Porsche has cut its guidance and will delay the rollout of its new electric SUVs amid a decline in profits, with shares dropping by 7.2% during Monday's European session.
The company previously said its new SUV series would be fully electric, but these models will instead be initially available as combustion engine and plug-in hybrids. It has forecast an additional operating profit hit of up to EU€1.8 billion (A$3.22 billion) this year.
“Today we have set the final steps in the realignment of our product strategy. We are currently experiencing massive changes within the automotive environment. That's why we're realigning Porsche across the board,” says Porsche CEO Oliver Blume.
“In doing so, we want to meet new market realities and changing customer demands – with fantastic products for our customers and robust financial results for our investors.”
A new platform for electric vehicles that Porsche planned to introduce in the 2030s will also be delayed, the company said.
Porsche said its operating profit is set to drop due to the United States’ tariffs and the slowdown in China’s luxury market, as well as the delay in its electric vehicle plans. Its updated guidance includes a return on sales of up to 2%, down from 5% to 7%.
The company’s projected EBITDA margin is now 10.5% to 12.5%, compared with the previously forecast 14.5% to 16.5%. Expected revenue remains unchanged at €37-38 billion.
Volkswagen, which owns around 75% of Porsche, also lowered its profit margin guidance from 2% to 3%, down from 4% to 5%.
Porsche exited Germany’s blue-chip DAX index on Monday, following an extended share price slump and several cuts in guidance this year. It halted its plans for electric battery production last month.
Porsche’s (FWB: P911) share price closed at €40.77, down from its previous close at €42.55. Its market capitalisation is €19.06 billion.
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