Breville Hits $1.1bn Half-Year Revenue Despite US Tariff Hurdles
Breville Group Limited has reported a record half-year revenue of AUD 1.1 billion, overcoming US tariff challenges through strategic manufacturing shifts and robust product innovation. The company’s steady profitability and geographic expansion signal a confident growth trajectory.
- Record half-year revenue of AUD 1.1 billion, up 10.1%
- 80% of US gross profit now from non-China manufacturing
- EBIT and NPAT growth modest at 0.7%, in line with plan
- Strong growth in coffee segment and new markets including Mexico and Middle East
- Interim dividend increased by 5.6% to 19 cents per share
Record Revenue Amid Tariff Challenges
Breville Group Limited has delivered a standout performance for the half-year ended 31 December 2025, posting a record revenue of AUD 1.1 billion. This represents a solid 10.1% increase over the previous corresponding period, driven by new product development, expansion into newer geographies, and a particularly strong showing from its coffee segment. Despite the headwinds posed by increased US tariffs on Chinese imports, Breville successfully mitigated the impact through a strategic manufacturing diversification program, with 80% of US gross profit now generated from products made outside China.
Strategic Growth and Innovation
CEO Jim Clayton highlighted the company’s dual focus on operational resilience and innovation. Key new product launches such as the Oracle Dual Boiler and Encore Esp Pro contributed materially to growth, while the coffee category continued to lead with double-digit revenue increases. Geographic expansion remains a core pillar, with emerging markets like Mexico, China, the Middle East, and Korea collectively growing over 50%. The company also invested heavily in marketing and new product development, including installing 300 Best Buy store-in-store fixtures to boost retail presence.
Navigating Tariffs and Operational Complexity
The US tariff environment presented a significant challenge, with an incremental $42 million paid to US customs authorities during the half. However, Breville’s tactical margin management; through pricing adjustments, distribution mix optimisation, and manufacturing shifts; helped contain margin erosion. Gross margin dipped slightly by 130 basis points to 35.4%, but EBIT and net profit after tax both grew modestly by 0.7%, reflecting disciplined cost control and strategic investment balance.
Embracing AI and Future Readiness
Beyond immediate financial results, Breville is accelerating an enterprise-wide AI transformation, described by Clayton as a systemic evolution rather than a pilot program. This initiative spans all functions and is being built internally, with leadership personally involved in training. This forward-looking approach aims to enhance operational efficiency and innovation capacity, positioning Breville well for future growth cycles.
Financial Health and Outlook
Breville’s balance sheet remains robust, with improved net debt reduced to AUD 43.6 million from AUD 55.1 million a year earlier, despite tariff-related cash outflows. The company declared a 5.6% higher interim dividend of 19 cents per share, reflecting confidence in ongoing profitability. Looking ahead, the FY26 outlook anticipates slight EBIT growth, contingent on stable economic conditions and tariff rates, with continued investment in manufacturing diversification, marketing, research and development, and technology.
Bottom Line?
Breville’s deft tariff navigation and AI-driven transformation set the stage for cautious optimism amid global uncertainties.
Questions in the middle?
- How will ongoing US tariff policies affect Breville’s margin and supply chain in FY27?
- What measurable impacts will the AI transformation have on operational efficiency and product innovation?
- Can Breville sustain its rapid growth in emerging markets amid geopolitical and economic volatility?
