H&M said its net profit fell to SEK3.96 billion (US$419 million) for the period of March to May of 2025, down from SEK5.06 billion a year earlier.

“The quarter’s result was negatively affected by higher purchasing prices as a result of a more expensive US dollar and higher freight costs, but also by the fact that we have continued to invest in the customer offering,” H&M chief executive Daniel Erver said in a statement.

Erver noted that “negative external factors that increased the costs of purchasing for the first half of the year are turning positive for the second half of the year”.

Net sales for the company fell nearly 5% to SEK56.7 billion, compared to Q2 2024.

However, the company noted that net sales rose by 1% in local currencies “with 4% fewer stores at the end of the quarter compared with the same point in time the previous year”.

In its quarterly earnings report it said net sales were hit by “a currency translation effect of around six percentage points due to the strengthened Swedish krona”.

H&M also said its sales result in Q2 should “be seen in light of the fact that the Q2 2024 was a strong quarter”.