Is the UK's beloved bakery chain, Greggs, facing a decline in popularity? Recent reports indicate that the company's profits have taken a hit, with a 17.9% drop in statutory pre-tax profits to £167.4m for the year ending December 27th, 2025. This comes as a surprise to many, given the brand's reputation for its iconic sausage rolls and steak bakes. But what's behind this slump?
The bakery chain has attributed the decline to challenging market conditions, including rising living costs, higher tax and labor expenses, and the increasing popularity of weight-loss treatments. However, the company's CEO, Roisin Currie, remains optimistic, stating that the brand has a proven track record of bouncing back from downturns.
Despite the current challenges, Greggs is planning for the future. The company has announced 121 net store openings in 2025, bringing its total shop estate to 2,739 locations by the end of the year. With ambitions to grow to 'significantly more than 3,000 UK shops over the longer term', Greggs is aiming to expand its reach and cater to more customers.
However, some analysts are skeptical about the long-term prospects for Greggs. Darren Shirley, a Shore Capital analyst, suggests that the company has little to celebrate as trading slows. On the other hand, Aarin Chiekrie, an equity analyst at Hargreaves Lansdown, believes that Greggs is laying the foundations for future growth by adapting its menus to changing customer preferences and extending its shop hours to cater to more evening customers.
So, is the UK's love affair with Greggs coming to an end? Or is the company simply adapting to changing market conditions and consumer preferences? The future remains uncertain, but one thing is clear: Greggs will need to continue innovating and evolving to stay ahead in a competitive market.
