H&M is expanding its store network and more than doubling capital investments in Greece to compete with Zara, despite local net profit falling 52 percent.
The Swedish fast fashion retailer recorded 2.2 million euros in net profit for the fiscal year ending November 30, 2025, down from 4.58 million euros the previous year, while total turnover remained virtually flat at 184.47 million euros.
To strengthen its market presence beyond its flagship brand, the company has introduced two additional group brands, COS and ARKET, to the Greek retail market.
Retail expansion and brand portfolio
The expansion strategy focuses on diversifying H&M Group's portfolio in Greece across different market segments. COS targets a premium, minimalistic aesthetic with emphasis on timeless design, while ARKET, established in Stockholm in 2017, operates as a broader Scandinavian lifestyle brand offering clothing for women, men, and children alongside home goods.
The group completed major store openings in March 2026. In Athens, both COS and ARKET opened locations in the Kapnikarea district, while COS established a new presence on Aristotelous Street in Thessaloniki.
Together with its namesake chain, H&M now operates three of its primary global brands in Greece. The wider international portfolio of H&M Group includes Weekday, & Other Stories, and Singular Society, while Cheap Monday and Monki have been integrated into Weekday, and the group maintains a presence in the second-hand market through Sellpy.
Capital expenditure and financial performance
According to financial disclosures for the year ending November 30, 2025, H&M Greece increased its fixed asset investments to 15.34 million euros, up from 7.64 million euros in 2024. Projects under execution accounted for 14.57 million euros of the total investment outlay.
Annual turnover reached 184.47 million euros compared to 184.59 million euros in the prior year. Merchandise sales generated 175.82 million euros of total revenue, with the remaining balance derived from sales and services provided to other H&M Group entities.
Earnings came under heavy pressure from rising operational costs. The cost of goods sold rose to 73.64 million euros from 71.50 million euros, causing gross profit to decrease from 113.09 million euros to 110.82 million euros and gross margin to slip from 61.27 percent to 60.08 percent.
Expense breakdown and earnings decline
Combined cost of sales and operating expenses absorbed 97.18 percent of total revenue at 179.27 million euros, compared to 95.75 percent in the previous financial year.
Professional and consultancy fees grew to 4.86 million euros from 3.59 million euros, while advertising spending increased to 8.7 million euros from 7.8 million euros. Conversely, central management charges levied by the parent H&M Group dropped to approximately 39 million euros from roughly 41 million euros.
Operating profit fell 28.5 percent to 5.25 million euros from 7.34 million euros, and pre-tax profit dropped from 6.71 million euros to 4.43 million euros. After income tax expense of 2.23 million euros, net profit settled at 2.2 million euros.
Global group results and workforce adjustments
At the global group level, performance figures for the first half of fiscal 2026, spanning December 1, 2025 to May 31, 2026, showed net sales of 104.4 billion Swedish kronor, down from 112 billion kronor a year earlier, representing a 1 percent decline in local currencies.
Global operating profit rose to 7.43 billion kronor from 7.12 billion kronor, lifting the operating margin from 6.4 percent to 7.1 percent. Global net profit reached 4.67 billion kronor against 4.54 billion kronor in the prior period, while global gross margin improved to 53.8 percent from 52.3 percent.
In Greece, average workforce headcount decreased by 74 employees, or 7.4 percent, falling from 996 to 922 staff members. Total personnel costs dropped to 19.48 million euros from 19.76 million euros, with salaries declining to 15.55 million euros from 16.05 million euros and employer contributions falling to 3.17 million euros from 3.28 million euros.
Cash flow, equity and audit qualification
Capital spending impacted liquidity, as net investment cash outflows rose to 14.87 million euros from 7.07 million euros in 2024. The company also distributed a dividend of 4.2 million euros during the fiscal year.
Cash reserves dropped by 14.46 million euros to finish at 21.73 million euros, down from 36.19 million euros a year earlier. Total equity contracted to 38.45 million euros from 40.48 million euros, while total assets remained stable at 76.08 million euros.
Auditing firm Deloitte issued a qualified opinion on the financial statements because tax liabilities for fiscal years 2023, 2024, and 2025 have not been audited by state tax authorities. Deloitte noted that H&M Greece has not estimated or set aside financial provisions for potential additional taxes or penalties that might result from a future tax inspection.
Tax compliance history and future outlook
Financial years from November 30, 2020 through November 30, 2025 remain open for inspection by tax authorities. The company obtained unqualified tax compliance reports for 2020 through 2022, but was not subject to certified audit tax reviews from 2023 to 2025. No formal tax audit was underway when the financial report was issued.
The auditor qualification follows an incident in June 2024, when inspections by the Independent Authority for Public Revenue (AADE) uncovered nearly 200,000 issued receipts that had not been transmitted electronically. That case led to administrative fines and 48-hour closures across five stores, which H&M attributed to a technical glitch. Financial reports for 2025 note no significant pending litigation against the subsidiary.
Looking to 2026, H&M Greece management stated that the business aims to increase turnover and expand commercial operations. Amid subdued consumer spending and inflationary pressure on sales costs, company planning calls for strict cost controls, improved inventory management, and full optimization of the capital investments executed in 2025.
Chrysa Tavoultzidou has been appointed General Manager for Sales Market Greece, based in Athens. Tavoultzidou, who brings more than 17 years of experience at H&M after beginning her career in Greece, previously served as Regional Head of HR for Eastern Europe across 21 countries. In her new role, she oversees operations across nine regional markets: Greece, Cyprus, Bulgaria, Serbia, Albania, North Macedonia, Bosnia and Herzegovina, Croatia, and Kosovo.
