What Happened to H&M (Hennes & Mauritz)?

H&M (Hennes & Mauritz) began its journey in 1947 when Erling Persson opened 'Hennes' (Swedish for 'hers') in Västerås, Sweden, focusing solely on women's clothing. The acquisition of hunting apparel retailer Mauritz Widforss in 1968 led to the inclusion of menswear and the renaming to Hennes & Mauritz, or H&M. The company rapidly expanded across Scandinavia and went public on the Stockholm Stock Exchange in 1974, initiating its international growth with a London store in 1976. The late 1990s and early 2000s marked significant global expansion, including the launch of online retail in 1998 and its first U.S. store in New York City in 2000, solidifying its position as a fast-fashion leader.

In recent years, H&M has faced increasing pressure from intense competition, particularly from ultra-fast fashion rivals like Shein and established players like Zara, alongside macroeconomic challenges and evolving consumer preferences towards sustainability. This led to a strategic shift, including a restructuring plan in 2022 aimed at reducing its global workforce by approximately 1,500 positions and targeting a 10% operating profit margin. The company has also been actively optimizing its store portfolio, with plans to open around 90 new stores and close approximately 170 in 2026, reflecting a move towards a more efficient physical footprint and a stronger omnichannel approach where over 30% of sales occur online.

A key turning point occurred on January 31, 2024, when Helena Helmersson stepped down as CEO after four years, citing the demanding nature of the role during a period of global challenges. Daniel Ervér, a long-time company executive and former head of the H&M brand, was immediately appointed as the new President and CEO. Ervér's mandate has been to improve product offerings, sharpen pricing, shorten lead times, and enhance the overall customer experience, with a strong emphasis on profitability and operational discipline.

As of June 26, 2026, H&M's strategy appears to be yielding mixed but generally positive results in terms of profitability. The company's Q1 2026 report (December 2025 – February 2026) showed a 26% increase in operating profit and an improved operating margin of 3.0%, despite a 1% decrease in sales in local currencies. The Q2 2026 report (March 2026 – May 2026) further highlighted this trend, with operating margins reaching 12.0% (before restructuring costs) and gross margins improving to 56.6%. However, sales in local currencies remained largely flat in Q2, and even declined by 3% when compared to expectations, with Western Europe seeing a 5% drop, indicating that top-line growth remains a challenge. H&M is also making significant strides in sustainability, reporting in March 2026 that 91% of its materials were recycled or sustainably sourced in 2025, and it had reduced Scope 3 greenhouse gas emissions by 34.6% since 2019. The company continues its global expansion, with plans to open its first stores in Paraguay in late 2026 and Argentina in 2027.