#Sweden #Gothenburg #Volvo Group #Q1 2025 #Net Sales

Volvo Group's Q1 2025 Performance Report

In the first quarter of 2025, the Volvo Group experienced a notable decline in net sales, recording a 7% decrease when adjusted for currency fluctuations. The total net sales for this period amounted to SEK 121.8 billion compared to SEK 131.2 billion in the same quarter the previous year. This downturn can be attributed significantly to the reduced demand for vehicles, which saw a 9% decrease from Q1 2024.

During the quarterly report, CEO Martin Lundstedt highlighted that growing uncertainties surrounding trade tariffs are impacting market stability. These tariffs have created an environment of hesitation among buyers, leading to decreased vehicle orders and consequently, lower overall sales volumes.

Despite the challenges in vehicle sales, Lundstedt noted a silver lining: the underlying service business continued to thrive. This sector grew by 2%, excluding the effects of the divestment of Arquus and currency adjustments, supported by strong utilization rates of vehicles and machinery across various global markets. Over the rolling 12 months, service revenues reached SEK 129.2 billion, showcasing resilience in Volvo’s service model.

However, the diminished vehicle volumes did affect profitability. The operating income for the quarter stood at SEK 13.3 billion, compared to SEK 18.2 billion in the previous year. The operating margin also reflected this decline, dropping from 13.8% to 10.9%. Currency fluctuations further compounded these challenges, stripping SEK 207 million from the operating income.

When it comes to earnings per share, the figures showed a stark difference year-over-year, falling to SEK 4.86 from SEK 6.92. Operating cash flow also saw a significant decrease, dropping from SEK 8,896 million to SEK 1,309 million in the Industrial Operations segment. Meanwhile, the return on capital employed decreased to 31.8% from 37.7%.

To provide further insights and discuss the implications of these results, the Volvo Group will host an online press and analyst conference call at 0900 CEST on April 23, 2025. Interested participants can join via the provided webcast link and gain access to a deeper analysis as well as a Q&A session with Lundstedt.

Conclusion

In summary, while the Volvo Group's Q1 2025 results reflect significant challenges, especially in vehicle sales amidst pressing global trade uncertainties, the company maintains a strong foundation in its service offerings. The ability to adapt and respond to market conditions will be crucial moving forward, as the Group continues to navigate these complex external factors. As Volvo looks ahead, it remains committed to enhancing its service segment and addressing the factors affecting its vehicle sales to ensure sustained growth and resilience in a changing marketplace.

For more detailed information and updates, visit the Volvo Group Investor Relations page.