Uniqlo on track to overtake H&M, eyes Zara for global No. 1
Owner Fast Retailing has forecast operating profit to reach 830 billion yen for the coming fiscal year ending August 2027
Published Thu, Oct 8, 2026 · 06:09 PM
UNIQLO owner Fast Retailing’s annual revenue climbed 17 per cent to a record 3.96 trillion yen (US$25 billion), putting it solidly on a path to pull ahead of H&M as the world’s No. 2 apparel retailer and challenge Zara for the top spot.
The sales milestone underscores Fast Retailing’s ascent among global high-street fashion retailers, with sales set to surpass Hennes & Mauritz AB, which is projected by analysts to post sales of 222.7 billion kronor (US$22.3 billion) for its fiscal year through November, while narrowing the gap with Zara owner Industria de Diseno Textil SA.
The latest results show how far Uniqlo has come from its origins as a low-price Japanese casualwear chain to become an international brand built around functional all-season apparel, as it pushes deeper into North America and Europe.
Even so, Fast Retailing founder and chief executive officer Tadashi Yanai still needs to more than double annual sales to reach his long-term target and build the global apparel powerhouse he has long envisioned.
“Our milestone of achieving 10 trillion yen in sales is now coming into view,” Yanai said at a news conference in Tokyo. “The goal of becoming global No. 1 has been clear since our founding.”
For the coming fiscal year ending August 2027, Fast Retailing issued a forecast for operating profit to reach 830 billion yen, the clothing company said in a statement on Thursday (Oct 8), in line with analysts’ average estimate. The revenue outlook is 4.45 trillion yen, also matching expectations.
Uniqlo’s resistance to the fast-fashion industry’s emphasis on rapidly changing trends is helping it to build its brand around functional, high-quality everyday clothing, a strategy that has made the business increasingly difficult to replicate, according to Takahiro Kazahaya, analyst at UBS AG Tokyo. “They’re close to being one of a kind,” he said.
Operating profit rose 34 per cent to 743 billion yen, topping analysts’ average estimate.
Asked about taking on Zara’s owner, Yanai said: “Inditex has its own unique characteristics. We have our own characteristics, and we both play to our respective strengths.
“We want to develop our brands so that when people think, ‘I wonder if there is something like this out there,’ Uniqlo is the very first thing that comes to mind,” Yanai said. “Up until now, we have done this primarily in Japan, but I believe the time has come to expand this globally.”
Uniqlo Japan same-store sales rose 5.1 per cent for the year, helped by demand for functional ranges including Ultra Stretch Pants and UV Protection items, as well as trend-led products such as barrel pants.
Overseas operations continued to drive the bulk of growth, with Uniqlo’s international business delivering record revenue of 2.41 trillion yen, up 26 per cent, and profit of 440 billion yen, up 44 per cent, as combined sales in North America and Europe exceeded mainland China for the first time.
Over the past year in the US, Fast Retailing has been opening and upgrading stores, including a second Fifth Avenue store in New York and a Chicago flagship, while also pushing brand visibility through efforts such as the partnership with Major League Baseball.
Earlier this year, the field at Dodger Stadium was renamed Uniqlo Field. Yanai previously told Bloomberg that he is targeting 3 trillion yen in annual US sales, with a goal to expand deeper into Middle America.
Yanai also spoke on Thursday of his ambitions to expand everywhere. “We are embarking on a major challenge aimed at our next phase of growth,” he said. “One of the key stages that will drive this next growth is South-east Asia, Australia and India.” BLOOMBERG
