Porsche AG: Massive Operating Losses and Strategic Reorientation in the Face of Market Challenges

Porsche expects to record losses of around one billion euros

Luxury sports car manufacturer Porsche AG is facing significant financial difficulties, according to its latest financial reports, signaling a difficult year for 2025. The company reported a dramatic drop in operating profit and even a quarterly operating loss, as a result of extraordinary costs related to a major strategic reorientation, especially regarding its electric vehicle (EV) plans and the challenges of the Chinese market.

Operating Profit Collapses

Financial data for the first nine months of 2025 paint a worrying picture for Porsche AG:

• Operating Profit: This fell by 99% compared to the same period in 2024, reaching just 40 million euros, compared to 4.035 billion euros in the previous year.
• Quarterly Operating Loss: In the third quarter (Q3) of 2025, Porsche AG recorded an operating loss of 967 million euros, a sharp change from the profit of 974 million euros in Q3 2024. This loss was larger than analysts had expected.
• Sales Revenue and Deliveries: Sales revenue fell by 6.0% to 26.86 billion euros, while deliveries to customers also fell by 6.0%.

The steep decline is mainly attributed to extraordinary costs associated with the company's decision to review its product portfolio and electrification strategy.

Strategic Reorientation and Impact on EVs

Porsche management blamed the poor results on the costs of remodeling the product portfolio and a partial return to gasoline (combustion) models in response to weaker-than-expected demand in the EV segment.

Key Measures:

1. EV Launch Delays: Porsche decided to delay the introduction of fully electric models and extend the life of some models with combustion engines and plug-in hybrids.
2. Project Cancellations: The company dropped plans for a fully electric SUV above the Cayenne and canceled battery production plans.
3. Target Adjustments: The medium-term sales operating profitability target was also reduced.

CFO Jochen Breckner stressed that these strategic reorientation measures are essential, but had an impact of about 1.8 billion euros on operating profit. The company expects 2025 to be the lowest point before a noticeable improvement in 2026.

External Challenges: China and Tariffs

In addition to the internal reorientation, Porsche also faces significant external pressures:

• China Market: The manufacturer is facing intense competition in the Chinese market, one of its most important markets, contributing to the decline in sales.
• US Tariffs: Trade tariff issues, especially the threat of tariffs from the United States, have generated costs of more than 500 million euros to date.

Despite these challenges, Porsche remains optimistic, counting on a robust financial structure and a newly revised product portfolio (including the new electric Macan and Taycan, as well as the 911 models), which will lay the foundation for a comeback and increased financial resilience in the medium and long term.