NEXT Q3 trading statement preview: can strong international sales offset a cautious UK consumer?

NEXT Q3 trading statement preview: can strong international sales offset a cautious UK consumer?

NEXT publishes its third-quarter trading statement on Thursday 5 November, covering the 13 weeks to 31 October 2026. Investors will be looking for evidence that the retailer’s international expansion can continue to compensate for more challenging conditions in the UK, where consumers remain under pressure from higher living costs, borrowing costs and an uncertain economic outlook.

The update comes after NEXT raised its full-year profit guidance at its September half-year results, despite lowering its expectations for UK sales growth in the second half. The retailer’s ability to deliver against that revised outlook will be the main focus, alongside any indication that trading has improved as colder weather encouraged shoppers to buy autumn and winter clothing.

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

Full-year profit guidance in focus

At its half-year results on 17 September, NEXT increased its forecast for 2026/27 full-year profit before tax to £1.255 billion, up 8.4% on the previous year’s £1.158 billion. This was £12 million higher than its previous estimate, reflecting better-than-expected sales and cost savings.

The upgrade came despite a more cautious outlook for the UK. NEXT reduced its forecast for second-half UK full-price sales growth to 2%, from 2.8% previously, reflecting weaker trading conditions and concerns about the health of the domestic consumer.

However, the company maintained its expectation for second-half group full-price sales growth of 5.8%, with international sales expected to provide much of the momentum. The Q3 statement will therefore reveal whether overseas demand is strong enough to offset the more subdued performance at home.

A further increase in profit guidance is possible if sales and margins continue to outperform, but management may prefer to wait until after the crucial Christmas trading period before making another change. Equally, any deterioration in UK demand or a weaker international performance could put the current target under pressure.

UK trading: has the consumer turned a corner?

UK full-price sales rose 7.7% in the first half, but growth slowed from 6.2% in the first quarter to 9.2% in the second quarter for the group as a whole. Within the UK, sales growth eased from 4.4% to 2.8%.

The second-quarter performance was affected by unusually warm weather, which NEXT said had supported demand, as well as a release of pent-up demand in some overseas markets. The retailer also benefited from being able to spend more on profitable marketing than it had initially anticipated.

The UK outlook subsequently became more cautious. NEXT warned that inflation, higher mortgage costs and a weak jobs market could weigh on household spending, particularly if tax increases in the government’s autumn Budget further undermine consumer confidence.

The trading statement should provide a clearer picture of whether the domestic market has stabilised. Investors will be watching for a breakdown between online sales and stores, as the two channels have been performing differently. In the first half, UK online sales were more resilient than store sales, with the latter particularly exposed to subdued high-street footfall.

Weather will also be an important factor. A colder October could have encouraged purchases of coats, knitwear and other seasonal clothing after a relatively mild start to autumn. However, any improvement needs to be assessed against the wider consumer backdrop and the extent to which shoppers are willing to spend at full price rather than wait for promotions.

International expansion remains the growth engine

International sales have been a major source of strength for NEXT. In the first half, international full-price sales increased 23.9%, including growth of 36.9% in the second quarter. This helped lift total group full-price sales growth to 7.7% for the six months.

The company expects international growth to moderate in the second half, forecasting an increase of 20.5% at its September results. This partly reflects tougher comparisons following last year’s improvements to European stock availability and distribution, as well as the exceptionally strong second-quarter performance.

Investors will want to see whether NEXT can sustain robust overseas demand without having to increase marketing expenditure disproportionately. The retailer has expanded its international reach through its own websites and third-party platforms, while improving stock availability and distribution. These initiatives have helped it reach more customers without relying solely on the expansion of its physical store estate.

The Middle East is another area to monitor. Trading in the region has been affected by geopolitical tensions, while currency movements and shipping or distribution disruption could also influence overseas sales and profitability.

Margins, costs and shareholder returns

Sales growth is only part of the story. NEXT has built a reputation for disciplined stock management, full-price selling and tight cost control, all of which have helped it maintain relatively strong profitability in a competitive retail market.

The company’s ability to protect gross margins will be important as it heads into the Christmas period. A weaker consumer environment could prompt more discounting across the sector, while higher wage, freight and operating costs could put pressure on margins. NEXT will need to balance maintaining its pricing discipline with remaining competitive against other clothing retailers.

The retailer has also continued to return surplus cash to shareholders through buybacks. Its latest guidance assumed £524 million of share repurchases during the financial year, with £355 million already spent by the time of its August trading statement. The remaining £169 million was expected to be returned through further buybacks, subject to the company achieving its required rate of return, or through a special dividend or other capital return.

Any update on the pace of buybacks and cash generation will therefore be relevant, although trading and full-year profit guidance are likely to dominate the market reaction.

For income-focused investors, the combination of buybacks and the possibility of a special dividend makes NEXT an increasingly interesting case. You can find out more about the advantages of buying shares and how to build a capital-returns-focused portfolio through our educational resources.

Analyst ratings and technical analysis

Even though most analysts rate NEXT as a ‘buy’, several have a ‘hold’ rating for the share with a mean long-term share price target at 16,439.74 pence, around 8% above current levels (as of 4 November 2026).

According to TipRanks NEXT has a Smart Score of ‘8 Outperform’ and a ‘buy’ rating.

The NEXT share price – up 13% year-to-date – remains in a medium-term uptrend and will continue to do so as long as it continues to trade above its 200-day simple moving average (SMA) and its September low at 14,000-to-13,996p.

NEXT daily candlestick chart

A rise and daily chart close above the early November peak at 15,500p may put the July peak at 16,175p back on the map. On the way up the early-to-late August highs at 15,760p-to-15,900p may act as interim resistance, though.

Only a currently unexpected bearish reversal and fall through the 14,000p early September low would void the bullish medium-term outlook and may lead to the late February-to-April highs at 13,615pto-13,520p being revisited.

How to invest in NEXT shares

1. Do your research on NEXT, the Q3 trading statement on 5 November and the key metrics to watch across UK and international sales
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