The Formula Fueling Uniqlo’s Record-Breaking Profits

For a fourth consecutive year, Uniqlo reported record profits and is now eyeing a fifth year of breakthrough earnings with its global retail push. According to Reuters, profits increased roughly 13%, reaching $3.69 billion (564.3 billion yen) in the 12 months ending in August 2025. As the fashion industry reels from an uncertain year impacted by international trade reforms and economic instability, what is the Japanese retailer’s secret to success?

Uniqlo’s owner, Fast Retailing, saw its Japanese revenue surpass 1 trillion yen, a first-ever for the company. Meanwhile, in North America, revenue and business profit grew by 24.5% and 35.1%, respectively, despite the US’s newly enacted tariffs. The worldwide numbers overtook the company’s own fiscal 2025 forecast of 545 billion yen, and Fast Retailing expects that 2026 operating profit may once again break records, reaching up to 610 billion yen.

“As the times continue to change greatly, Uniqlo’s LifeWear concept has begun to gain broad recognition in major global markets,” said Tadashi Yanai, CEO and founder, in an official statement. “We are confident that we can fundamentally transform the very concept of clothing on a global scale and spark a movement that establishes LifeWear as a new world standard,” he added.

In an environment so highly saturated with competitors, Uniqlo’s highly curated approach to product is what differentiates the retailer. In comparison to shopping at an H&M or a Zara, where one might notice a focus on trend-forward assortments, busier patterns, and louder embellishments, Uniqlo is noticeably pared back in its presentation.

In short, where competitors may have focused intensely on the look, Uniqlo has always been more about the feeling

The company has maintained a strong focus on offering reliable basics, like roomy blank tees and utilitarian fleeces, while also dedicating effort to developing seasonal technical lines like AIRism and HEATTECH. In short, where competitors may have focused intensely on the look, Uniqlo has always been more about the feeling — but that in no way means Uniqlo doesn’t serve the designer-inclined customer. Instead of attempting to imitate the world’s tastemakers, Uniqlo collaborates with them. From Lemaire to JW Anderson and Clare Waight Keller, Uniqlo’s timely roster of designer collaborations has only enhanced its credibility among fashion enthusiasts.

Following the successful 2023 launch of Clare Waight Keller’s Uniqlo : C line, the British designer was officially named Uniqlo’s global creative director in September 2024. Tasked with guiding the brand’s mainline collections with her seasoned eye, the former Chloe and Givenchy director’s appointment was only the latest in a lineage of designer tie-ups that have gradually built Uniqlo’s global reputation.

One of Uniqlo’s earliest collaborations came about with Jil Sander‘s 2009 collection, +J. The German designer set the tone for the retailer’s future partnerships, which would continue to enlist designers who share a pared-down, contemporary aesthetic. It wasn’t until Uniqlo U launched that its collaborations began to evolve into perennial in-house lines. Lemaire founder Christophe Lemaire and co-director Sarah Linh Tran officially joined Uniqlo as artistic directors of Uniqlo U in 2016. Complementary to Uniqlo’s expertise in basics, the refined tailoring and minimalist ethos of Lemaire made it an ideal partner to elevate Uniqlo’s standing in the global fashion scene.

In step with the retailer, Lemaire has seen rapid growth, partially thanks to a €4.5 million investment from Fast Retailing in 2018. According to BoF, Lemaire’s in-house sales increased tenfold from roughly €10 million in 2019 to over €100 million in 2024. One could see how the French luxury brand’s growing popularity is a helpful appendage to Uniqlo’s strategy.

In a more overt approach, the JW Anderson x Uniqlo line boasts the designer’s recognizable wordmark. It was only four years into Jonathan Anderson’s decade-long tenure at Loewe when Uniqlo inked its first partnership with his namesake label in 2017. The Northern Irish designer had enjoyed modest popularity before his appointment at the Spanish house, but it was his new big-name role that fueled collaborations not only with Uniqlo but also with Converse in the same year. While the Converse partnership stalled in 2019, Anderson and Uniqlo are still in close collaboration, having unveiled their FW25 collection just this week.

With Gucci‘s store traffic picking up following Demna‘s highly anticipated debut, one could imagine Anderson’s buzzy Dior debut sending more customers into Uniqlo for his collaborative line. While conglomerates like Kering and LVMH quell the “luxury slowdown” with strategic role changes and price increases, Uniqlo stands in a prime position to capture the consumer fallout with its affordable collaborations. However, enthralling luxury enthusiasts isn’t all Uniqlo is about.

Just as much as it has impressed fashion buffs, it has also kept a firm finger on the pulse of contemporary art and entertainment. The Uniqlo UT line has incorporated various global IPs in its graphics, with particular attention to emergent anime titles like Chainsaw Man and Dan Da Dan. Elsewhere, in the art world, UT has licensed works from late modern masters like Jean-Michel Basquiat and Keith Haring, who have seen a surge in popularity among Gen Z. Perhaps its largest move in the art space was its appointment of contemporary sculptor KAWS as its first artist-in-residence this season.

None of this is to say that Uniqlo’s mainline hasn’t played a part in its success. Its unisex nylon crossbody bag, now offered in a spectrum of seasonal colors, became a major hit among younger shoppers in 2023. The brand’s simplicity is evidently one of its most attractive qualities in such a highly saturated fast fashion market.

The Tokyo-based retailer has also perhaps benefited from shifts that have driven more Western consumers to Japanese fashion. The country’s manufacturing standards and strong culture of craftspeople have made it a beacon for quality production, especially in the West, where “Made in USA” has been supplanted by low-cost offshoring, and luxury European workshops increasingly find themselves tied up in labor scandals. Uniqlo’s recent collaboration with Japanese streetwear label Needles is just one example of how this trend is playing out within the brand.

One will notice that across Uniqlo’s collaborations and mainline, a familiar thread of refined style and functionality remains consistent throughout. The retailer’s simple “Lifewear” is true to its roots, which began with founder Tadashi Yanai in 1984. The businessman drew his core inspiration from classic American apparel retailers like Gap when he opened the original “Unique Clothing Warehouse” in Hiroshima. The company’s global expansion began in the early 2000s, followed by the advent of its earliest collaborations.

The global rise of Uniqlo over the last two decades — culminating in its recent record-breaking years — speaks not only to the geographic shifts impacting the epicenters of style, but the weakening stature of luxury today.

More than 40 years since its founding, Uniqlo’s strong performance overseas has disrupted the realm of mass-market retailers, historically ruled by European giants like H&M and Zara. As it stands, Fast Retailing’s data shows that though it still trails behind the two fast fashion giants in sales, Uniqlo is leading in terms of growth. Uniqlo appears to be the only Asian company competing at this level, standing ahead of American companies like Gap, Lululemon, PVH Corp, and more.

The global rise of Uniqlo over the last two decades — culminating in its recent record-breaking years — speaks not only to the geographic shifts impacting the epicenters of style, but the weakening stature of luxury today. During Uniqlo’s most successful years, luxury brands have struggled to keep high-spending customers engaged. Amidst fashion’s fluctuating environment, Uniqlo’s affordable mixture of timeless wardrobe standards and designer-led diffusions may be the main ingredients to its winning formula.

Click here to view full gallery at Hypebeast