M&S accelerates digital transformation after major cyber attack

Marks & Spencer (M&S) is accelerating its digital transformation plans following a major cyber attack that is projected to cost the company £300 million (US$400 million) in lost profits.

Weeks after the attack, the UK retailer said it will respond by accelerating a planned two-year overhaul of its digital operations, bringing it to completion sooner.

“We are seeking to make the most of the opportunity to accelerate the pace of improvement of our technology transformation and have found new and innovative ways of working,” said M&S CEO Stuart Machin.

M&S accelerates digital transformation

The cyber attack on M&S occurred over the Easter weekend. Since then, its teams have “worked around the clock with suppliers and partners to contain the incident and stabilize operations,” taking proactive measures to minimize the disruption for customers, according to Machin.

“We are focused on recovery, restoring our systems, operations and customer proposition over the rest of the first half, with the aim of exiting this period a much stronger business,” he added.

M&S is using the disruption to bring forward its digital investment, rephasing the original program and accelerating plans to upgrade infrastructure and network connectivity, store and colleague technology and supply chain systems.

“This will reduce the inter-dependency of systems and improve operational resilience,” Machin said. “Our overall aim remains the same, to improve technology foundations, simplify infrastructure and applications, to increase resilience further and lower technology run costs.”

Cyberattack disruption expected to last through July

Since the incident, M&S food sales have been impacted by reduced availability, although this is now improving. “We have also incurred additional waste and logistics costs, due to the need to operate manual processes, impacting profit in the first quarter,” said Machin.

In fashion, home and beauty, online sales and trading profit have been heavily impacted by the necessary decision to pause online shopping, however stores have remained resilient. M&S expects online disruption to continue throughout June and into July as it restarts then ramps up operations. This will also mean increased stock management costs in the second quarter.

“Overall, strategy remains the same and there is no change to our longer-term plans to reshape M&S for growth,” Machin said. “We are confident that we will enter the second half with a strong customer proposition, returning to the performance we were delivering immediately prior to the incident and throughout 2024/25.”

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