Marks & Spencer targets double-digit operating margin in fashion and home division

UK retailer Marks & Spencer Group (M&S) has outlined its medium-term growth targets during its Capital Markets Day on November 10, 2026. The London based company plans to achieve mid-to-high single-digit sales growth across the group, with profit expansion outpacing revenue. The ambitions form the next phase of its ‘Reinvesting for Growth’ transformation agenda.

For its Fashion, Home & Beauty division, M&S aims to lift online participation towards 50 percent while operating 180 highly productive brick and mortar stores. The division is targeting an operating margin of more than 10 percent across both online and store channels, alongside continued market share gains.

International operations will focus on expanding the brand presence globally through capital-light channels. Meanwhile, the food division intends to double sales over time, after growing annual revenue by more than 50 percent since financial year 2022 (FY22), while maintaining an operating margin around 5%.

Cost reductions and shareholder returns

To support the margin goals, M&S remains on track to deliver 600 million pounds in structural cost reductions by financial year 2028 (FY28). Management indicated that operational investments will help establish the next phase of cost savings, driving productivity across its supply chain and operations.

The retailer has restored its balance sheet to an investment-grade position over the past four years, moving into a net funds status supported by liquidity. Free cash flow is expected across each of the next three years, enabling the group to invest while increasing capital returns to investors.

M&S plans to double its full-year 2026/27 dividend to 8.4 pence from 4.2 pence. Moving forward, the company intends to grow dividend payments at least in line with earnings over time.