H&M's CEO Daniel Erver acknowledged that the recent sales uptick due to colder weather would not suffice to meet a 10% operating profit margin target, citing persistent consumer cost-of-living issues as a challenge for the brand. Despite maintaining good cost control, the company's operating profit missed analyst expectations, reflecting broader struggles in the retail environment.
Erver has initiated a strategic pivot aimed at enhancing H&M's brand appeal and operational effectiveness, focusing on improving product quality and store aesthetics. He emphasized that the company would prioritize initiatives directly tied to brand strength and profitability, in a bid to regain a competitive edge against rivals like Inditex and the rising threat posed by Shein.
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