Porsche Stock Spikes 10% Despite Profit Warning, Ready For Shift Away From EVs
In yet another endless sign our markets are completely broken and unredeemable, Porsche stock was up 10% on Tuesday, despite the company warning about its profit for the year.
Porsche reported a 7.7% increase in sales revenue for 2023, reaching 40.53 billion euros ($44.29 billion), with its operating profit climbing by 7.6% to 7.28 billion euros, according to CNBC.
But it also announced a predicted dip in profitability for 2024 due to new model launches and challenging economic conditions, despite raising its dividend after a profitable 2023. The luxury carmaker anticipates an operating profit margin between 15% and 17%, a decrease from the 18% seen in the past two years, aiming for a long-term goal above 20%.
The company said that the forecast reflected the impact of product range updates, global economic factors, higher depreciation costs, and ongoing investments.
The company plans to introduce new versions of the Panamera, Macan, Taycan, and 911 models in 2024, it said. It was also reported yesterday that the company would be 'flexible' on any new combustion engine rules that could potentially be rolled back by the EU, per Bloomberg.
The report said the company is prepared to "steer investments back to combustion-engine cars" if the EU delays its timeline for phasing out ICE vehicles. It had previously planned to phase out ICE investments in 2026 and 2027, but Chief Financial Officer Lutz Meschke said “we are flexible to react” if the rules change.
Chairman Oliver Blume commented Tuesday: “2024 is going to be a year of product launches for Porsche – more so than any year in our history.”
He continued: “We will be introducing a variety of exhilarating sports cars to the road, they will delight our customers around the world. This will put the wind at our back for years to come.”
Meschke added: “Porsche proved in 2023 that we are resilient, highly profitable and financially robust even in volatile times. And we benefit from an even better-balanced sales structure than in the past.”
“On this basis, we’re laying the groundwork in 2024 for a flying start in 2025. Our focus remains on the sustainable success of the company. Our customers and employees, the company and our shareholders all benefit.”