M&S shares rocket on recovery hopes after last year's crippling cyber attack

Marks and Spencer was yesterday boosted by recovery hopes despite counting the cost of a crippling cyber attack and sounding the alarm over a ‘triple whammy’ of fresh challenges.

The high street stalwart reported a 28.8 per cent fall in annual pre-tax profits to £365million after the incident in April 2025 which brought its online fashion sales to a halt for seven weeks.

But boss Stuart Machin said that after what was an ‘extraordinary year’, M&S ‘came out stronger’.

The group said it expected a return to profit growth in the coming year – even as the costs of higher taxes, red tape and war in the Middle East bite.

The bullish outlook sent shares soaring 6.6 per cent, or 21.7p, higher to 348.5p.

The results, covering the year to March 28, showed costs related to the cyber attack totalled £131million.

Revenues from fashion, home and beauty fell by 7.7 per cent but they climbed 7 per cent in the group’s food division.

M&S said it was ‘a year of two halves’ after it was whacked by the cyber attack in the first half, followed by a return to profit and sales growth in the second.

And it revealed that as a result of the episode and its impact on the performance of the business, it had scrapped bonuses for the 63,000-strong workforce, from board members and executives to store managers and shop floor staff.

Machin said: ‘I once said that this was a lost year – but on reflection, it wasn’t. It was a year of learning, and everyone coming together as one team, serving our customers and continuing our transformation.’

However, he warned that the High Street was grappling with major challenges, largely brought about by the Government.

‘Retailers have been hit with a triple whammy of headwinds,’ Machin said.

Those included national insurance hikes and packaging taxes as well as Labour’s workers’ rights rules and ‘cost pressures from the ongoing conflict in the Middle East’.

The hike in employer national insurance will cost £100million when including the pass-through of higher costs from suppliers, he said, dwarfing the ‘few million’ so far attributable to the Iran war, which has choked off energy supplies, pushing up costs.

Meanwhile customers face ‘a lot of uncertainty closer to home’.

Asked about the political turmoil gripping Westminster, Machin steered clear of ‘suggesting who the next prime minister should be’.

But he added: ‘We do hope that we have a Government that starts becoming pro-business, pro-growth, pro-customer, pro-working people.’