Burberry sales climb as lower prices and "aspirational" push lift China and the Americas

A clearer turnaround is taking shape

Burberry's move to make prices more accessible and welcome first-time luxury buyers is showing up in the numbers, with China growth defying a broader industry cooldown. Comparable sales for the period through Sept. 26 came in ahead of analyst forecasts, and companywide comps rose 4%.

Greater China gained 5% on a comparable basis, still slower than the first quarter but stronger than big-name rivals that recently reported weaker demand. The Americas added an 11% lift, while the region spanning Europe and the Middle East declined.

Investors noticed. The stock jumped as much as 9.9% in early London trading, the biggest intraday rise since April.

How the company is changing its mix

Two years have passed since Chief Executive Officer Joshua Schulman began a revamp centered on reduced pricing, a leaner workforce, and a fresh spotlight on its hallmark scarves and gabardine trench coats. He cast Burberry's steadier China performance as a "more democratic" take on luxury, saying price cuts have placed the brand in a sweet spot versus "exorbitant pricing" elsewhere. "Our strategy of having enduring value and providing great value for money is resonating strongly with the Chinese customers," he said, adding, "We are playing for a long-term game."

Growth extended across all product categories, including historically softer handbags. Accessories such as handbags and shoes are drawing in newcomers compared with two years back, Schulman told investors and analysts on a later call, pointing to higher-end derby bags as a possible engine for future sales. He emphasized that outerwear remains the lead, even as leather goods take on a larger supporting role.

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Wholesale also outpaced expectations, up 17% for the first half of the year.

Marketing moves, tourist shifts, and the wider backdrop

New campaigns are part of the playbook. Schulman highlighted a "Chinese Valentine's Day" capsule featuring heart-shaped lettering as an example of how the brand is courting fresh customers. He also noted that tourist spending has softened and that more purchases are happening at home rather than on trips.

The broader setup is tough: luxury demand in China has cooled while the sector also contends with ongoing hostilities in the Middle East. Even so, Burberry's China performance held up better than names like LVMH and Kering in their latest updates.

"This marks a fifth consecutive positive quarter," Citi analyst Thomas Chauvet wrote, crediting Burberry with adding new customers and lifting full-price and outerwear sales despite the backdrop.

What this means for your portfolio

Burberry reaffirmed that it expects both revenue and margins to increase over the year, without setting precise targets. A capital markets day in March will outline the next phase, including tactics to win Gen Z through pop-ups and ads featuring celebrities such as actor Pierce Brosnan.

The bottom line: pricing to meet "aspirational" demand is translating into growth in China and the Americas, and wholesale is running ahead of plan. Offsetting that are softer tourist flows and a choppy macro picture in China. Watch the March strategy update for how the mix between outerwear, leather goods, and entry price points evolves.

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