Continental AG expects earnings growth but lower sales in 2026

(Sharecast News) - German tyremaker and automotive parts group Continental AG raised its dividend and guided to higher profits in 2026, but warned of a further decline in sales after reported a 2.0% drop in turnover for last year.

The company reported consolidated sales of �19.7bn for 2025, down from �20.1bn the year before, though an 0.8% improvement on an organic basis.

Adjusted earnings before interest and tax also fell 8.0% to �2.0bn, with the adjusted EBIT margin slipping to 10.3% from 11.0%. The board proposed a dividend of �2.70 per share, up from �2.50 paid out in 2024.

Continental AG said the tariff hit in 2025 was �100m, while exchange rate movements also had an impact on the bottom line.

"Without these additional burdens, earnings in the Tires group sector would have been significantly higher than in the previous year," said chief financial officer Roland Welzbacher.

"These challenges will not go away this year. However, thanks to the measures we've taken, our operational strength, our excellent products and our strong brand, we're aiming to increase earnings in 2026 despite the difficult environment."

For 2026, despite a "continued volatile environment", Continental said profitability is expected to improve due to the anticipated strong growth in 18-inch-plus premium tyres, falling raw material prices and a recovery in industrial markets in the second half.

Consolidated sales are expected to fall to between �17.3bn and �18.9bn. While the adjusted EBIT margin should grow to between 11.0% and 12.5%, the midpoint implies EBIT of �2.13bn, short of the current consensus forecast of �2.20bn.

Continental AG shares were down 0.6% at �66.84 by 1013 GMT.