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Global fashion retail major H&M is restructuring its retail operations as it continues to optimise its store network, simplify its organisation and shift decision-making closer to customers.The group said in its interim results for the 2026 financial year on Thursday that it is continuing with its store portfolio optimisation, which includes updating stores, opening new locations and closing others. For 2026, H&M plans to open about 90 stores while closing around 170 stores as it focuses on growth markets and adapts its physical footprint.The group ended the second quarter with 4,038 stores, down from 4,166 a year earlier. During the first six months of the financial year, 41 stores opened while 104 stores closed, it said.H&M CEO Daniel Ervér said the group’s organisational changes are aimed at improving how quickly it responds to customers.“We have continued to reduce the complexity of the organisation and moved decisions closer to the customer,” Ervér said.The changes resulted in restructuring costs of 679-million Swedish krona ($69.6m) during the quarter, linked to changes across sales markets and central sales organisations, he said.Alongside the store changes, H&M is investing in its digital infrastructure as part of its wider shift towards an integrated shopping model across stores and online channels. The retailer said just more than 30% of sales now take place online.The retailer is also using supply chain improvements and tighter inventory management to improve product availability while holding less stock. Stock-in-trade fell 10% year on year, with H&M saying a more flexible supply chain is helping it balance demand and stock levels.“The investments in the supply chain and the integration of the sales channels continue,” H&M said, adding that improved flexibility is supporting stock availability and reducing tied-up working capital.The retailer’s sales performance remained under pressure with second quarter net sales declining to 54.8-billion krona from 56.7-billion krona a year earlier.Even with lower sales, H&M reported improved profitability, supported by stronger gross margins, cost control and supply chain improvements. Operating profit excluding one-time costs increased 11% while the operating margin improved to 12%.Ervér said the company’s focus remains on strengthening its products, customer experience and brand.“The improvements we have made in recent years have strengthened profitability, simplified operations and increased our ability to act closer to the customer,” he said.H&M is also continuing its expansion into new markets, particularly in Latin America. The group opened its first store in Rio de Janeiro during the quarter and plans further expansion into Paraguay and Argentina.
