Porsche AG Realigns Strategy Amid Tough H1 2025 Results
Porsche AG pushes ahead with a comprehensive strategic realignment to counter persistent macroeconomic and geopolitical headwinds. In the first half of 2025, the sports car maker posted group sales revenue of €18.16 billion and operating profit of €1.01 billion, equating to a 5.5 per cent operating return on sales. These H1 2025 results reflect weaker demand in key markets and extraordinary items tied to its strategy shift. CEO Oliver Blume says: “The world is changing dramatically. That's why we are fundamentally developing Porsche. Our customers will very much appreciate our completely revamped product range. We therefore expect that we will begin to see positive momentum again from 2026 onwards.”
Blume identifies three pressures shaping the outlook: “In China, demand in the premium and luxury segment has fallen sharply. In the US, import tariffs are also putting huge pressure on our business. Looking ahead, the movement of the dollar could also have an impact. In addition, the transformation to electric mobility is progressing more slowly than expected overall, with consequences for the supplier network.” Porsche responds by rescaling operations and building a more flexible product portfolio. Special charges total roughly €1.1 billion in H1, including about €200 million for the realignment, €500 million for battery activities and a €400 million burden from US tariffs, after Porsche offered customers price protection.
CFO Dr Jochen Breckner underlines the aim: “Our strategic realignment aims to strengthen our profitability and resilience.” In the second half of the year, Porsche will open negotiations with employee representatives on a second package of measures. “To make Porsche fit for the future, we will discuss far-reaching approaches,” says Breckner. “These measures are expected to have a positive impact on earnings and cash flow in the coming years.”
Automotive net cash flow stood at €394 million, with a 2.4 per cent automotive net cash flow margin. Porsche delivered 146,391 vehicles worldwide in H1 2025; 36.1 per cent of these were electrified, split into 23.5 per cent all-electric and 12.6 per cent plug-in hybrids. In Europe, electrified vehicles accounted for around 57 per cent, exceeding the target set at the IPO. The Macan led the lineup with 45,137 global deliveries. Porsche set new delivery records in North America and the Overseas and Emerging Markets. “We will continue to manage supply and demand in close coordination with our sales regions by our 'value over volume' strategy. This is based on our beautiful product range and the strength of our brand,” says Breckner. “We are also seeing positive momentum from our individualisation offerings.”
Porsche advances battery cell production through its subsidiary V4Smart GmbH. A few months after founding the company, V4Smart ramped up a second production line in Nördlingen as planned. Together with the Ellwangen line, it currently operates Europe’s only production facility for high-performance lithium-ion round cells, supporting the brand’s electric vehicle roadmap and supply chain resilience.
Quality and sport continue to enhance brand equity. In the latest J.D. Power APEAL study in the US, Porsche ranked first among all manufacturers in customer perception. On track, the marque took a double triumph at the Formula E season finale in London, securing world championship titles in both the team and manufacturer standings. At Le Mans, Porsche celebrated a second consecutive LMGT3 class victory with the 911 GT3 R, while the Porsche 963 claimed second overall after a gripping finish.
Porsche has adjusted its 2025 forecast following the EU Commission’s agreement with the US government on import tariffs. The updated outlook reflects expected 15 per cent import tariffs from 1 August and potential countermeasures such as price adjustments to mitigate the impact. Porsche still expects group sales revenue between €37 billion and €38 billion. At the lower end, it anticipates a 5 per cent group return on sales and a 3 per cent automotive net cashflow margin; at the upper end, a 7 per cent group return on sales and a 5 per cent automotive net cashflow margin, in line with guidance from late April—the forecast also factors in expected special effects of around €1.3 billion related to the strategic realignment.
Compared with H1 2024, sales revenue fell 6.7 per cent from €19.46 billion to €18.16 billion. Operating profit declined 67.0 per cent from €3.06 billion to €1.01 billion, and the operating return on sales moved from 15.7 per cent to 5.5 per cent. Deliveries decreased 6.1 per cent from 155,945 to 146,391. Porsche continues to realign its strategy to protect profitability, strengthen cash flow, and sustain innovation across electric vehicles, battery technology and its core performance car range.