Burberry reported a pre-tax profit of £49 million ($66.2 million) for the year ending March 28, 2026, reversing a loss from the previous year [1, 2]. The luxury brand credited stronger bag sales following the launch of its Cotswolds handbag line priced around £2,000 ($2,650), which resonated with American customers [1, 2].

The Cotswolds line replaced the more expensive Knight bag, which sold for over £2,400, as Burberry focused on a price point that hits a "sweet spot" on value in the luxury segment, CEO Joshua Schulman said [1]. "During Mother’s Day in North America the customer has been responding to our vintage check introductions and Cotswolds lines," he added [1].

Burberry’s sales remained flat year-on-year at £2.4 billion ($3.2 billion) on a constant currency basis amid gains and challenges across regions [1, 2]. The brand recorded 10% sales growth in both the Americas and China in the latest quarter, driven by core products including scarves, outerwear, and improving ready-to-wear and bags that appeal to younger shoppers [1, 2].

The company cut £80 million in annual costs and trimmed its store network while regaining customers in China and North America [1]. However, sales in Europe and the Middle East fell due to travel disruptions linked to the Iran conflict, with the Middle East representing 2% of Burberry’s global sales [1]. Burberry shares dropped 5% following investor concerns about the geopolitical impact on business [1].

Despite challenges, Burberry remains optimistic about reaching a future sales milestone of £3 billion [1]. Schulman joined as CEO in 2024 and said shifting from the higher-priced Knight bag to the more accessible Cotswolds model was a key part of Burberry’s strategy turnaround. Reflecting on previous efforts, he admitted, "That strategy didn’t work" in the prior approach [2].

Burberry’s focus on the Cotswolds handbags aims to capture wealthy American buyers attracted to the namesake Cotswolds region in England, often called the "Hamptons of England" for its affluent visitors [1, 2]. The positive customer response on Mother’s Day 2026 reinforced the line’s growing appeal in North America [1, 2].