Swedish furniture giant IKEA reported a significant decline in operating profit for the last fiscal year, which ended on August 31. According to data cited by Bloomberg, the company's profit fell by 26% and amounted to about 1.7 billion euros (approximately 1.96 billion US dollars).

Despite this profit reduction, IKEA's total revenue remained stable at 26.3 billion euros, and wholesale sales even grew by 6%. This growth is explained by the fact that retailers restored stocks after the company last year reduced retail prices by an average of 10%, making products more affordable.

IKEA's CFO Henrik Elm emphasized that the decrease in profit was a conscious decision of the company. He said IKEA deliberately lowered prices to support consumer demand during a period of economic slowdown and rising living costs. “We have set ourselves the goal of keeping our products affordable, even at the expense of short-term financial results,” Elm said.

The company’s gross margin fell from 16% to 14% during the reporting period, which is fully in line with the 10% reduction in retail prices. Management believes that such a policy will help IKEA remain competitive in the global market, even if it temporarily reduces profits.

However, external factors have also affected the company’s financial results. Like many other global retailers, IKEA has felt the effects of trade uncertainty caused by the tariff policies of former US President Donald Trump. New import tariffs, along with rising supply costs, have negatively affected profitability — especially in the second half of the fiscal year.

Despite the challenges, IKEA’s management remains optimistic. The company believes that the profit reduction is a temporary and strategically justified step that will strengthen the brand's position in the long term. Thanks to price reductions and stable sales, IKEA hopes not only to retain customer loyalty, but also to expand its share of the global furniture market in the coming years.