Confidence, Consistency, and Cash Returns

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Confidence, Consistency, and Cash Returns

UK | General Retailers

AO World EquityJuneResearch17, 2026

TARGET | ESTIMATE CHANGEConfidence, Consistency, and Cash Returns

AO's FY26 PBT has come in a touch ahead of guidance, and consensus RATING BUY

expectations for FY27 have been endorsed. We are encouraged by launch PRICE 96.00p^

of AO Mobile - another facet to the group's expanding ecosystem - and PRICE TARGET | % TO PT 160.00p (155.00p) | +67%

see the announcement of a further £20m capital return as indicative of 52W HIGH-LOW 117p - 83p

management confidence. AO remains a top SMID pick. Buy. FLOAT (%) | ADV MM (USD) 52.3% | 0.44

MARKET CAP £574.3M | $771.3M

Results as expected – another year of impressive growth. AO has landed FY26 PBT at TICKER AO/ LN

£50.5m, a touch ahead of guidance (top end of £45-50m range) and +11% versus our forecast ^Prior trading day's closing price unless otherwise

noted.

a year ago (£45.4m). This marked another year of robust growth, with core B2C Retail revenue

+9.5% and PBT +16%. Leverage was supported by a +70bp improvement in gross margin

(efficiencies, Mobile pivot) and was delivered despite inflationary opex pressures and higher FY (Mar) CHANGE TO JEFe JEF vs CONS

PPC costs. Cash generation was notably strong, with FCF of £66m; this resulted in net debt 2027 2028 2027 2028

swinging from -£36m to +£16m, even after the £10m buyback completed during the year. REV NM NA -1% -2%

Continued progress on customer proposition. Underpinning its success, AO continues to EPS <1% NA +2% -1%

build out its already best-in-class customer proposition. It has become the first retailer to

pass 1m Trustpilot reviews (and with a 4.9-star rating), the Switch24 iPhone 17 for £17 pcm 2027 (p) 1Half 2Half FY