Marks & Spencer Faces £12M Loss Amid Cybersecurity Breach
In the first half of the fiscal year, Marks & Spencer experienced a sharp downturn following a major cyberattack at the end of May that disrupted its online operations for several months.
Despite the setback, the retailer reported a 22.5% rise in global sales. However, the fashion division’s operating margin dropped significantly from 12% to 2.7%, largely due to the attack’s impact on digital sales and increased operational costs.
The British retailer closed the six-month period ending September 27 with a net loss of £11.8 million ($15.4 million), compared with a profit of £278.6 million ($364 million) a year earlier. Operating profit also plummeted from £448.7 million ($586.5 million) to £91 million ($118 million).
“The last six months have been an extraordinary period for the company, and the temporary effects of the cybersecurity incident can be seen reflected in the first half results,” the company stated.
Falling online sales, rising costs in fashion operations, and higher levels of discounting and wastage in grocery products further reduced profitability for the UK retailer.
Author’s Summary
The cyberattack in May led Marks & Spencer to record a £12 million loss in the first half, despite overall sales growth, highlighting the lasting financial impact of digital disruptions.