BMW Group (BMW) Q2 2026 (Q&A) earnings summary

Executive summary

• Management reaffirmed strategic direction with a focus on technology openness, global footprint, and cost structure improvements, implementing a four-pillar restructuring program and accelerating efficiency measures to address intensified competition and market downturns, especially in China.

• Delivered over 2.46 million vehicles in 2025, with BEV sales reaching 442,000 units (17.9% of total), and maintained strong profitability, robust cash flow, and consistent dividend payouts.

• Group profit before tax fell 29.4% year-over-year to €4,045 million for H1 2026, with revenues down 8.0%, mainly due to a sharp market downturn in China and negative currency effects.

• The restructuring includes an 8,000 headcount reduction, primarily in overhead/white-collar roles, with expected savings materializing mainly from 2027 onward.

• Continued strategic focus on electrification, digitalization, and sustainability, with significant investments in battery technology and production footprint.

Financial highlights

• EBIT margin in the automotive segment was 8.6% in 2025, with a strategic target of 8-10%; H1 2026 EBIT margin fell to 3.6%, and Q2 2026 to 2.3%.

• Group revenues were €62,266 million for H1 2026, down 8.0% year-over-year; net profit for H1 was €2,872 million, down 28.5%.

• Free cash flow in the automotive segment reached €3.2 billion at year-end 2025 and €1,290 million for H1 2026, down from €2,345 million in H1 2025.

• R&D expenditure in 2025 was €8.3 billion, down over 8% year-on-year; H1 2026 R&D spend was €3,714 million, down 7.6%.

• Dividend payout ratio maintained within the 30-40% corridor, with €4.40 per ordinary share for 2025.

Outlook and guidance

• 2026 profit before tax expected to see a significant decrease; deliveries and workforce to slightly decrease, with global deliveries expected to be slightly below 2025 levels.

• Automotive EBIT margin outlook for 2026 is 1-3%, with ROCE of 1-5%; Financial Services ROE at 13-16%; Motorcycles EBIT margin at 4-6%.

• Free cash flow expectation for 2026 is above €2.5 billion.

• Most restructuring-related cash outflows expected in 2027, with run-rate savings from 2028 onward.

• Further strategic details and updates to be provided at the Capital Markets Day in September.