Iveco Group (IVG) Q2 2025 earnings summary

Executive summary

• Announced definitive agreement to sell Defence business (IDV and Astra) to Leonardo S.p.A. for EUR 1.7 billion, with proceeds to be distributed as an extraordinary dividend upon closing, expected by Q1 2026.

• Tata Motors offered to acquire the group (excluding Defence), pending the Defence business sale, with no workforce reductions or headquarters relocation planned.

• Q2 2025 marked by disciplined execution, positive free cash flow, and margin improvements in Bus and Defence, despite lower industry demand in European truck and Powertrain segments.

• Order intake increased year-over-year across all Truck segments and regions, with Bus and Defence maintaining strong momentum and visibility.

• Powertrain segment faced tough market conditions, with lower volumes and higher quality costs.

Financial highlights

• Q2 2025 consolidated net revenues: EUR 3.78 billion, down 3.5% year-over-year; industrial activities net revenues: EUR 3.7 billion, down 3.1%.

• Group adjusted EBIT: EUR 215 million (5.7% margin); industrial activities adjusted EBIT: EUR 187 million (5.1% margin), both down ~180 bps year-over-year.

• Adjusted net income: EUR 106 million, down EUR 56 million year-over-year; adjusted diluted EPS: EUR 0.39.

• Free cash flow of industrial activities: EUR 145 million, a EUR 243 million improvement year-over-year, driven by improved working capital and lower investments.

• Available liquidity: EUR 4.7 billion as of June 30, 2025.

Outlook and guidance

• Revised 2025 guidance: Group adjusted EBIT EUR 880–980 million (previously EUR 980–1,030 million); industrial activities net revenues down 3–5% year-over-year (previously flat); adjusted EBIT EUR 750–850 million (previously EUR 850–900 million); industrial free cash flow EUR 350–400 million (previously EUR 400–450 million).

• European light-duty truck industry expected down 10–15% for 2025; medium-duty truck forecast lowered; heavy-duty unchanged.

• Persistent macroeconomic uncertainties and delayed recovery in light-duty segment cited as reasons for guidance revision.

• CapEx plus OpEx savings of EUR 150 million confirmed for 2025, with potential for further savings.

• South America: light-duty truck outlook confirmed, medium/heavy-duty trucks forecast lowered due to Brazil's weak demand.