Aston Martin Lagonda Global (AML) Q4 2025 earnings summary

Executive summary

• Navigated a challenging environment with geopolitical and macroeconomic pressures, including new tariffs in the U.S. and China, impacting volumes and margins.

• H2 2025 performance improved significantly over H1, driven by new core derivatives, initial Valhalla deliveries, and transformation program benefits.

• Achieved key milestones such as the start of Valhalla deliveries, expansion of the core lineup, and significant awards for new models.

• Maintained disciplined production aligned with demand, resulting in retail volumes outpacing wholesales and improved inventory health.

• Transformation initiatives and cost optimization measures implemented, including a 20% reduction in people costs and SG&A restructuring.

Financial highlights

• FY 2025 revenue was GBP 1.26 billion, down 21% year-over-year due to lower core volumes and fewer Specials deliveries.

• Wholesale volumes fell 10% to 5,448 units; retail volumes outpaced wholesales.

• Core average selling price (ASP) rose 5% to GBP 185,000, while total ASP declined 15% due to fewer Specials.

• Adjusted EBIT decreased to -GBP 189 million, reflecting lower gross profit, higher warranty costs, and tariff impacts.

• Gross margin declined year-over-year but improved sequentially in Q4 to 31% from 29%.

• Free cash outflow increased to GBP 410 million, with improved working capital and reduced CapEx.

• Net debt rose to GBP 1.38 billion; adjusted net leverage ratio at 12.8x.

Outlook and guidance

• Expect material improvement in financial performance for 2026, driven by enhanced product mix, especially 500 Valhalla deliveries.

• Targeting adjusted EBIT margin improvement toward breakeven and gross margin in the high 30s% on new vehicles.

• Free cash outflow expected to improve, with most outflow in Q1 2026 and stabilization from Q2 onward.

• Core volumes expected to remain at 5,500–6,000 units annually, with 250–500 specials per year.

• Capex for FY 2026 guided at approximately GBP 300 million, down from GBP 341 million in FY 2025.