Investment in new technologies key as one third of UK listed retailers issue profit warnings in 2025
One-third of UK-based listed retailers issued a profit warning in 2025, marking the fourth consecutive year that the proportion of warnings from the sector has been at this level or above, according to research by EY Parthenon.
FTSE retailers issued 15 profit warnings in 2025. Although the total number of warnings fell from the 20 issued during 2024, pressure intensified as the year progressed, with nine of the 15 issued in the second half of 2025. The FTSE personal care, drug and grocery sector saw warnings rise to eight in 2025 from five the previous year.
Silvia Rindone, EY-Parthenon UK&I Retail Lead, says: "Changing consumer behaviour is continuing to make the trading environment challenging, with shoppers trading down, delaying purchases until promotions, and becoming increasingly selective.”
“Despite an uplift in retail sales in 2025, this masks the persistent pressures that many businesses are facing. Rising employment costs - from the national living wage to national insurance - have proved difficult to absorb or pass through in a market defined by fierce competition, price wars, and volatile demand patterns.”
“The growing divergence in performance across the sector reflects another structural challenge: the accelerating pace of digital and AI enabled transformation. Those able to invest in new technologies, automation and operational agility are pulling ahead, while others are struggling to keep up as tech savvy competitors move quickly to capture market share.”
“Varied Christmas trading results highlighted these pressures, as well as the growing gap between winners and those falling behind. Success in the year ahead will depend on clarity of proposition, and the ability to drive full‑price sales and loyalty in a market where consumers are more discerning than ever.”
RTIH AI in Retail Awards
RTIH proudly presents the first edition of its AI in Retail Awards, sponsored by VenHub Global, 3D Cloud and EdTech Innovation Hub.
As we witness a digital transformation revolution across all channels, AI tools are reshaping the omnichannel game, from personalising customer experiences to optimising inventory, uncovering insights into consumer behaviour, and enhancing the human element of retailers' businesses.
With 2026 set to be the year when AI and especially gen AI shake off the ‘heavily hyped’ tag and become embedded in retail business processes, our newly launched awards celebrate global technology innovation in a fast moving omnichannel world and the resulting benefits for retailers, shoppers and employees.
Our 2026 winners will be those companies who not only recognise the potential of AI, but also make it usable in everyday work - resulting in more efficiency and innovation in all areas.
Winners will be announced at an evening event at The Barbican in Central London on Thursday, 29th January. This will kick off with a drinks reception in the stunning Conservatory, followed by a three course meal, and awards ceremony in the Garden Room.
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