Third-quarter deliveries of around 1,430 vehicles have come in below the 1,641 expected. That was driven by weaker demand in both the North America and the Asia Pacific regions.
Management called out the ongoing impact of US tariffs and lower sales of higher-margin ‘Special’ models.
Full-year underlying operating losses are now expected to be worse than the £110mn that markets had been forecasting. Free cash flow is no longer expected to be positive over the second half, though an improvement in the fourth quarter is expected.
An immediate review of costs and capital expenditures is underway, with 2026 performance expected to show improvements.
The shares fell 7.3% in early trading.
Our view
Aston Martin’s struggles deepened as full-year guidance was cut yet again, with management warning that hopes of turning a profit have been pushed firmly into 2026. The outlook for free cashflow, once tipped to turn positive in the second half, have deteriorated further, adding pressure to an already stretched balance sheet.
The second half was meant to bring relief, driven by deliveries of the high-priced Valhalla supercar. But the ramp-up is now slower than planned, adding further pressure on the fourth quarter to do some heavy lifting.
In the meantime, Aston Martin continues to burn through cash. Asset sales raised $108mn over the quarter to help shore up the balance sheet. That’s helping provide a short-term buffer, but it’s not a viable longer-term plan.
We also see scope for tariffs to cause further pain. The current regime allows the first 25,000 UK cars to be exported to the US each quarter to be subject to a basic tariff of 10%, on a first-come, first-served basis. Anything over that in each quarter will be subject to a much higher tariff of 27.5%. Given the lack of control, and the fact a third of Aston Martin’s revenue comes from the US, this is a significant trip hazard.
The current high level of debt and the associated financing costs are also a big problem. Double-digit interest rates show that lenders need to be compensated heavily for the high level of risk they’re taking on.
To make matters worse, the group still isn’t generating positive cash flows. That could spell real trouble if it runs out of funds to meet these obligations. As a reminder, debt investors are in the driving seat when it comes to claims on assets if Aston Martin fails to meet scheduled debt payments.
Given the group’s lack of scale (it made only 6,030 cars last year) even a small dip in volumes can have a big negative impact on profits and vice versa. Returning to profitability will require Aston Martin to grow volumes again, benefitting from the improved efficiencies that greater scale brings.
If management can deliver the expected improvements next year, there could be upside on offer. However, we’re quite concerned given the recent tariffs, struggling demand, and high rate of cash burn, and see scope for 2026 profit expectations to drop from here.
Environmental, social and governance (ESG) risk
Most of the auto industry falls into the medium risk category in terms of ESG. Product governance, particularly around safety, and the carbon emissions from companies’ products and services are key risk drivers. Business ethics, labour relations and operational carbon emissions are also contributors to ESG risk.
According to Sustainalytics, Aston Martin’s management of ESG risks is strong.
ESG issues are overseen by the board and overall disclosure is strong. There’s a robust environmental policy in place, with a commitment to net zero for scope 1 and 2 emissions by 2030 and scope 3 emissions by 2039 and has interim targets in place. However, AML doesn’t divulge sustainability-linked revenue and environmental impact isn’t systematically considered in the design phase. Although some of AML’s facilities are externally certified, scope is unclear and its product and safety programme needs improvement.
Aston Martin key facts
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This article is original Hargreaves Lansdown content, published by Hargreaves Lansdown. It was correct as at the date of publication, and our views may have changed since then. Unless otherwise stated estimates, including prospective yields, are a consensus of analyst forecasts provided by LSEG. These estimates are not a reliable indicator of future performance. Yields are variable and not guaranteed. Investments rise and fall in value so investors could make a loss.
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