Marks and Spencer suffers share price fall following cyber attack
- Marks and Spencer's share price has significantly declined after a recent cyber attack.
- The food division of M&S previously showed strong sales growth, contributing to a notable rise in stock value.
- Despite current challenges, there is confidence in the company's recovery potential and future growth.
In the UK, Marks and Spencer's share price has seen a significant decline following a cyber attack that hindered its near-term earnings potential. This drop comes after a remarkable rise in the firm's stock, which had quadrupled from its 2022 low to attain a five-year high in April 2025. The primary contributor to the earlier surge was the company's food division, which reported an 8.7% sales increase, leading to revenues of £9.02 billion. The performance of M&S's joint venture with Ocado has also been noteworthy, with revenue increasing by 25.2% to £3.09 billion and adjusted EBITDA more than doubling to £62 million. This growth reflects both margin expansion and the successful execution of strategic initiatives by the company’s leadership. Moreover, the firm's adjusted EBIT rose by 17.4% to £985 million, with a corresponding increase in its adjusted EBIT margin. Despite these promising figures, management has adopted a conservative outlook, particularly in light of external pressures such as rising labor costs due to an increased minimum wage and national insurance contributions. This situation is expected to further challenge margins by approximately £120 million. Nonetheless, the online segment of the business, specifically the Food-to-Home (FHB) division, aims to enhance its market share from 34% to 50% while improving online margins through supply chain innovations and digital investments. Looking ahead, analysts anticipate that Marks and Spencer can rebound from these setbacks, although the growth in its food division may slow down as grocery inflation stabilizes. However, the potential for capturing additional market share remains, contributing to an optimistic long-term outlook. The forecast largely hinges on a stable macroeconomic environment and a continued decline in interest rates, which are vital for the company's future performance. Despite the recent turmoil, there remains a belief among investors in M&S's ability to recover and perform well in the stock market.