BMW reports lower Q3 earnings as restructuring spells more pain towards end of year
BERLIN: BMW’s pre-tax earnings fell in line with expectations in the third quarter with hefty restructuring charges looming towards the end of the year, forcing another cut to its outlook as it grapples with the weak China market. The German car maker reported quarterly pre-tax earnings of €2.1 billion ($2.36 billion), falling 11% on the previous year, as forecast by analysts in a…
BERLIN: BMW's pre-tax earnings dwindled in line with predictions during the third quarter, as looming restructuring charges towards the end of the year forced another reduction in its outlook amid a struggling China market. The German automaker disclosed quarterly pre-tax earnings of €2.1 billion ($2.36 billion), a 11% drop compared to the previous year, as analysts had anticipated.
The operating margin in BMW's core automotive business contracted to 3.4%, surpassing analysts' forecast of 3.1% but a decline from 5.2% the year before.
BMW's second-quarter earnings slump was accompanied by job cuts, according to CEO Milan Nedeljkovic. He stated, "Current developments in our industry call for decisiveness and swift implementation. We will therefore specifically intensify and accelerate structural measures." The automaker had previously lowered its profit guidance for the second time in less than five months, now projecting a core operating margin of between -0.5% and 0.5% this year, a significant drop from the double-digit margins it once achieved five years ago.
The adjustment was attributed to anticipated costs in the fourth quarter stemming from a restructuring program, which includes laying off 8,000 employees in Germany. The company intends to expedite the program to reduce management functions rapidly.
Written by urgent.news from Business Recorder's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
