Biggest IKEA retailer reports profit rise as it tries to sway budget-conscious buyers

The world’s largest retailer of IKEA furnishings reported a rise in annual profit on Tuesday, whereas it tries to convey again cash-strapped customers, and stated it had raised costs within the US lower than rivals as it absorbs some tariff prices.

In what the price range retailer stated had been a yr marked by financial uncertainty, supply-chain challenges, and cost-of-living pressures, its income fell barely to 41.45 billion euros ($48.34 billion), from 41.85 billion the earlier yr.

“Five years of cumulative inflation in society for many people… it’s a massive pressure for people to come to the end of the month,” stated Juvencio Maeztu, CEO of the biggest IKEA franchisee Ingka Group, in an interview with Reuters.

But the quantity of merchandise bought within the monetary yr ending August 31 elevated 1.6%, footfall was up 1.3% and on-line visits rose 4.6%, as IKEA caught to a technique of holding costs low to appeal to cash-strapped customers and acquire market share. Ingka reported an working profit of 1.46 billion euros, up from 1.25 billion in 2024, whereas web profit rose to 1.41 billion euros from 0.81 billion a yr in the past.

Last yr’s outcomes had been impacted negatively by IKEA’s exit from Russia, stated Maeztu, who took over the CEO function at privately held Ingka Group in November. The retailer has additionally labored to function shops extra effectively, he added.

While IKEA has minimize costs general, increased US tariffs have compelled it to enhance costs on some merchandise within the US, which it imports from factories in Europe and China. Maeztu stated IKEA had elevated costs lower than its rivals within the US, nevertheless, including that it had determined to take up a part of the tariff prices.

Last week Inter IKEA, which provides furnishings to IKEA shops all over the world, stated its annual working profit dropped 26% as the impression of US tariffs drove up prices. The US is IKEA’s second-biggest market after Germany, with Ingka making about 12.6% of its gross sales within the US within the 2025 monetary yr.