Summary
This report presents the Sage UK Small Business Tracker for the fourth quarter of 2025, detailing the performance and trends of small businesses across the UK. The report indicates that small business profits grew by 6.2% year-on-year, marking the highest growth rate in nearly four years, driven by a 3.3% increase in real revenues. Despite the profit growth, expenditures also rose by 2.1%, although at a slower pace than revenues, which contributed to the overall profit increase. The report highlights a decline in productivity by 2.6%, contrasting with the positive trends in profit and revenue. Additionally, it notes that the UK economy grew by 1.0% in the same period, amidst a backdrop of trade shocks and budget impacts that have left business sentiment fragile. The report further discusses the challenges small businesses face, including rising wage costs and ongoing uncertainty regarding consumer demand, while forecasting modest economic growth in the near term.
