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With the financial year ending in August, Sweden’s Inter Ikea – one who supplies Furniture For IKEA stores globally – it said its annual operating profit declined 26% due to increased costs due to US tariffs.
Operating profit for the fiscal year ended Aug. 31 was 1.7 billion euros ($1.98 billion), down from 2.3 billion euros a year earlier, while revenue fell to 26.3 billion euros from 26.5 billion euros after deductions. pricesAccording to the owner of the IKEA brand.
The furniture maker announced that sales of IKEA stores in 63 markets around the world fell for the second year in a row to 44.6 billion euros ($52.01 billion).
Inter Ikea said in a statement that commodity prices and logistics costs had increased in the second half of the financial year due to post-US uncertainties. Tariff announcements
While IKEA has cut prices overall, higher U.S. tariffs have forced it to raise prices in the United States on some products it imports from factories in Europe and China. Lithuanian furniture maker SBA, which supplies to Ikea, opened its first U.S. factory in North Carolina last month, producing Ikea products like Bili bookcases and Kallax shelving units.
Inter Ikea Chief Financial Officer Henrik Elm told Reuters the factory was planned long before US President Donald Trump initiated tariff-increasing policies.
“Obviously, it’s very timely, because it’s also helping us mitigate the impact of tariffs on those best-selling products,” Elam said in an interview.
Inter Ikea said wholesale sales volumes increased by about 6% compared with last year as shoppers responded to lower prices by buying more.
US Supreme Court justices cast doubt on the legality of Trump’s tariffs on Wednesday in a case that has wide-ranging implications for how Trump governs. The president, who has warned that taking away the authority to set tariffs would be a disaster, said Thursday that his administration would need a kind of Plan B if the court’s decision went that way.
During a conversation with reporters in the Oval Office on the issue, a reporter noted that Chief Justice John Roberts had said that the tariffs were actually taxes paid by Americans.