Michelin (ML) Q1 2025 TU earnings summary

Executive summary

• Q1 2025 sales declined 1.9% to €6,515 million, mainly due to a 7.3% drop in OE volumes, partially offset by a strong price-mix effect (+4.8%).

• Replacement markets showed resilience, with growth in Europe and North America, while China was weaker.

• Group maintained full-year guidance, expecting segment operating income above 2024 levels and free cash flow before acquisitions above €1.7 billion.

• Innovation leadership demonstrated through new product launches, digital solutions, and strong OEM partnerships.

• Sale of Midas franchise network expected to add US$200 million to 2025 net income.

Financial highlights

• Q1 2025 consolidated sales: €6,515 million, down 1.9% year-over-year.

• Volume effect: -7.3%; price-mix effect: +4.8% (mix +2.5%, price +2.3%); currency effect: +0.7%.

• RS1 sales up 1.2% to €3,559 million; RS2 down 3.5% to €1,529 million; RS3 down 7.3% to €1,427 million.

• Replacement sales volumes increased for passenger car, light truck, and new truck tires.

• Non-tire businesses nearly stable (-0.1%).

Outlook and guidance

• Full-year 2025 guidance maintained: segment operating income above 2024 at constant FX, free cash flow before M&A above €1.7 billion.

• OE market expected to stabilize in H2 2025; replacement markets to reflect moderate global growth.

• Guidance assumes current tariffs and regulations; ongoing volatility and unpredictability noted.

• Resilient business model and strong financial ratings support confidence in guidance.