Continental (CON) Q2 2025 earnings summary

Executive summary

• H1 2025 saw resilient performance amid high volatility, with significant transformation activities including the upcoming Aumovio spin-off scheduled for September 18th and ongoing portfolio streamlining.

• Group sales for H1 2025 were €19,303 million, down 2.5% year-over-year, mainly due to negative exchange-rate effects; Q2 sales were €9.6 billion, down 4.1% year-over-year.

• Adjusted EBIT for H1 2025 rose 61.4% year-over-year to €1,473 million (7.6% margin), with Q2 adjusted EBIT margin improving to 8.7% from 7.1% in Q2 2024.

• Net income attributable to shareholders increased to €574 million, with basic EPS at €2.87.

• The group is realigning to focus on the Tires sector, with Automotive and Contract Manufacturing to be spun off and ContiTech to be sold.

Financial highlights

• Group adjusted EBIT margin for H1 2025 was 7.6%, with Q2 at 8.7%; net income rose to €574 million.

• Net indebtedness improved to €4,953 million as of June 30, 2025, with leverage ratio down to 1.1.

• Adjusted free cash flow for H1 was €550 million ahead of prior year, with Q2 at €147 million, a significant improvement from -€166 million in Q2 2024.

• Dividend of €2.50 per share paid for fiscal 2024.

• Capex in Q2 2025 was €545 million (2.5% of sales); R&D expenses for H1 were €1,503 million (7.8% of sales).

Outlook and guidance

• FY 2025 guidance confirmed: group sales for continuing operations expected at €19.5–21.0 billion, adjusted EBIT margin at 10.0–11.0%.

• Tires sector sales expected at €13.5–14.5 billion, adjusted EBIT margin 12.5–14.0%; ContiTech sales at €6.0–6.5 billion, margin 6.0–7.0%.

• Automotive (discontinued) sales expected at €18.0–20.0 billion, adjusted EBIT margin 2.5–4.0%.

• Adjusted free cash flow projected at €0.6–1.0 billion; margin expectations lowered due to exchange rates and trade barriers.

• Most spin-off related costs to occur in 2025; negative special effects of ~€350 million anticipated.