Key Highlights

  • Lovisa reported FY26 Revenue of AUD 938.8 million, increasing 17.6% YoY, while net profit after tax rose 10.7% to AUD 95.6 million.
  • The company opened 160 stores during FY26, expanding its international retail presence while closing 43 underperforming locations.
  • Gross profit increased 18.4% to AUD 775.3 million, with the gross Margin improving to 82.6%.
  • During the first eight weeks of FY27, total sales increased 16.4% in constant currency, while comparable store sales grew 3%.

Lovisa Holdings Limited (ASX:LOV) operates a global fashion jewellery and accessories retail business, offering earrings, necklaces, bracelets and piercing services through shopping centre stores and online channels. Its operating model focuses on accessible pricing, frequently refreshed product ranges and international store expansion. During FY26, the company continued growing its retail footprint across Europe, the Americas and other markets, supporting higher revenue and profitability. However, modest comparable store sales growth highlights the importance of generating sustainable returns from new store openings while maintaining product margins and operating efficiency.

FY26 Financial Performance and Profitability

For the financial year ended June 2026, Lovisa reported revenue of AUD 938.8 million, representing growth of 17.6% compared with FY25.

Gross profit increased 18.4% to AUD 775.3 million, while gross margin improved by approximately 60 basis points to 82.6%.

The margin performance reflected product pricing, sourcing arrangements and inventory management across its international operations.

Earnings before interest and tax increased 14.1% to AUD 158.2 million.

Net profit after tax rose 10.7% to AUD 95.6 million, reflecting higher revenue alongside continued Investment in retail expansion.

Operating cash flow increased approximately 21% to AUD 294.5 million, supporting store development and Working Capital requirements.

Comparable store sales increased 2% during FY26, indicating that most revenue growth came from additional retail locations rather than higher sales at existing stores.

The company declared total FY26 dividends of 86 Australian cents per share, compared with 77 cents in FY25.

International Store Expansion and Network Development

Lovisa continued expanding its global store network during FY26, with 160 new store openings.

The company also closed 43 locations and relocated 12 stores as part of ongoing network management.

At the end of FY26, Lovisa operated 1,136 stores across more than 50 markets, compared with 1,031 stores a year earlier.

Europe accounted for 76 new store openings, including 34 in the United Kingdom and 20 in Germany.

The Americas contributed 44 additional stores, reflecting continued development across established and newer territories.

Lovisa also entered six Franchise markets during FY26: Réunion, Mauritius, Ghana, Kenya, Burkina Faso and Iraq.

These developments expanded its international customer base while diversifying geographical revenue opportunities.

The company continues evaluating potential store locations based on customer demand, operating costs and expected profitability.

However, expansion also introduces additional Lease commitments, staffing requirements and inventory investment.

Jewellery Product Strategy and Retail Margins

Lovisa's operating model is centred on affordable, trend-led jewellery supported by rapid product development and frequent merchandise updates.

Its product categories include fashion earrings, necklaces, rings, bracelets, hair accessories and piercing-related services.

The company operates primarily through small-format retail stores, allowing it to establish locations across shopping centres and high-street retail environments.

During FY26, gross margin increased to 82.6%, reflecting the company's product sourcing and pricing structure.

Maintaining this margin remains important because international expansion increases expenditure associated with store operations, wages, logistics and distribution.

Lovisa continues rolling out its Series 5 store format, with 53 stores operating under the format by the FY26 reporting date.

The newer store design is intended to improve product presentation and customer experience.

However, the financial benefits of store refurbishments and additional openings depend on sales productivity and operating expenses.

Early FY27 Trading and Store Opening Plans

Lovisa's initial FY27 trading update indicated continued revenue growth across its retail network.

During the first eight weeks of FY27, total sales increased 16.4% on a constant-currency basis compared with the previous corresponding period.

Comparable store sales increased 3%, representing a modest improvement on the 2% growth recorded during FY26.

Management continues targeting approximately 160 new store openings during FY27.

The expansion programme is expected to focus on international markets, supported by the company's existing sourcing and distribution infrastructure.

Europe and the Americas remain important contributors to planned network growth.

However, early trading results cover a relatively short period and may not reflect performance across the full financial year.

Consumer demand, store Maturity and regional economic conditions will influence the contribution from new locations.

Business Risks and Operational Priorities

Lovisa remains exposed to discretionary consumer spending, fashion trends, competition and international operating costs.

Rapid expansion increases execution risks associated with site selection, staffing, inventory allocation and Supply chain management.

The closure of 43 stores during FY26 demonstrates the importance of assessing location profitability and responding to underperforming sites.

Changes in Import tariffs, exchange rates and freight costs may also influence product margins.

Competition across affordable jewellery, fashion accessories and piercing services could affect customer Demand and promotional activity.

Management's priorities include maintaining gross margins, improving comparable store sales and generating sustainable returns from its international expansion programme.

Key Insights

Lovisa Holdings Limited (ASX:LOV) delivered higher revenue and profitability in FY26, supported primarily by international store expansion. Its 160 new openings helped increase the global retail footprint, while comparable store sales growth remained modest. Early FY27 trading showed continued revenue growth and some improvement in comparable sales. The company's ability to maintain its high gross margin, manage underperforming locations and achieve profitable expansion will remain central to its operating performance.