Porsche's operating profit plummeted by 99%. The best-selling fuel-powered Macan is about to be discontinued.
As time goes by and the world changes, Porsche, once the most profitable luxury car brand, has disclosed its most "difficult" financial report since going public:
The company's operating profit in the first three quarters shrank by 99%, and the core automotive business has incurred a loss of 228 million euros (approximately 1.89 billion yuan).
In the third quarter, the operating loss was 966 million euros, equivalent to approximately 8 billion yuan; the net loss after tax in a single quarter was 600 million euros (approximately 4.97 billion yuan).
The CFO admitted in the earnings conference call that the company's performance has indeed entered the "darkest moment."
Surprisingly, when Porsche decided to take drastic measures, the first step it took was:
The best - selling gasoline - powered car, Macan, will be discontinued in half a year.
Porsche at the "Bottom," with a Single - Quarter Operating Loss of 8 Billion Yuan
Early sales data already hinted at the pressure on Porsche's performance:
In the first three quarters of this year, Porsche delivered 212,500 vehicles globally, a 6% year - on - year decline. However, the proportion of pure - electric vehicles has soared from 7.3% last year to 23.1%.
In terms of market structure, in the first three quarters, the sales volume in North America, the largest single market, was 64,500 vehicles, a 5% year - on - year increase.
In China, Germany, and other European regions outside Germany, there were obvious declines. The decline in the Chinese market was the most significant. In the first three quarters, the sales volume was 32,195 vehicles, a 26% year - on - year decline.
This is reflected in Porsche's latest disclosed financial report:
The company's revenue in the first three quarters was 26.864 billion euros (approximately 222.335 billion yuan), also a year - on - year decline of about 6%, consistent with the decline in sales volume.
Among them, automobile sales revenue was 23.83 billion euros (approximately 197.224 billion yuan), a year - on - year decline of 8%, accounting for about 88.71% of the company's total revenue.
The revenue in the third quarter was 8.7 billion euros (approximately 72 billion yuan), a year - on - year decline of 4.40% and a quarter - on - quarter decline of 6.37%.
However, in terms of profit, the pressure on Porsche was significantly magnified.
From January to September this year, the company's operating profit plummeted from 4.035 billion euros (approximately 33.395 billion yuan) in the same period last year to only 40 million euros (approximately 331 million yuan), a 99% year - on - year plunge.
Just in the third quarter, Porsche had an operating loss of 966 million euros, equivalent to a loss of approximately 8 billion yuan in RMB, which is equivalent to a daily loss of 86.96 million yuan.
The core business of selling cars did not make money. Instead, it had an operating loss of 228 million euros (approximately 1.887 billion yuan), while the operating profit in the same period last year was 3.771 billion euros (approximately 31.2 billion yuan).
The operating profit margin dropped to 0.2%, far lower than 14.1% in the same period last year.
The net profit after tax in the first three quarters also plunged 95.9% year - on - year, dropping to 114 million euros (approximately 943 million yuan); the net loss after tax in the third quarter was 600 million euros (approximately 4.97 billion yuan).
Fortunately, the cash flow of the automotive business has improved slightly, rising from 1.235 billion euros to 1.34 billion euros, and the cash flow profit margin has also increased from 4.8% to 5.6%.
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The performance in this financial report has further lowered Porsche's full - year performance target expectations:
Originally, it was expected that the total revenue this year would be 3.9 - 4 billion euros (approximately 32.3 - 33.1 billion yuan) with a profit margin of 10 - 12%. Now it has been lowered to revenue of 3.7 - 3.8 billion euros (approximately 30.6 - 31.45 billion yuan) and a profit margin of 0 - 2%.
The profit margin and cash flow targets for the automotive segment have also been correspondingly lowered, but the company still hopes that the proportion of pure - electric vehicles can remain at 20 - 22%.
As of the time of publication, Porsche's stock price was 47.16 euros (approximately 390 yuan), a nearly 58% decline compared to the IPO price of 82.5 euros (approximately 682.8 yuan) in 2022.
Porsche's CFO, Jochen Breckner, admitted in the earnings conference call that 2025 is expected to be the performance trough for Porsche.
However, he said that the company has further clarified its strategic direction and is now firmly implementing clear decisions. Starting from 2026, the company will see significant improvement.
How did this once - profitable luxury car brand end up in this situation?
What's Wrong with Porsche?
In the financial report, Porsche summarized several reasons for the pressure on its performance and continuous decline in profits this year:
Firstly, there were internal strategic adjustments in the company, which led to special expenses.
This is the main reason for the decline in profits, involving adjustments in two major directions: product strategy and battery business.
In terms of product strategy, as the popularization of electric vehicles was slower than expected, Porsche announced a major adjustment to its electric vehicle strategy last month -
It decided to slow down the electrification process, and will launch more fuel - powered and plug - in hybrid models in the future. It also plans to cooperate with the Volkswagen Group to redesign a new electric vehicle platform for 2030.
This part of the change resulted in additional expenses of approximately 1.7 billion euros (approximately 14.1 billion yuan), directly eroding the operating profit significantly.
In terms of battery business, Porsche acquired the battery company V4Smart under the German battery manufacturer VARTA. This adjustment also incurred additional expenses of approximately 400 million euros (approximately 3.3 billion yuan).
Secondly, Porsche's profits were also affected by external market shocks, mainly referring to the Chinese and American markets.
In China, an important market, the competition in the luxury car market has intensified, and consumer demand has been weak. The company also chose to control sales volume to "maintain value." The delivery volume in the first three quarters plunged 25.6%, further dragging down the overall revenue.
The US market was hit by increased tariffs, which directly increased costs. Coupled with inventory revaluation and an increase in provisions for after - sales spare parts, it caused a profit loss of over 500 million euros (approximately 4.1 billion yuan) for the company.
In order to stop losses in a timely manner and regain profits, Porsche is carrying out comprehensive self - rescue:
The first cost - cutting measure noticed by the outside world was personnel adjustments.
At the beginning of this year, Porsche announced that it would lay off 1,900 employees by 2029. Recently, Porsche further stated that it would cut 2,000 temporary positions within this year, and the matter is still under negotiation.
Just a few days before the release of the financial report, Porsche also announced that it would replace its CEO of ten years, Oliver Blume, no longer wanting this "dual - role CEO" to be distracted.
In order to cope with the tariff pressure in the US market, Porsche decided to raise the prices in the US market in the next few months.
In response to the pressure brought by the transformation, Porsche's latest decision is to discontinue three models, including the fuel - powered Macan, 718 Boxster, and Cayman.
It should be noted that Macan is Porsche's best - selling model. In the first three quarters, 64,800 units were sold, accounting for almost 30% of the total sales volume, with a year - on - year increase of 17.8%.
According to Porsche's CFO, the 718 Boxster and Cayman are currently producing the last few vehicles, and the fuel - powered Macan is expected to be discontinued in mid - 2026. In some markets, production may continue until 2027 depending on inventory.
Yes, the Macan will be upgraded. The second - generation Macan will offer gasoline and plug - in hybrid powertrains, be based on the all - new Audi Q5, and will be sold alongside the current all - electric Macan.
Another notable change comes from Porsche's battery business. Almost simultaneously with its external investment and acquisitions, Porsche terminated its battery self - production plan.
Since it was reported in 2023 that the company was developing a new type of solid - state battery, Porsche claimed to be confident in applying the battery to electric vehicles within a few years, with a range of up to 1,300 kilometers.
However, the reality is that the R & D progress has been slow, and the company still has a strong dependence on external suppliers. Moreover, the suppliers have not provided perfect support for Porsche.
In September 2022, there was an accident in Suzhou where a Porsche Taycan caught fire after hitting a guardrail.
In the following three years, Porsche recalled Taycan vehicles three times in October 2023, May 2024, and November 2024, all due to battery - related reasons.
To Porsche's headache, in recent days, another battery - related accident has occurred.
Adding Insult to Injury, a Pure - Electric Taycan Caught Fire
On the evening of October 24th, a Porsche Taycan in Xi'an suddenly caught fire while driving, and the car body was burned to a shell. Fortunately, the owner quickly stopped the car and got out, and no one was injured.
Porsche officially confirmed preliminarily that the vehicle did not collide, and the cause of the fire is still awaiting professional identification.
It is reported that this car is equipped with a chemical ternary lithium battery from the South Korean LG company. The battery pack is located in the chassis, and there are two capacities available in the Chinese market: 89 kWh and 105 kWh.