Naked Wines posts higher profitability despite revenue decline in HY26
Naked Wines has reported a sharp improvement in profitability for the 26 weeks to 29 September 2025, although revenue continued to fall according to its HY26 statement. The group says performance remains in line with FY26 guidance while it continues to unwind excess inventory and cut customer acquisition spend.
Naked Wines delivered adjusted EBITDA excluding inventory liquidation and associated costs of £3.6 million, up 112% from £1.7 million in HY25, according to company figures. Statutory loss before tax narrowed to £3.0 million from £5.6 million after £2.5 million of adjusted items and £2.6 million of inventory liquidation and associated costs.
Revenue fell to £89.5 million from £112.3 million in HY25. On a constant currency basis revenue declined 18%, which the company attributes to the expected decline of large cohorts acquired in FY21 and FY22, the withdrawal of inefficient acquisition investment in late FY25 and HY26, and what it describes as cautious consumer behaviour.
Gross profit margin increased to 19.5% from 16.9%. Naked states that roughly half of the improvement is due to price increases and cost savings, including reduced acquisition cost, with the balance largely reflecting FY25 inventory movements.
Customer acquisition scaled back
Customer acquisition investment fell to £3.9 million from £9.4 million as per the HY26 figures. Customer acquisition cost dropped to £69 from £78.
Naked has replaced its former five-year payback metric with a new acquisition break-even measure. The company also reports that break-even has fallen to 44 months for cohorts acquired in the five months to August 2025, compared with 75 months in HY25. Using its standardised model the group states that HY26 would have been 42 months on a like-for-like basis.
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Revenue per member decreased to £162 from £168, while member retention remained at 76%.
Cash position strengthens
Net cash excluding lease liabilities rose to £31.1 million from £22.9 million, which the group attributes to £10 million of cash generation partly offset by the £2 million share buyback completed in September.
Inventory is down £26 million on the prior year, although it increased by £5 million compared with March 2025 as stock was built for peak trading.
Free cash flow declined to £4.7 million from £7.4 million. Naked links the reduction to cash consumption through inventory despite gains from payables and angel funds. Return on equity and cash increased to 11% from 5% which the company attributes to adjusted EBITDA growth.
Leadership changes
In terms of personnel, the board added Jack Pailing as non-executive chair, Jan Hendrik Mohr as non-executive director and David Atchison as a board adviser focusing on marketing and customer growth.
The company added that its newly acquired Sonoma winery has begun generating initial revenue from custom crush and bulk storage with potential for private label production. It also reports early productivity gains from its digital transformation programme, and a redesign of its homepage and customer journey remains in progress.
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