IKEA profit falls 26pc to $2b as US tariffs fuel costs

LONDON, Nov 10 (Reuters): Sweden's Inter IKEA, which supplies furniture to IKEA stores around the world, said on Friday its annual operating profit dropped 26 per cent as the impacts of US tariffs drove up costs.
The IKEA brand owner said operating profit for the financial year ended August 31 was 1.7 billion euros ($1.98 billion), down from 2.3 billion euros the year before, while revenue fell to 26.3 billion euros from 26.5 billion euros, after it cut prices.
Inter IKEA said in a statement that commodity prices and logistics costs had risen in the second half of the financial year due to uncertainties following US tariff announcements.
Overall sales from IKEA stores across 63 markets around the world fell for a second year in a row to 44.6 billion euros ($52.01 billion), as the budget furniture retailer continued a push to slash prices and lure back shoppers.
While IKEA has cut prices overall, higher US tariffs have forced it to increase prices on some products in the United States, which it imports from factories in Europe and China.
Lithuanian furniture manufacturer SBA, which supplies IKEA, last month launched its first US factory, in North Carolina, manufacturing IKEA products such as its BILLY bookcases and KALLAX shelving units.