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Investing.com -- Renault (EPA:RENA) posted a record operating profit for 2024, surpassing expectations as cost reductions and a series of new vehicle launches helped strengthen margins. However, the company lowered its 2025 margin forecast, sending its shares down over 1% in Paris trading Thursday.
The French automaker, which was among the few in the industry to maintain its targets last year, reported an operating profit of 4.3 billion euros ($4.49 billion), a 3.5% increase from the previous year and slightly above the company-compiled consensus estimate of 4.2 billion euros.
Revenue climbed 7.4% to 56.2 billion euros, exceeding the expected 54.5 billion euros. The growth was fueled by successful model launches, including the compact electric R5 and several new hybrid vehicles. Renault also achieved an operating margin of 7.6% for 2024, meeting its goal of at least 7.5% for the year.
But the carmaker revised its margin forecast for 2025 to at least 7%, citing the impact of stricter European carbon emissions regulations. The new standards are expected to reduce the margin by one percentage point, equivalent to around 500 million euros in operating profit.
Still, Jefferies analysts said the guidance implies "a solid underlying margin."
Renault’s 2024 net income on a group share basis declined to 752 million euros from 2.2 billion euros the previous year. The drop was attributed to Renault’s sale of shares in Nissan (OTC:NSANY), a partial impairment on its investment in the Japanese automaker, and a significantly lower earnings contribution.