Virgin Wines grows sales and shares in contracting online market

Direct-to-consumer retailer Virgin Wines has published modest revenue gains alongside strong customer growth. Investment in acquisition, partnerships and technology has continued as the group builds momentum into the second half of the year.

Virgin Wines UK plc recorded a 2% increase in revenue to £34.7 million for the six months to 2 January 2026, as per the company’s interim results. This compares with £34.1 million in the prior year and stands in contrast to an 11% decline in the wider online drinks market during the same period.

Trading over the key festive window proved particularly supportive, with revenue rising 5% year on year across the seven weeks to 26 December 2025.

The group remains debt-free, with net cash of £10.6 million and gross cash of £17.9 million. This position has been maintained while returning more than £2.7 million to shareholders through share buybacks and increasing inventory ahead of duty changes introduced in February 2026.

Customer acquisition drives growth

A central feature of the period has been a marked increase in customer recruitment. The business added 75,000 new customers, representing a 40% rise year on year, alongside a 12% increase in WineBank membership.

Importantly, this expansion has been achieved without a material increase in acquisition costs, which stood at £15.34, broadly in line with the previous year. The figures point to a measured approach to marketing spend, balancing scale with efficiency.

Current trading suggests this momentum has continued into the second half; customer acquisition rose 54% in January and 83% in February.

Partnerships and channels broaden reach

Commercial partnerships remain an important contributor to growth. Revenue from this channel, including corporate gifting, increased year on year and exceeded expectations at the half-year stage.

The relationship with Moonpig continues to perform well, delivering double-digit growth, according to the company.

This focus reflects a strategy outlined previously. As reported by the drinks business in October 2025, chief executive officer Jay Wright told db that “we have very positive relationships with the likes of Moonpig and we are looking to expand that relationship both in terms of the wine range and other product categories such as beer and spirits”.

Warehouse Wines gains traction

The group’s value-focused arm, Warehouse Wines, continues to expand rapidly; revenue increased 92% year on year during the period, with the customer base reaching 41,100.

Recent trading indicates further acceleration, with revenue up 105% across January and February. The proposition is designed to appeal to a broader audience. Wright explained to db that the concept aims to attract “a different sort of demographic and type of customer to the core Virgin Wine space”, particularly those accustomed to supermarket pricing.

Continued investment amid cost pressures

Revenue for January and February increased 12% year on year, keeping the group on track to meet full-year expectations. This comes despite a backdrop of inflation, rising duties, regulatory costs and ongoing pressure on consumer spending.

The board has opted to increase near-term investment, particularly in customer acquisition, with an additional £0.55 million planned for the current financial year. Even with this higher spend, the company expects to remain profitable at EBITDA level.

Wright said: “We are delighted to see that the investment in our growth strategy is working. We have delivered a 40% increase in new customers acquired, continued to grow our commercial partnerships, achieved 92% year on year growth in our Warehouse Wines value proposition and completed the initial phase of our mobile app development.”

He added that the business has entered the second half “with strong momentum”, pointing to the pace of customer recruitment and the strength of the balance sheet.

The company’s approach builds on foundations set in the previous financial year. As reported by the drinks business, Virgin Wines maintained revenue at £59 million in FY25 while investing in growth, with Wright stating that “now was the right time to invest that cash in growth”.

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