Trading Update: AO World - HY2026
Blitzkrieging the trade-in market with a £17 a month iPhone17...
Key Finding: AO World reported £585.6m revenue for H1 2026 (+14.4% YoY), with 12.2% growth in consumer sales. New iPhone upgrade product launch set to push deeper into mobile for the remainder of the year.
Recap
On 25th November, the UK’s most trusted electrical retailer1, AO World Plc released their interim results for the 6-months ending 30th September 2025. Since I covered their FY2025 results in June, the solid performance would have been enough to write about, as would the mobile business update that was promised last time, or indeed an update on the musicMagpie integration. However, it was CEO John Roberts launch of Switch24, a new iPhone upgrade proposition, that caught my attention and warranted further investigation.
Performance
Total revenue grew 14.4% YoY to £585.6m (H12025: £512.1m) with the B2C Retail sales (retail sales, membership fees and protection plan commission) coming in at £423.0m up 12.2% from £377.2m this time last year. Consumer sales more than offset the -22.8% decline in B2B retail down to £46.3m from £59.9m as the exit from low-margin contracts took effect. Interestingly, management also noted a decrease in B2B mobile phone transactions that have been used to manage stock levels. Although that might just be a deliberate slow down in trading to maintain inventory prior to the busier half of the year. Further declines were recorded in Network Commissions down 26% to £32.9m from £44.5m as management undergo the structural reengineering of the MNO partnerships. Back to the upside: musicMagpie contributed a full half-year of revenues at £56.0m; Third-Party Logistics were up 15.9% to £16.6m and Recycling also showed improvement up 4.7% to £11.1m.
H1 FY2026 Key Metrics:
- Total Revenue: £585.6m (H1 FY2025: £512.1m, +14.4%)
- B2C Retail Revenue: £423.0m (H1 FY2025: £377.2m, +12.2%)
- Gross Profit: £147.9m at 25.3% margin (H1 FY2025: £125.0m at 24.4%)
- Operating Profit: £17.5m at 3.0% margin (H1 FY2025: £16.4m at 3.2%)
- Profit Before Tax: £17.9m (H1 FY2025: £16.2m, +10.5%)
- Free Cash Flow: £57.1m (H1 FY2025: £14.1m, +306%)
- Net Funds: £65.1m (31 March 2025: £23.4m)
- Total Liquidity: £199.6m (31 March 2025: £147.3m)
Source: AO World PLC Interim Results for 6 months ended 30 September 2025, RNS 25 November 2025
Continue reading for:
Profitability indicators
Strategic Developments including:
Full Switch24 analysis with comparisons to the Apple Upgrade Programme and a lease from Raylo.
Post Pay Mobile & AO Mobile MVNO
musicMagpie Integration
Protection Plan Stability