Unable to keep up in sales, Porsche is now at least trying to take remedial action. The 2025 data, after all, are harsh. Annual revenue fell by 9.5% to 36.27 billion, with the automotive segment sharply down 11.7% to 32.2 billion.
PORSCHE’S TOUGH 2025
Deliveries of Zuffenhausen’s sports cars decreased by 10.1% to 279,400 units, losing ground especially in China (-26 percent) where consumers have shown that they do not only turn to domestic cars for city cars and sedans, but also for higher segment vehicles. The Dragon’s competition, in short, is now in every sector.
The operating profit has effectively crumbled: a 92.7% collapse, landing at just 410 million from 5.64 billion in 2024 due to 3.9 billion in one-off charges. Of these, 2.4 billion relate to the “realignment of product strategy and company downsizing,” 700 million to charges linked to the revision of battery programs, and a further 700 million to US tariffs.
Consequently, the operating margin dropped from 14.1% to 1.1%, thus moving away from the historical average around 15%, which for years had assigned Porsche the role of queen of Western manufacturers in terms of profitability. Finally, net profit fell from 3.6 billion to 310 million.
THE STRATEGY TO RESTART
Cash flows from automotive activities more than halved, dropping from 3.73 billion to 1.51 billion. At the next shareholders’ meeting, a dividend of 1 euro per ordinary share will be proposed, down from 2.3 euros paid last year.
While rumors of heavy cuts on the electrification front of the range are circulating, the new CEO, Michael Leiters, who succeeded Oliver Blume under pressure from investors who asked the former CEO to focus on just one brand, since the top manager also leads the Volkswagen group, announced a cost-cutting plan that includes cutting managerial levels, simplifying hierarchies, and also reducing investments. “We have to make tough decisions to address an inflated cost structure,” Leiters admitted, emphasizing the need to return to generating cash with operating margins.
CUTS IN CHINA AND PERSONNEL
To support margins, Porsche is considering new models positioned above the 911 and Cayenne, while continuing discussions with worker representatives on further savings measures that will likely go beyond the planned cut of about 3,900 jobs by 2030, including 2,000 temporary workers, out of a workforce of about 40,000 employees. Cuts also in China where, faced with stalled sales, the German sports car maker is downsizing its dealer network and has also decided to get rid of 200 electric vehicle charging points in the Dragon.
