Audi’s core brand swung to an operating loss in the third quarter, and the group cut its 2026 financial forecast for the second time this year on Friday, hit by a deepening slump in China, US tariffs and price pressure in Europe.
The Audi brand lost €174 million ($195 million) at the operating level in the July-to-September quarter, against a profit of €279 million a year earlier, based on the company’s third-quarter and second-quarter updates. Its nine-month operating profit fell 40.4% to €477 million, after €651 million in the first half.
The Volkswagen-owned group now expects revenue of €55 billion to €59 billion ($61.6 billion to $66.1 billion) and an operating margin of 3% to 5%, down from €58 billion to €63 billion and 5% to 7% forecast in July, the company said in a statement.
It lowered its net cash flow forecast to €2.5 billion to €3.5 billion from €3 billion to €4 billion.
“The key figures make it clear: the need for action at Audi is high and brooks no delay,” Chief Financial Officer Jürgen Rittersberger said. “The environment deteriorated significantly again, especially in the third quarter.”
A Near-Zero Third Quarter
The Audi Group, which also includes Lamborghini, Bentley and Ducati, posted third-quarter operating profit of €29 million ($32 million), down from €468 million a year earlier, according to its quarterly update. Its return on sales shrank to 0.2% from 3.0%.
“Operating profit fell sharply to €29m due to lower revenue, while residual values and tariffs remained a burden,” the company said.
Revenue fell 18.5% to €12.9 billion ($14.4 billion), and profit after tax fell 87% to €95 million ($106 million) from €718 million, by EV’s calculation from the first-half results. Net cash flow fell 54% to €554 million.
The group’s car deliveries fell 19.6% in the quarter to 319,225 vehicles, after a 7.2% decline in the first half.
In the first half, Audi had kept operating profit slightly above the previous year, at €1.12 billion, helped by cost cuts and lower provisions for carbon dioxide compliance.
For the first nine months, revenue fell 13.1% to €42.1 billion ($47.1 billion) and operating profit fell 26% to €1.15 billion ($1.29 billion), for a margin of 2.7%, down from 3.2%. Net cash flow rose to €2.44 billion ($2.73 billion) from €2.11 billion.
Three Forecasts in Seven Months
Audi entered the year expecting revenue of €63 billion to €68 billion and an operating margin of 6% to 8%, according to its March 17 annual results. In 2025 it posted revenue of €65.5 billion and a 5.1% margin, after US tariffs cost it €1.2 billion in operating profit.
The new forecast cuts the top of the margin range by 3 percentage points from March, and the revenue midpoint by €8.5 billion. It excludes any restructuring costs beyond those agreed in 2025.
To meet even the bottom of the new range, Audi needs fourth-quarter operating profit of at least about €500 million ($560 million), against €29 million in the third quarter, by EV’s calculation.
Audi blamed “a marked deterioration in market conditions in the third quarter, particularly in China, as well as persistent competitive and price pressure on global markets.”
Rittersberger indicated that the revised forecast still points to a stronger fourth quarter, dpa reported.
The group also lowered its delivery outlook to 1.35 million to 1.45 million vehicles this year, against 1.64 million in 2025, according to its call presentation.
China and the US Drag
The Audi brand delivered 1,042,150 vehicles in the first nine months, down 11.4%. In China, including Hong Kong, deliveries fell 24.5% to 328,042, steeper than the 19.3% decline through June. Audi said the slump hit combustion-engine cars hardest, while its electric deliveries in China rose 84.7%, to 24,203.
North American deliveries, excluding Mexico, fell 17.3% to 128,749. Group deliveries in the US fell 16.3% to 111,350. Electric deliveries in North America fell 87.8% to 3,867, a drop Audi said was “mainly driven by regulatory changes in the US market.”
Europe was the bright spot. Deliveries outside Germany rose 1.3% to 360,649 and in Germany rose 1.8% to 152,011, but electric sales in Europe outside Germany fell 12.5%. Worldwide, battery-electric deliveries fell 12% to 143,748, while plug-in hybrids more than doubled, up 103%.
Electrified vehicles made up 24.4% of group deliveries, up from 18.7%.
Audi also cited growing export pressure from Chinese carmakers in Europe, higher energy costs linked to the Middle East and the switch of its entry-level lineup from the A1 and Q2 to the electric A2 e-tron.
Luxury Brands Under Pressure
Profit fell at all three of Audi’s other brands. Lamborghini raised revenue 5.1% to €2.53 billion ($2.83 billion), but its operating profit slipped to €564 million ($631 million) and its margin narrowed to 22.3% from 24.6%.
That was more than the Audi brand’s €477 million. Lamborghini accounted for 60% of the brand group’s operating profit in the first nine months, up from 38% a year earlier, the quarterly update shows.
Bentley’s operating profit more than halved to €49 million ($55 million), for a 3.5% margin, as deliveries fell 17.5% to 5,970. Ducati’s profit fell to €29 million ($32 million).
What Audi Plans
Chief Executive Officer Gernot Döllner said Audi would focus on “reducing costs and increasing quality and productivity,” while investing in new products, software, artificial intelligence and driver assistance.
“The economic situation demands that we consistently renew Audi,” he said. Audi said it would develop further measures for its German sites with the works council, building on a March 2025 agreement.
Its call presentation listed “Headcount reduction” and a “Reduction in management positions” among its measures, and kept a 2030 ambition of an 8% to 10% return on sales. Audi had 80,978 employees at the end of September.
Audi is betting on new models aimed at the US. The Q9, its first full-size SUV, goes on sale from November, and the A2 e-tron reaches European dealers in December. The RS 5, its first RS plug-in hybrid, has sold out its planned 2026 production, the company said.
Audi announced last week that it will build its first US plant in Georgia, investing about $4 billion in a factory with capacity for 200,000 SUVs a year, with production starting in the early 2030s. The plan revives a project Volkswagen put on hold in January. It has also said it has no plans to close its Mexico plant, which supplies the US market.
The call presentation described Audi’s “Lack of local footprint as a major competitive disadvantage” in the US. In a statement on October 26, Audi said its US business “is currently not profitable.”
The results follow Volkswagen Group’s third-quarter report on Thursday, when it posted an operating loss of €5.86 billion ($6.6 billion), including €7.76 billion ($8.7 billion) of special items, according to its presentation.
Volkswagen has instructed managers worldwide to plan no pay increases for its more than 660,000 employees until 2030, union IG Metall said this month, a claim the company declined to confirm or deny.
