Ikea UK has reported retail sales of £2.25bn for the 2025 financial year, down 2.1% on the previous year, despite the home furnishings giant returning to growth in the final quarter, with sales up 3.3%.

The retailer said the improvement followed the impact of long-term investments in affordability and accessibility. After a £117m price reduction programme in FY24, sales volumes rose 4% in FY25, despite ongoing cost-of-living pressures.

Ikea CEO and CSO Peter Jelkeby said: “In a challenging environment marked by economic and trade uncertainties, rising cost-of-living pressures and weakened consumer confidence, I am proud that we continued our programme of strategic investments in the UK to build a more affordable, accessible and sustainable Ikea.”

“We saw these investments begin to pay off in the final months of FY25 and now into FY26, which gives us confidence for the year ahead.”

The results follow Ikea’s expansion of its store network during this year, opening four new stores and two Plan and Order Points, alongside more than 100 new ‘Collect Near You’ points.

The Swedish furniture retailer said that its flagship Oxford Street store drew 1.34m visitors in its first four months.

Meanwhile, online sales also increased 2% year on year, accounting for 43% of total sales, up from 41% in FY24. The business credited improved fulfilment from its Dartford distribution centre and lower delivery prices for members.

Jelkeby said that government support could help sustain retail investment, adding: “Simple, targeted support from government, like easing the burden of business rates, would make a tangible difference, encouraging retailers to continue investing, saving existing jobs and creating new ones.”

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