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Porsche expects operating return on sales for 2024 to come in at the lower range of their guidance, 2025 operating profit to be impacted by vehicle development costs
- Porsche said for 2024, the return on sales is likely to come in at the lower range of the guidance (14% to 15%), automotive net cash flow margin will be over 10% (guidance: 7 to 8.5%) while other key performance indicators do not show significant deviations from the forecast.
- It expects 2025 revenue in the range of €39 to €40 billion (analysts estimate: €40.3 billion) and operating margin in the range of 10% and 12% (analysts estimate: 15.0%).
- The guidance takes into account the decision by the board to include additional vehicle models with combustion engines or plug-in hybrids, battery activities, expansion of the Sonder- and Exklusivmanufaktur and adjustments to the corporate organization which will impact operating profit and the automotive net cash flow by around €0.8 billion.
Assessment
Taking into account the 800 million euros associated with the product developments, the operating margin guidance for 2025 will be almost in-line to forecasts by analysts who attended the recent pre-close call. Their revenue forecast for 2025 is unchanged from that of 2024, hence much better than I had expected given the recent dampened expectations by analysts.