Porsche's 2025 profits plummet by 3.9 billion euros due to write-downs and a 92% drop in sales

Investing.com - Porsche AG (ETR:P911_p) announced on Wednesday that its 2025 ordinary share earnings per share are €0.47, a significant decline from €3.94 last year, due to a €3.9 billion write-down that nearly wiped out profits in its automotive division, which generated €32.2 billion in automotive sales revenue.

Group operating profit plummeted 92.7% to €413 million from €5.64 billion, with the sales return on investment dropping sharply from 14.1% to 1.1%. Group revenue decreased 9.5% to €36.27 billion. After-tax profit fell 91.4% to €310 million.

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Operating profit in the automotive division declined 98.3% to €9 million, with a sales return of just 0.3%. The €3.9 billion expense includes €2.4 billion in restructuring costs, €700 million related to battery activities, and €700 million in costs associated with U.S. tariffs.

Free cash flow from automotive operations dropped 59.5% to €1.5 billion, representing 4.7% of automotive sales revenue, down from 10.2% last year.

Net liquidity in the automotive business decreased 14.2% to €7.3 billion. R&D costs recognized on the income statement rose to €3.16 billion, accounting for 9.8% of automotive sales revenue, up from 5.6% in 2024.

Vehicle deliveries declined 10.1% to 279,449 units. Vehicle sales fell 15.0% to 265,663 units, but due to stronger pricing and model mix, average revenue per vehicle increased from €117,000 to €121,000.

The Macan remains the best-selling model with 84,328 units sold, up 2%, while the 911 set a delivery record at 51,583 units, up 1%. Cayenne dropped 21% to 80,886 units, 718 declined 21% to 18,612 units, and Taycan decreased 22% to 16,339 units. EU cybersecurity regulations have limited the supply of 718 and gasoline-powered Macan models in Europe.

North America accounts for 31% of deliveries, up from 28%, totaling 86,229 units. China’s market share fell from 18% to 15%. Pure electric vehicles made up 22.2% of deliveries, up from 12.7%.

The company will propose a dividend of €1.00 per common share and €1.01 per preferred share at the annual shareholders’ meeting in June, subject to shareholder approval, with a payout ratio maintained at 50%.

Porsche expects group revenue of €35 billion to €36 billion in 2026, with a sales return of 5.5% to 7.5%, while warning that vehicle sales will be below 2025 levels.

The company stated that further special expenses are expected in 2026, though at lower amounts. Automotive EBITDA margin is projected to be 15% to 17%, with an electric vehicle share target of 24% to 26%.

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