BMW Group (BMW) Q3 2024 earnings summary

Executive summary

• Q3 results were significantly impacted by temporary delivery stops due to a supplier issue with the integrated braking system (IBS) and ongoing muted demand in China, leading to lower sales and earnings.

• BEV deliveries grew 19.1% year-over-year, reaching nearly 300,000 units in the first nine months and 375,716 units YTD 09-2024, now representing 15–19.1% of total sales.

• Provisions for warranty obligations related to IBS were fully recognized in Q3, in the high three-digit million EUR range.

• The company maintains global leadership in the premium segment, with a strategic focus on electrification, digitalization, and sustainability, including the Neue Klasse platform launching in 2025.

• R&D spending increased, focused on electrification, digitalization, and Neue Klasse models.

Financial highlights

• Q3 2024 revenues were €32.4 billion, down 15.7% year-over-year; nine-month revenues totaled €105.96 billion, down 5.8%.

• Group EBIT for Q3 was €1.7 billion; Group EBT was €838 million, with an EBT margin of 2.6%.

• Q3 net profit was €476 million, down 83.8%; nine-month net profit was €6.13 billion, down 35.8%.

• Automotive EBIT margin was 2.3% for Q3 and 6.6% for the first nine months; 2023 full year at 9.8%.

• Free cash flow in the automotive segment was negative €2.5 billion in Q3, mainly due to inventory buildup and warranty provisions.

Outlook and guidance

• 2024 profit before tax is expected to decrease significantly; automotive deliveries to see a slight decrease, but BEV share will increase significantly.

• Automotive EBIT margin expected between 6% and 7%; return on capital employed between 11% and 13%.

• Financial Services return on equity expected at 15–18% in 2024; Motorrad EBIT margin 6–7%.

• Free cash flow for the full year expected to exceed €4 billion.

• Capex ratio expected above 6% in 2024; R&D ratio above 5%.