Connect with us

Hi, what are you looking for?

Economy

BMW profit dives, misses expectations due to weak China sales, brake issues

By Nick Carey

(Reuters) – BMW (ETR:BMWG) on Wednesday reported a 61% drop in its quarterly third-quarter profit that missed analyst expectations because of slumping China sales and brake problems, but said it was on track to meet its adjusted full-year financial outlook.

In a statement, BMW CEO Oliver Zipse said that after “extraordinary challenges in the third quarter … in the fourth quarter we are back on track for stronger earnings in order to

achieve our annual targets.”

BMW lowered its guidance for the year back in September citing sluggish Chinese demand and problems with a braking system supplied by Continental.

In October, the premium German automaker reported that its third-quarter sales in China had fallen by a third.

Rival German automakers Volkswagen (ETR:VOWG_p) and Mercedes-Benz (OTC:MBGAF) are also struggling with falling sales in China amid a weak economy and intense competition.

BMW said in September the brake issue affected over 1.5 million cars, with delivery delays expected for around 320,000 vehicles.

The company said on Wednesday it will hand those delayed vehicles to customers in the fourth quarter.

BMW posted an operating profit of 1.7 billion euros ($1.82 billion) for the third quarter, down 61% from the 4.352 billion euros in the same quarter last year. Analysts had expected an operating profit of 1.8 billion euros.

The automaker’s revenue fell 15.7% to 32.4 billion euros from 38.46 billion euros a year earlier, below analyst expectations of 34.3 billion euros.

The company said that it is still on track for a 2024 operating profit margin of between 6% and 7%. In the third quarter, BMW’s operating profit margin for its automotive segment came in at just 2.3%.

In a statement BMW chief financial officer Walter Mertl said that “with stringent management” BMW Group “remains on track” to hit its 2024 auto free cash flow target.

“In the fourth quarter, sequentially higher deliveries and a stronger product mix will support our earnings.”

($1 = 0.9179 euros)

This post appeared first on investing.com

You May Also Like

Investing

Fisker (NYSE: FSR) stock price has been one of the best-performing electric vehicle (EV) stocks this week even as Tesla slumped. The shares jumped...

Investing

Newmont (NYSE: NEM) reported mixed financial results even as the price of gold approached its all-time high. In all, the company’s earnings per share...

Investing

The Fox Corporation (NASDAQ: FOX) stock price has been under pressure as investors come to terms with the abrupt firing of Tucker Carlson. The...

Investing

NatWest (LON: NWG) share price rose sharply, helped by the strong results from Barclays. The stock jumped to a high of 274.8p, which was...




Disclaimer: Oldamericanbroker.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the-company.


Copyright © 2024 Oldamericanbroker.com