Volkswagen delivers profit warning after €10bn write-down

(Sharecast News) - Volkswagen shares fell on Monday after the German auto giant reported �10bn in one-off impairment charges, including a significant write-off relating to its investment in Porsche AG, causing management to downgrade profit assumptions for the full year.

The carmaker said late on Friday that operating return on sales is now expected to be "up to 1%", down from 2.8% in 2025 and well below the previous forecast of 4.0-5.5%. The current consensus forecast is around 4.1%. Excluding write-offs, operating return on sales would be closer to 4%, it said.

Of the �10bn in "special effects" expected to hit 2026 results, �0.9bn have been reported for the first half.

The write-down related to Porsche AG totals �6bn as the luxury car manufacturer struggles with collapsing sales in China and weaker long-term growth expectations.

Meanwhile, Volkswagen said it was booking additional restructuring expenses from the expansion of early retirement schemes and the planned sale of Volkswagen Osnabrück. Along with its own write-down linked to the Chinese auto market, these three factors combined amount to impairments of �2bn.

Group sales revenue is tipped to be �315bn, more or less the midpoint of previous guidance of -3% to 0% compared with last year's �321.9bn.

However, the company said that the board "will decide on the proposal of the dividend for the 2026 financial year" at its AGM in early 2027. The dividend was scheduled to be paid out in June 2027.

The stock was 1.4% lower at �75.42 by 1125 BST, taking its year-to-date decline to 29%.