Ferrari N.V. (RACE) Q2 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call summary shows strong financial performance with growing revenues, high EBITDA, and effective cost management. Although there are concerns about U.S. tariffs, the guidance remains optimistic, and no program delays are reported. The Q&A highlights strong demand for new models and positive market strategies, despite some pressure on residual values. The overall sentiment is positive, driven by strong earnings, optimistic guidance, and a commitment to sustainability and innovation.
Key Financial Performance
Total Revenues EUR 1.8 billion, a 4.4% growth year-over-year. The growth was driven by a richer product and country mix, as well as higher personalizations.
EBITDA In excess of EUR 700 million. The strong profitability was supported by enriched product mix and increased personalization.
Industrial Cash Flow EUR 230 million. This reflects increased profitability, partially offset by negative changes in working capital provisions and higher inventory in line with the production plan.
EBITDA Margin 39.7%. This was supported by flat D&A determined by the model changeover and enriched product mix.
EBIT Margin Close to 31%. This was driven by enriched product mix, increased personalization, and positive country mix.
Net Industrial Debt EUR 338 million at the end of June 2025. This reflects dividend payments and seasonal tax payments.
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Operating Highlights
Ferrari Elettrica: On track with product development, upcoming launch, and excitement after recent test drive on the race track.
Ferrari Amalfi: Introduced as the 11th model in the 15-model roadmap, launched in July 2025. Initial order collection stage with high demand.
296 Speciale and Speciale Aperta: Two special series launched earlier in 2025, with significant demand nearing full coverage of their life cycles.
296 GT3 Evo: New race car presented in June 2025, set to debut in the 2026 season.
Ferrari Hypersail: Revolutionary boat under construction, representing a new sporting challenge in sailing with technological transfer between sports car and nautical sectors.
Ferrari Amalfi launch event: Hosted over 1,500 guests on the Amalfi Coast, achieving unprecedented client engagement and brand visibility. Aimed at nurturing existing clients and attracting new ones.
Geographic allocation strategy: Deliberate allocation strategy reflected in geographic breakdown of shipments, adapting to product cycles.
Production ramp-up: Progressing on e-building and new paint shop construction, with equipment installation underway.
New track construction: Started construction of a new track near facilities for enhanced sports car testing.
Personalization revenue: Personalizations accounted for approximately 20% of total revenues from cars and spare parts, driven by models like Daytona SP3 and SF90 XX family.
Focus on quality over volume: Deliberate reduction in deliveries for the rest of 2025 to prioritize quality of revenues over volume.
Racing achievements: Secured third consecutive win at 24 Hours of Le Mans, retaining the winners' trophy permanently. Progress in Formula 1 with recent podiums and wins.
Share repurchase program: Resuming multiyear share repurchase program of EUR 2 billion, aiming for completion by year-end.
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Risk or Challenges
Macroeconomic Environment: Uncertain macroeconomic conditions, ongoing geopolitical tensions, and market volatility pose risks to Ferrari's operations and financial performance. These factors require increased cautiousness and adaptability.
Trade Tensions and Tariffs: Incremental tariffs in the U.S. could impact profitability, although Ferrari has managed to mitigate this in the short term by leveraging existing inventory.
Currency Fluctuations: Negative impacts from currency fluctuations, particularly related to the U.S. dollar, could affect revenues and profitability.
Product Complexity and Launches: The high number of new model launches and technological advancements require effective management of complexity and agility, which could strain resources and operational efficiency.
Supply Chain and Inventory Management: Higher inventory levels in line with production plans could pose risks if demand fluctuates or supply chain disruptions occur.
Racing and Brand Investments: Increased expenses related to racing activities and brand investments could pressure margins, especially if returns on these investments are not realized as expected.
Regulatory and Environmental Compliance: Potential regulatory changes, including environmental provisions, could increase costs and operational challenges.
FX Headwinds: Greater headwinds from foreign exchange rates, particularly the weakening U.S. dollar against the euro, are anticipated to impact the second half of 2025.
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Guidance & Outlook
Product Development: Ferrari is on track with the development of the Ferrari Elettrica, with an upcoming launch planned. The company also introduced the Ferrari Amalfi, the 11th model in its 15-model roadmap, and plans to launch additional models in the future.
Order Book and Demand: Ferrari has a strong order book extending into 2027, with current production models substantially sold out. The newly launched Ferrari Amalfi is in the initial order collection stage, and demand for the 296 Speciale family is nearing full coverage of its lifecycle.
Production and Facilities: The production ramp-up of Ferrari's e-building is proceeding as planned. Construction of a new paint shop is underway, with equipment installation about to begin. Additionally, a new track for sports car testing is being constructed to enhance product testing accuracy.
Financial Guidance for 2025: Ferrari confirmed its 2025 guidance with stronger confidence across all metrics. The company removed a 50 basis point risk on percentage margins due to a recent agreement on U.S. tariffs and expects lower industrial costs in the second half of the year. Deliveries for the rest of 2025 are expected to be deliberately reduced compared to 2024 to prioritize quality of revenues over volume.
Revenue and Profitability: Ferrari anticipates a softer product mix in the second half of 2025 due to the phaseout of the Daytona SP3 and the introduction of the F80. Higher SG&A expenses are expected due to planned corporate and commercial activities, along with higher D&A costs linked to new model production. FX headwinds are anticipated if the U.S. dollar remains weak against the euro.
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Shareholder Return Plan
Dividend Payment: The company paid dividends at the beginning of May.
Share Repurchase Program: Ferrari has a multiyear share repurchase program of EUR 2 billion. The company intends to resume repurchases and aims to complete the program by year-end.
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Key Q&A
Q:Could you comment on residual value developments in key markets?
A:Residual value in the U.K. was under pressure, but actions taken are showing good trends. In the U.S., some models are under pressure, but no major concerns were noted.
Q:Why are industrial costs in the second half expected to be lower than originally expected?
A:Lower industrial costs are due to easier comparisons with last year, reduced quality costs, and better-than-expected supply chain costs due to lower inflation.
Q:Why is there a change in the R&D capitalization versus amortization, leading to a lower benefit in the second quarter?
A:The change is due to the overlap of projects and the pace of development for both Formula 1 and World Endurance Championship cars.
Q:Does the reduction in industrial cost reflect postponements or delays to any programs?
A:No, there are no postponements or delays to any programs.
Q:Why was cars and spare parts growth at 3%, which is lower than usual?
A:The 3% growth is due to the development of the product mix based on plans. Personalization penetration remains strong at 20%.
Q:Why was the gross margin extremely strong despite weaker-than-expected ASP?
A:The strong gross margin is attributed to better efficiency, lower inflation, and reduced costs in both sports car and racing activities.
Q:How will the U.S. tariff changes affect pricing and client experience?
A:The commercial policy will not change until the new 15% tariff is implemented. Clients will see tariffs itemized separately on invoices.
Q:What is the positioning strategy for the Elettrica, Ferrari's first all-electric vehicle?
A:The Elettrica is designed for both existing Ferrari enthusiasts and new customers. More details will be revealed in October.
Q:Do changes in CO2 emission regulations impact Ferrari's product rollouts?
A:Ferrari focuses on its own strategy and adapts to external regulations with agility. The company views regulatory changes as opportunities to innovate.
Q:What is the aim of the Amalfi model?
A:The Amalfi aims to improve Ferrari's offering in markets like China and attract new customers from other brands.
Q:What is the demand pattern for the 296 Speciale?
A:Demand for the 296 Speciale is strong globally, with no specific regional patterns.
Q:What models are gaining traction in China, given the tax impact on Dodici Cilindri?
A:Models like the Amalfi, which are more suitable for the Chinese market, are gaining traction.
Q:Why was the share of hybrids in the quarter the lowest in years?
A:The share of hybrids depends on the product mix and the volume of hybrid models like the 296 Speciale, which has a lower volume than the 296.
Q:Why was the 50 bps cautious element removed from the guidance?
A:The removal is due to lower-than-expected industrial costs and better supply chain conditions.
Q:Why was the 'other' line in the EBIT bridge higher than usual?
A:The 'other' line was higher due to new sponsors and better contributions from Formula 1 commercial rights.
Q:Is there a delay in the launch of Ferrari's second electric vehicle?
A:No, the first electric vehicle is on track for a Q4 2025 unveiling, as previously announced.
Q:Have U.S. tariffs led to client cancellations or postponements?
A:No specific cancellations or postponements due to tariffs have been observed.
Q:What is the shipment status of the Daytona SP3?
A:60 units were shipped in Q2, and approximately 40 units are expected in Q3.
Q:What should be expected at the upcoming Capital Markets Day?
A:Ferrari will disclose its marketing, product, and financial strategies, along with its business plan for the next five years.
Q:Review of Unclear Management Responses
A:Management avoided providing specific details about the Elettrica's positioning strategy, stating that more information would be revealed in October. Additionally, they did not disclose exact pricing strategies for upcoming launches, citing the need to inform dealers first.
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Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
Bank
Co
Coast
EUR
GT Evo
Markets Research
Racing
Research Division
Russo Head
SF XX
Shipments
Speciale
Today group
World Premiere
XX family
agility
car testing
challenge
changeover
construction
cycle
discipline
effort
family contribution
focus
market volatility
offering
phaseout
product excellence
production
project
race
ramp
relation
repurchase program
season
technology advancement
track
world
RACE Transcript
Ferrari N.V. (RACE) Q1 2026 Earnings Call Transcript
Positive5-5
The earnings call summary reveals strong financial performance with significant year-over-year increases in revenue, net profit, EBITDA, and free cash flow. These positive metrics indicate robust demand and effective cost management. Despite the mention of potential regulatory challenges, the overall financial health and growth trajectory suggest a positive market reaction. The lack of negative sentiment in the Q&A further supports this outlook.
Ferrari N.V. (RACE) Q4 2025 Earnings Call Transcript
Positive2-10
The earnings call highlights strong financial performance with promising future guidance, including increased profitability targets for 2025 and a robust order book extending to 2027. Despite some concerns about FX impacts and vague management responses, the strategic product launches, particularly the Ferrari Elettrica, and the positive reception of new models like Amalfi, suggest growth potential. The Q&A indicates confidence in offsetting cost increases with mix and pricing strategies. Overall, these factors, alongside the positive market sentiment towards future developments, point to a positive stock price movement.
Ferrari N.V. (RACE) Q3 2025 Earnings Call Transcript
Positive11-4
Ferrari's earnings call reflects strong financial performance and strategic growth. High EBITDA and EBIT margins, along with robust cash flow, indicate solid profitability. The strategic product development and strong order book, especially for new models like Amalfi, highlight demand strength. Despite challenges like tariffs and FX headwinds, Ferrari maintains pricing power and innovation. Guidance remains strong, with no reduction in shareholder returns. While some uncertainties exist, such as the Elettrica margin impact, overall sentiment is positive, suggesting a likely 2-8% stock price increase.
Ferrari N.V. (RACE) Q2 2025 Earnings Call Transcript
Positive7-31
The earnings call summary shows strong financial performance with growing revenues, high EBITDA, and effective cost management. Although there are concerns about U.S. tariffs, the guidance remains optimistic, and no program delays are reported. The Q&A highlights strong demand for new models and positive market strategies, despite some pressure on residual values. The overall sentiment is positive, driven by strong earnings, optimistic guidance, and a commitment to sustainability and innovation.
RACE Slides
RACE Report
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