Porsche has significantly adjusted its forecast for the current fiscal year, announcing a downward revision on April 28, 2025, that has left investors concerned. Citing various special effects impacting its finances, the renowned car manufacturer now expects revenues between 37 and 38 billion euros, a notable drop from the previous target of 39 to 40 billion euros.
The Management Board has also revised its expectations for the operating return on sales, now estimating it to be only 6.5 to 8.5 percent, down from the earlier forecast of 10.0 to 12.0 percent. The news is disappointing for stakeholders, as the net cash flow margin for automobiles is now projected to be just 4.0 to 6.0 percent, a decline from the previously anticipated 7.0 to 9.0 percent.
Furthermore, the EBITDA margin for automobiles has been scaled back from an expected 19.0 to 21.0 percent to a new range of 16.5 to 18.5 percent. This series of adjustments reflects the challenging environment Porsche is navigating, particularly in the realm of electromobility.
In light of the "slower ramp-up of electromobility," Porsche has decided to strategically realign its battery activities. The company announced that plans to expand the production of high-performance batteries through its wholly-owned subsidiary, Cellforce Group GmbH, will not be pursued independently. This decision is expected to result in an increase in special expenses for the fiscal year 2025, which will rise from 0.8 billion euros to 1.3 billion euros.
Adding to Porsche's challenges is the situation in the crucial Chinese market, where conditions remain "challenging" and demand for luxury electric vehicles is declining. The company is also facing additional costs in the supplier sector, which further complicates its operational landscape.
Moreover, the erratic U.S. tariff policy has introduced an element of uncertainty for Porsche, affecting its broader strategic planning. Following the announcement of these significant adjustments, the DAX-listed shares of Porsche fell again, reflecting investor disappointment. The stock has been under pressure, requiring shareholders to maintain a long-term perspective and resilience.
In a related analysis, Jefferies & Company Inc. assessed the Porsche share on April 29, 2025. The financial services firm has maintained its rating for Porsche AG at "Hold," with a price target set at 49 euros. Analyst Philippe Houchois noted that the quarterly results are now less relevant following the downward adjustment of annual targets the previous evening.
During the XETRA session on April 29, Porsche's stock experienced a decline of 6.2 percent, trading at 44.00 EUR at 12:03 PM. Despite this drop, the stock still holds a potential upside of 11.36 percent compared to the established price target. The daily turnover for Porsche shares reached 1,138,841 shares, indicating active trading even amid the downturn.
Since the beginning of 2025, the stock has seen a significant decrease of 24.7 percent, which has raised concerns among investors about the company’s future performance. The presentation of the Q1 2025 financial results is scheduled for later today, adding another layer of anticipation to the unfolding situation.
With the automotive industry facing rapid changes, particularly in the transition to electric vehicles, Porsche's strategic decisions will be closely scrutinized. The company's ability to navigate these challenges will be crucial as it seeks to maintain its status as a leading luxury car manufacturer.
Overall, the adjustments to Porsche’s financial outlook signal a difficult path ahead, particularly in light of external market pressures and internal operational challenges. Investors and analysts alike will be watching closely to see how Porsche adapts its strategies in response to these developments and whether it can regain momentum in a competitive market.
