ii view: is Currys a potential AI winner?

Peak festive trading period covering 10 weeks to 10 January

• Group-wide like-for-like (LFL) sales up 6%
• UK & Ireland LFL sales up 3%
• Nordic LFL sales up 12%

Guidance:

• Now expects full year adjusted profit of between £180 million and £190 million versus £162 million last year
• Expects year-end net cash held of more than £100 million

Chief Executive Alex Baldock commented:

"Our Omnichannel model is winning. We gained market share in both UK&I and Nordics, in both stores and online, and our fastest growth was where customers use both channels together. This is a competitive advantage we'll keep building.

“We go into 2026 confident in our strategy and energised by the opportunities ahead."

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ii round-up:

Currys (LSE:CURY) trades across 702 stores and online in six countries including the UK.  

The FTSE 250 index constituent trades under the Currys and Mobile iD brands in the UK and Ireland and Elkjøp in the Nordics. 

For a round-up of this latest trading update announced on 21 January, please click here.

ii view:

Formerly Dixons Carphone, Currys today employs around 25,000 people. Group operations include a product sourcing office in Hong Kong, one of Europe's largest technology repair facilities, as well as an extensive distribution network, centred on Newark in the UK and Jönköping in Sweden.  

Geographically, the UK & Ireland made most sales over its last financial year at 58%. That was followed by Sweden at 13%, Norway 12%, and other Nordic countries the balance of 17%. 

For investors, employee costs for the group’s core UK operations have increased following previous UK government minimum wage and tax changes. A forecast price/earnings (PE) ratio above the three- and ten-year averages may suggest the shares are not obviously cheap. US trade tariffs pushing companies such as Apple to invest in US suppliers are potentially squeezing costs and therefore driving product prices higher, while Currys' previous sale of its Greek business has reduced geographical diversity. 

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To the upside, key measures such as market share, like-for-like sales and profits are all improving. New AI-aided products may support a wave of product upgrades. A store portfolio offers consumers the opportunity to test products and lean on the knowledge of staff before buying, while previously flagged increases in free cash flow support an ongoing £50 million share buyback programme and a forecast dividend yield of around 1.7%. 

In all, and given previously rejected takeover approaches and a consensus analyst fair value estimate above 175p per share, fans of this multichannel retailer are likely to stay optimistic about long-term prospects. 

Positives

• Reduced staff pension deficit and contributions
• A restart of paying shareholder returns

Negatives

• Tough economic backdrop
• Possible impact from US trade tariffs

The average rating of stock market analysts:

Buy