Uniqlo owner Fast Retailing posts record profit for fourth year

[TOKYO] Japan’s Fast Retailing, owner of global clothing brand Uniqlo, booked its fourth consecutive year of record profit on Thursday (Oct 9), citing strong sales in Japan and results in the United States that compensated for higher tariffs.

Operating profit jumped about 13 per cent to 564.3 billion yen (S$4.8 billion) in the 12 months through August, from 500.9 billion yen in the prior period, the apparel maker said in a statement. That beat the company’s own forecast of 545 billion yen and the 546 billion yen average estimate from 16 analysts polled by LSEG.

Fast Retailing forecast operating profit in the year through August 2026 will rise further to 610 billion yen.

Revenue in Japan was boosted by buoyant sales to tourists, while the international segment posted record performance. But its Greater China market continued to struggle, with declines in sales and profits as consumer appetite remained subdued.

From one store in Hiroshima, in western Japan, 41 years ago, Uniqlo has grown to more than 2,500 locations across the world, selling inexpensive fleeces and cotton shirts made primarily in China and other Asian manufacturing hubs.

With the economy cooling in China, the company’s biggest overseas consumer market with some 900 Uniqlo stores on the mainland, Fast Retailing has increasingly looked to North America and Europe for growth.

The company said that it plans to open flagship stores in locations including Frankfurt, Warsaw, Chicago, and San Francisco in fiscal 2026. But its global strategy has been complicated by tariffs imposed by the administration of US President Donald Trump.

Fast Retailing warned in July that US tariffs would start to have a significant impact on its operations in the market later in the year. Even so, price increases and cost-cutting helped the company record increases in sales and profit in the US for the year.

Tokyo and Washington later inked a deal to set a 15 per cent tariff on most Japanese imports, less than the 25 per cent level initially announced. It is uncertain how that impacts Uniqlo goods sold in the US, which are primarily produced in South-east Asia and South Asia.

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Fast Retailing tends to benefit both at home and abroad from a weak yen, which is now trading at the lowest since February against the US dollar and a record low versus the euro.

A tourism boom in Japan has led to a surge in duty-free shopping at domestic stores, while revenue from the company’s Western markets gets an added boost when translated back into yen.

Founder Tadashi Yanai, Japan’s richest man, has long aimed to make his firm the world’s biggest fashion retailer, with Zara owner Inditex and H&M standing in the way. And in recent years, the company has faced fierce price competition from Chinese online retailers Shein and Temu. REUTERS