Volkswagen (VWAGY) cut its full-year revenue outlook on Friday, claiming the environment for the auto industry as a whole was “extremely challenging.” The world’s second-largest carmaker now expects 2026 sales revenue to be flat or down 3% compared to last year, down from a…
ior forecast of flat to 3% growth. It held its operating-margin target at 4.0% to 5.5% and left net cash flow and liquidity guidance unchanged
The reset came alongside a mixed second quarter. Group sales revenue rose 2.0% to €82.4 billion ($93.9 billion) — but that gain was driven by its financial services division and higher pricing. Vehicle sales fell 9.7% to 2.04 million units, and production dropped 13.4% to 2.01 million.
VW’s operating result (similar to EBIT) fell 9.5% to €3.47 billion ($3.96 billion), with operating margin falling to 4.2% from 4.7% a year ago. “Applying disciplined cost management, we have managed to offset continued unavoidable headwinds in the double-digit billions,” CEO Oliver Blume said in a statement. “At the same time, the environment for the automotive industry remains extremely challenging: geopolitical crises, trade conflicts, high regulatory requirements, volatile markets and intensified competition.” Automotive net cash flow swung to a positive €1.17 billion ($1.33 billion) in the quarter, from an outflow of €523 million ($596 million) a year earlier, but it was mostly the result of lower investment, reduced tax payments, and working-capital timing. China continues to be a worrying trend for VW. While overall group deliveries fell 8.6% worldwide in the quarter, China sales plunged 36.6% to 424,300 vehicles, against gains of 7.7% in North America, 9.4% in South America, and 2.5% in Europe.