Waterstones, Britain’s largest book chain, has become an unlikely winner amid a slew of return-to-office mandates gripping London and beyond.
The company saw bumper pretax profits in its previous financial year of nearly £43 million, up fourfold from £11.2 million in the 2023 financial year. A big contributor? Office-goers who’ve been trickling back to in-person work.
“Footfall and sales continue to grow year on year, with encouraging growth in London and other metropolitan city centres as tourist numbers increase and workers return to offices,” the earnings report filed with Companies House earlier this week showed.
Sales at Waterstones, including Blackwell’s and Foyles locations, increased from £452 million to £528 million for the year ended April 27, 2024.
“Waterstones has continued to enjoy good sales in the current financial year and starts 2025 benefiting from a notably strong publishing lineup,” a Waterstones spokesperson told Fortune.
The bookstore chain might be among the few examples where RTO mandates have brought a welcome change.
Companies have tightened their office attendance policies recently, much to the dismay of employees who have built lifestyles around hybrid work since the pandemic kicked off.
WPP, an advertising company, has been among the recent British multinationals to ramp up RTO rules across its global offices. It’s received pushback from employees, many of whom have signed a petition to reverse the edict.
As more companies resort to the “old” ways of working, they’re going the extra mile with trimmings at the workplace that’ll hopefully lure staff back willingly.
Whether RTO mandates are effective might be a different debate, but if British corporations make them the norm, Waterstones will see a more significant boost in its business.
Beyond RTO mandates
Waterstones saw its sales plummet 78% in the year before owing to technical hiccups at its warehouse. At the time, the company said those issues hurt its stock availability and caused operating costs to rise. Meanwhile, the post-pandemic demand had only just started picking back up.
Waterstones’ profits were shy of its blockbuster 2022 figures, when homebound Brits resorted to book-reading as a hobby, pushing pretax earnings to just over £50 million.
Thanks to so-called book influencers and a mix of physical, digital, and audiobooks, book consumption has markedly increased across the U.K., including among children. Even longtime publishers have touted record results in recent years owing to this increase.
While its online business has been expanding, physical bookstores like Waterstones thrive on shoppers browsing and buying books at their stores, and the back-to-office cohorts drive that. The company’s American counterpart, Barnes & Noble (also run by Waterstones CEO James Daunt), has seen a renaissance of brick-and-mortar stores.
“Waterstones has benefited from the increased popularity of both reading and physical bookshops, supported notably by social media and positive press coverage,” its earnings report said.
Update, Jan. 22, 2025: This article has been updated with a statement from Waterstones.
