AO World (LSE:AO), the UK-based online electrical retailer, announced on Wednesday a 27% rise in adjusted pre-tax profit, reaching £43.5 million for the fiscal year ending March 31, 2025. This performance exceeded the company’s earlier revised profit guidance of £39-44 million.

The company’s core business focused on direct-to-consumer retail experienced robust growth, with revenues increasing 12% to £832 million. On a like-for-like basis, group revenue expanded 7% to £1.108 billion, fueled by the continued success of AO’s Five Star membership program and a broadened product range now offering approximately 9,000 items.

Adjusted pre-tax profit margin improved to 4.1%, up from 3.3% in the previous year, reflecting progress toward AO’s medium-term target margin of 5%.

John Roberts, AO’s Founder and CEO, remarked, “Celebrating our 25th anniversary, this has been our strongest year yet. We delivered record pre-tax profits, grew sales substantially, and continued to provide our growing customer base with reliable, exceptional service.”

The Five Star membership program showed solid momentum, with rising membership numbers, strong renewal rates, and increased share of customer spend. Repeat customers contributed over 60% of total orders, a figure AO expects to rise as its offerings and brand awareness expand.

Financially, AO World ended the year with net cash of £23 million, after acquisition-related costs for musicMagpie and funding its Employee Benefit Trust. The company also boosted its Revolving Credit Facility from £80 million to £120 million, extending its maturity to October 2028.

Looking forward, AO World forecasted adjusted pre-tax profits of £40-50 million for fiscal 2026, despite ongoing macroeconomic uncertainties. The company remains optimistic about capturing long-term opportunities within its estimated £28 billion total addressable market.

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