, particularly in the UK and international markets
• Gross margins, to assess whether strong sales are translating into sustainable profit growth
• International sales, where growth has recently been substantially stronger than in the UK
• UK online sales, which have been outperforming physical stores
• Full-year profit guidance, currently £1.243 billion
• Second-half sales guidance, currently 5% full-price growth
• Capital returns, including the remaining share-buyback programme
• ZEOS and Total Platform, as investors assess NEXT's longer-term growth beyond its traditional retail operation

Perhaps most importantly, investors will want to know whether management still sees the current £1.243 billion profit forecast as appropriately cautious.

Outlook

NEXT's 17 September half-year results come at an interesting point in the company's recovery.

The retailer has already demonstrated that it can deliver strong growth in a difficult consumer environment, while international expansion is increasingly providing a second engine of growth alongside its established UK operation.

The latest trading statement was particularly encouraging, with second-quarter full-price sales 9.2% higher and £70 million ahead of expectations. That performance prompted the company to raise its full-year profit forecast to £1.243 billion.

The risk for investors is therefore not necessarily that NEXT disappoints on the numbers. Instead, it is that expectations have risen sufficiently that merely meeting guidance may no longer be enough to drive the shares higher.

A strong first-half result accompanied by evidence that international growth remains robust, UK sales are holding up and margins are healthy could reopen the possibility of another profit upgrade.

Conversely, signs that the second-quarter acceleration was temporary, particularly if international growth begins to slow sharply, could reinforce the company's more cautious second-half guidance.

For NEXT, the 17 September results will be less about proving that the turnaround is working and more about showing just how much further the earnings story can run.

How to invest in NEXT shares

1. Do your research on NEXT, the half-year results on 17 September and the key metrics to watch
2. Download IG Invest or open a share dealing account with us
3. Search for NEXT (NXT) in our platform or app
4. Choose the number of shares or value of money you'd like to invest
5. Place your trade