Debenhams Group has reported a return to growth in its first quarter (Q1), buoyed by standout trading performance across its Debenhams and PrettyLittleThing brands, as its turnaround strategy starts to deliver.

In its Q1 trading update spanning the three months to May 2026, the fashion group posted a +0.5% year-on-year growth in Gross Merchandise Value (GMV), with May rising further to +8% versus 2025.

Gross margin for the period rose by +1.4% year-on-year to 53.5%, while the retailer also reduced its cost base by around -5%.

Debenhams Group’s CEO, Dan Finley, attributed the results to the “heavy lifting” of its multi-year turnround roadmap, which has included warehousing consolidation, a cost reset and rebuilding each of its brands on a single platform. “This work is now translating into materially improved profitability,” he said.

As part of its strategy, Debenhams has made several innovation investments to underpin growth and future-proof its operations in recent months.

In February, it announced a new partnership with PayPal to deliver AI-driven shopping experiences, enabling customers to discover, receive personalised recommendations and check out entirely via AI within the PayPal app.

This followed further investments into AI-led post purchase experiences, having teamed up with Seel to support seamless returns and enhance CX beyond the checkout.