Dunelm enjoyed sales growth of 1.6% in its Q2 (the 13-week period ended 27th December 2025) to £498m, with digital participation up. This performance meant that total sales in H1 were up 3.6% to £926m, with PBT expected to be approximately £112m-£114m – yet the retailer now expects FY26 PBT to be at the lower end of expectations (£214m-£227m).
"Following a strong Q1, trading was more challenging in the second quarter, particularly around Black Friday and continuing into December, highlighting the ongoing challenging macroeconomic environment," Dunelm explains.
"As in recent years, we also continued to be disciplined in our promotions during this period, but this year we saw an especially high level of competitive activity in both digital marketing and discounting. As a result, Q2 sales were softer than anticipated at +1.6% YoY.
"Our growth in the second quarter continued to be driven by our core categories, notably bedding, towels and lighting, and Made-to-Measure again grew strongly. However, we saw softer trading in furniture, driven in part by availability challenges, against which recovery plans are in place. Since the end of the quarter we have seen customers respond well to our offers in the winter sale, with overall growth higher than we saw in Q2.
"Gross margin remained strong, increasing by 60bps YoY in the first half, which continued to be primarily driven by FX tailwinds.
"Overall we are reporting a solid performance for the first half, with strong sales in Q1 followed by a softer Q2, reflecting consumer behaviour. At the same time, we have continued to improve our customer proposition, including opening our second inner London store in Wandsworth in Q2 and reopening our Yeovil store following a fire last year, with plans to open up to two further superstores in the second half. Our new Dunelm App is also now live on both Apple and Android platforms, with a full customer launch planned for February.
"We previously guided that profits would be more heavily weighted towards the second half than the prior year – H1 PBT has also been impacted by the second quarter trading performance. As such, we now expect PBT for the first half to be approximately £112m-£114m. We expect PBT for the full year to be at the lower end of consensus expectations."
CEO Clo Moriarty comments: “We delivered a solid first half, and I’m really proud of all our colleagues for their efforts over this busy period. The performance reflected a strong first quarter followed by a more challenging close to the half.
“Whilst the UK retail environment remains variable, we have acted on some clear lessons from the first half, including targeted steps to improve availability, ensuring customers can access our fantastic ranges seamlessly, however they are shopping with us.
“I see multiple opportunities to extend Dunelm’s market-leading position – there is much more in the tank. As such, we are now moving forwards with energy and discipline, actively building new plans whilst executing existing ones to ensure we are the first choice for all home lovers.”
