Burberry returns to growth but Middle East conflict continues to drag on European sales

See more This is Money on Google - save us as a Preferred Source Updated: 03:44 EDT, 17 July 2026 Burberry has declared its turnaround plan is starting to pay off, but warned that the Middle East conflict continued to weigh on European shoppers. Chief executive Joshua Schulman, who has led a recovery since joining two years ago, said a rise in quarterly sales showed the ‘strategy is working’, as Burberry recorded growth across all of its divisions for the first time since 2023.'For the first time in three years, we saw growth across our Womenswear, Menswear, Accessories and Childrenswear divisions, anchored by the outperformance of Outerwear,' he said. The British luxury house reported comparable sales growth of 5 per cent to £455million for the 13 weeks to 27 June. Sales in China increased 9 per cent after attracting new Gen Z customers, while sales in the Americas grew 12 per cent.It followed a campaign – ‘The Trench Portraits of an Icon’ – launched in March to mark the fashion house’s 170th anniversary. It included celebrities such as footballer Eberechi Eze, actor Jonathan Bailey and model Kate Moss. Burberry reported a rise in first quarter sales amid continued demand for its trench coatsBurberry said it had seen a 19 per cent increase in new customers for its rainwear products following the campaign and continued to see ‘strong demand’ for scarves and its staple outerwear products, including trench coats.Sales of its women’s handbags also returned to growth.This helped to offset a 3 per cent fall in sales in its division covering Europe, the Middle East and Africa as the US-Iran conflict drags on tourist spending.The war has disrupted tourism to European shopping hotspots such as Paris, as well as reducing footfall to shopping malls in key luxury hubs like Dubai.The FTSE 100-listed firm said it was ‘mindful’ of the war and the wider macroeconomic environment on consumer confidence in its outlook for the year ahead.Burberry shares fell by 3.96 per cent to 1,076p in early trading.Richard Hunter, head of markets at Interactive Investor, said: ‘The dip in the shares at the open is further proof that there are those who remain unconvinced of a turnaround. 'Even so, if momentum is maintained as evidenced by the last few trading updates, there will be increasing upward pressure on a market consensus which currently stands at a hold, albeit a strong one.’Earlier this week, Schulman – who has been on a drive to restore the group’s reputation for ‘timeless British luxury’ – came under pressure from shareholders.At Burberry’s annual general meeting on Wednesday, the British fashion house faced an investor revolt over pay as 35 per cent voted against a huge £12.2million bonus for Schulman.DIY INVESTING PLATFORMSAJ BellAJ BellEasy investing and ready-made portfoliosHargreaves LansdownHargreaves LansdownFree fund dealing and investment ideasinteractive investorinteractive investorFlat-fee investing from £4.99 per monthFreetradeFreetradeInvesting Isa now free on basic planTrading 212Trading 212Free share dealing and no account feeAffiliate links: If you take out a product This is Money may earn a commission. These deals are chosen by our editorial team, as we think they are worth highlighting. This does not affect our editorial independence.Compare the best investing account for you