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01/11 03:11
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Ferrari's earnings call reflects strong financial performance and strategic growth. High EBITDA and EBIT margins, along with robust cash flow, indicate solid profitability. The strategic product development and strong order book, especially for new models like Amalfi, highlight demand strength. Despite challenges like tariffs and FX headwinds, Ferrari maintains pricing power and innovation. Guidance remains strong, with no reduction in shareholder returns. While some uncertainties exist, such as the Elettrica margin impact, overall sentiment is positive, suggesting a likely 2-8% stock price increase.
Total Revenues EUR 1.8 billion, a 7.4% growth year-over-year. The growth was driven by a richer product mix, higher personalizations, and increased sponsorships and lifestyle activities. However, there was a headwind from currency, mainly related to the U.S. dollar dynamics.
EBIT (Earnings Before Interest and Taxes) Over EUR 500 million. Strong profitability was achieved despite incremental U.S. import tariffs, foreign exchange rate headwinds, and lower deliveries of the Daytona SP3.
Industrial Free Cash Flow EUR 365 million. This was driven by increased profitability, partially offset by capital expenditures focused on product development and new infrastructure.
EBITDA Margin 37.9%. The margin remained strong despite dilution from increased import duties.
EBIT Margin 28.4%. The margin reflects the enriched product mix and increased personalization, despite challenges like U.S. import tariffs and foreign exchange headwinds.
Launch of new models: Ferrari introduced the Ferrari Amalfi, the 849 Testarossa family, and the first step of the Ferrari Elettrica reveal. The Elettrica's full unveiling is planned for 2026.
Product diversification: Ferrari plans to launch an average of 4 new models per year between 2026 and 2030, covering ICE, hybrid, and electric powertrains.
Powertrain strategy: Revised powertrain mix for 2030: 40% ICE, 40% hybrid, and 20% electric, reflecting market dynamics and client preferences.
Geographic client engagement: CEO met clients in the USA, Korea, China, and Italy, receiving positive feedback on new models and electrification strategy.
Order book: Order book extends well into 2027, with strong demand for new models like the Testarossa and Amalfi.
Revenue growth: Q3 2025 revenues reached EUR 1.8 billion, a 7.4% year-over-year growth.
Profitability: EBIT exceeded EUR 500 million, with an industrial free cash flow of EUR 365 million.
Personalization: Personalizations accounted for 20% of total revenues from cars and spare parts, particularly for high-end models.
Decarbonization commitment: Ferrari aims to reduce Scope 1 and 2 emissions by 10x and Scope 3 emissions by 25% by 2030 compared to 2021 and 2024 levels, respectively.
Lifestyle and brand expansion: Ferrari is enhancing client experiences and broadening its audience through lifestyle activities and brand consistency.
Macroeconomic Environment: The macroeconomic environment remains uncertain and extremely volatile, which could impact the company's ability to achieve its ambitious growth plans.
U.S. Import Tariffs: Incremental U.S. import tariffs have created a margin dilution, particularly visible in Q3, affecting profitability.
Foreign Exchange Rate Headwinds: Greater foreign exchange rate headwinds, particularly related to the U.S. dollar, have negatively impacted revenues and profitability.
Model Changeover: The significant changeover of models, with 35% of the lineup in ramp-up phase by year-end, could pose operational challenges and impact deliveries in the short term.
Electrification Strategy: The recalibration of the powertrain offering to include 40% ICE, 40% hybrid, and 20% electric reflects slower-than-anticipated market adoption of electric vehicles, which could impact long-term strategic goals.
Racing and Brand Investments: Higher expenses in racing and brand investments have increased SG&A costs, potentially impacting margins.
Scope 3 Emissions Reduction: The target to reduce Scope 3 emissions by 25% by 2030 versus 2024 presents a significant challenge, requiring substantial investment and operational adjustments.
Revenue Expectations: Ferrari projects EUR 9 billion in revenues by the end of the decade, with a 40% EBITDA margin and 30% EBIT margin.
Product Launches and Powertrain Strategy: Ferrari plans to launch an average of 4 new models per year between 2026 and 2030, with a recalibrated powertrain mix of 40% ICE, 40% hybrid, and 20% electric, reflecting market dynamics and client preferences.
Decarbonization Goals: Ferrari aims to reduce Scope 1 and Scope 2 emissions by 10x by 2030 compared to 2021 levels and decrease Scope 3 emissions by 25% by 2030 compared to 2024 levels.
Future Model Lineup and Order Book: Ferrari's order book extends well into 2027, with significant model changeovers planned, including the introduction of the 849 Testarossa family, Amalfi, and the 296 special series.
Ferrari Elettrica Development: The Ferrari Elettrica will be revealed in stages, with the interior design concept in Q1 2026 and the complete car in Q2 2026, emphasizing innovation and driving emotion.
2025 Guidance and Profitability: Ferrari revised its 2025 guidance upwards, exceeding profitability targets set for 2026, with strong confidence in future performance.
2026 and Beyond: The introduction of the F80 model will be gradual, with a life cycle of around 3 years, contributing to a back-end loaded 2026 and shaping product and country mix.
share repurchase program: The decision to complete the current share repurchase program within this year, one year earlier than planned, reflects the company's strong progress and confidence in the future. The share repurchase program was executed in the quarter and is approaching its completion by year-end, as announced in June 2022.
Ferrari's earnings call reflects strong financial performance and strategic growth. High EBITDA and EBIT margins, along with robust cash flow, indicate solid profitability. The strategic product development and strong order book, especially for new models like Amalfi, highlight demand strength. Despite challenges like tariffs and FX headwinds, Ferrari maintains pricing power and innovation. Guidance remains strong, with no reduction in shareholder returns. While some uncertainties exist, such as the Elettrica margin impact, overall sentiment is positive, suggesting a likely 2-8% stock price increase.
The earnings call summary shows strong financial performance with growing revenues, high EBITDA, and effective cost management. Although there are concerns about U.S. tariffs, the guidance remains optimistic, and no program delays are reported. The Q&A highlights strong demand for new models and positive market strategies, despite some pressure on residual values. The overall sentiment is positive, driven by strong earnings, optimistic guidance, and a commitment to sustainability and innovation.
The earnings call summary reveals strong financial performance with increased revenues, EBITDA, and net profit. The new model launches and sponsorship growth are promising, while the dividend distribution and share purchase program indicate shareholder confidence. Despite some risks like exchange rates and supply chain challenges, the company's hedging and strategic initiatives mitigate these concerns. The Q&A section supports the positive sentiment with no significant negative trends observed. Overall, the positive financial results, strategic growth plans, and shareholder returns suggest a positive stock price movement over the next two weeks.
Ferrari's earnings call highlights strong financial performance, including double-digit revenue growth and increased net profit. The launch of six new models, including an electric one, and significant progress towards carbon neutrality are positive indicators. Shareholder returns through dividends and repurchases further boost sentiment. While competitive pressures and supply chain challenges exist, Ferrari's strategic initiatives and optimistic outlook, particularly in personalization and sponsorship growth, outweigh these risks. The Q&A session reinforced confidence in margin expansion and price increases, supporting a positive sentiment.
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