IKEA, the Swedish furniture giant, reported a one‑percent drop in sales for its 2024‑2025 fiscal year, which ended in August. The decline is attributed to price reductions and weaker consumer spending. Inter IKEA, the company’s holding entity, said total sales for the year amounted to €44.6 billion ($52 billion).
Despite the dip in revenue, IKEA saw a three‑percent increase in both sales volume and the number of customers. Chief executive Jon Abrahamsson Ring explained that over the past two years the company has prioritized lower prices, higher volume, and customer growth. This strategy has involved a 10 percent cut in prices to drive traffic to both online and physical stores.
Ring also noted that consumer confidence has been falling for several years, prompting shoppers to postpone home‑renovation and furniture purchases. The trend is evident across all 63 markets where IKEA operates. To counteract this, Inter IKEA plans to continue lowering prices, albeit at a more modest, normalized rate of one to three percent per year.
The company remains optimistic about the current fiscal year, citing continued growth in volume, customer numbers, and revenue. It is also navigating the impact of U.S. tariffs on imported wood, furniture, and kitchen cabinets. While IKEA’s furnishings sold in the United States face a 15 percent tariff, the firm is not affected by the new 25 percent rate applied to certain products. Ring emphasized the need for predictable, consistent tariff policies and advocated for open, rule‑based trade that benefits both IKEA and the global economy.
Moving forward, IKEA will focus on sustaining growth while adapting to shifting consumer trends and trade policies. With its commitment to affordable prices and customer expansion, the company aims to maintain its position in the global furniture market, relying on its ability to manage complex trade dynamics and evolving consumer behavior.
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