M & S Profits More Than Halve After Cyber-Attack

Published: 05 November 2025. The English Chronicle Desk. The English Chronicle Online.

Marks & Spencer has reported that its profits more than halved after a major cyber-attack disrupted its operations, hitting its clothing and homeware business hard. The retailer said underlying profits fell to £184.1 million in the six months to 27 September, down from £413.1 million the previous year, as it struggled to restore its online systems.

The cyber-attack, which struck over the Easter weekend, forced M&S to halt online orders of clothing, homeware, and gifts for more than six weeks. This left many customers unable to purchase items online and disrupted deliveries to stores and online food partner Ocado.

Clothing and homeware sales slumped by 16.4% during the period, as the division proved slower to recover than the retailer’s food arm. The company said store sales were affected by reduced availability and fewer visits due to the absence of click-and-collect services. Warehouse systems have now been restored, and M&S said that trading is improving as website and in-store availability return to normal.

Food sales performed better, rising by 7.8% in the half-year. The retailer said its food business has largely recovered from the effects of the cyber-attack, helping to offset losses elsewhere. Group sales rose 22% to £7.96 billion, reflecting the resilience of M&S’s food business.

“We are confident we will be recovered and back on track by the financial year end in March,” the company said in a statement. The business also benefited from a £100 million insurance payout for the cyber-attack, although this was partially offset by £50 million in additional costs, including a new packaging recycling levy and insurance premiums.

To strengthen its financial position, M&S is targeting £600 million in cost savings this year, up £100 million from its previous plan. Despite cost-cutting measures, the retailer opened six new stores in the six months to the end of September and plans to open a further 12 by March.

Chief Executive Stuart Machin said: “In the second half, we expect profit to be at least in line with last year. This should give us a springboard into the new financial year and set M&S up for further growth.”

Machin acknowledged the pressures facing the retail sector, including rising costs from new taxes, but said the company has control over key factors. “The retail sector is facing significant headwinds – in the first half, cost increases from new taxes were over £50 million – but there is much within our control. Accelerating our cost reduction programme will help to mitigate this.”

He added: “Our plan to reshape M&S for long-term sustainable growth is unchanged. Our ambitions are undimmed, and our determination to knuckle down and deliver is stronger than ever.”

M&S’s challenges contrast with rival Next, which last week reported sales and profit growth “materially above” expectations, raising hopes that UK consumers are still willing to spend despite household budget pressures.

The Easter cyber-attack on M&S’s IT systems affected multiple areas of the business. Fashion, homeware, and gifts could not be sold online for over six weeks. Deliveries to stores and online orders were delayed, and some food deliveries through Ocado were also disrupted.

The retailer had previously estimated that the cyber-attack would cost it £300 million in profits this year. Through a combination of insurance recoveries, cost reductions, and other measures, M&S now expects to cut the financial impact to about £150 million.

The cyber-attack underscored the vulnerability of major retailers to digital threats, highlighting the need for robust IT systems and contingency planning. M&S has now restored its online and warehouse systems and says trading is recovering steadily.

Machin said that while the first half of the financial year was challenging, the company is focused on long-term growth. He described M&S’s cost-cutting programme as a critical part of maintaining financial stability while continuing to invest in stores, e-commerce, and customer services.

Analysts say the cyber-attack, combined with structural challenges in the clothing and homeware sector, contributed to the steep decline in profits. Competition from online retailers and changing consumer habits have put additional pressure on traditional high-street chains.

Despite the setbacks, M&S has continued to expand its store network. The six new stores opened during the first half of the year signal the retailer’s commitment to maintaining a strong physical presence, even as it rebuilds its online capabilities. Plans to open a further 12 stores by March demonstrate confidence in the resilience of the business.

The company is also taking steps to adapt to changing consumer expectations. Restoration of its click-and-collect services and improved online availability for clothing and homeware are expected to support recovery. M&S said it aims to return to pre-attack trading levels as quickly as possible.

The retailer’s food business has proven a strong buffer against losses elsewhere, with sales growth exceeding expectations. This highlights the importance of diversification for M&S, as food retailing has remained robust despite economic pressures on clothing and homeware.

Machin emphasised that the business remains on track to deliver long-term sustainable growth. He said: “We are focused on delivering for our customers, adapting to their needs, and ensuring M&S remains a retailer of choice for food, fashion, and homeware alike.”

The Easter cyber-attack has served as a warning to other retailers about the importance of cybersecurity and business continuity planning. M&S said it has strengthened its systems to prevent future disruptions and ensure that customers can continue to shop online safely and efficiently.

Investors are closely monitoring M&S’s recovery, particularly the company’s ability to meet its profit targets for the second half of the year. Analysts say the combination of cost-cutting measures, restored online services, and strong food sales should provide a foundation for improved performance.

Machin remains optimistic about the future. “We are confident that our actions will enable us to overcome these challenges. The recovery of our clothing and homeware business, combined with ongoing investment and cost discipline, positions M&S for continued growth and stability in the years ahead.”

As the company navigates post-cyber-attack recovery, M&S is focused on protecting its brand, serving customers, and ensuring long-term profitability. The retailer’s experience underlines the growing importance of cybersecurity, operational resilience, and adapting to the changing retail landscape in the UK.