Rheinmetall (RHM) Q4 2025 earnings summary

Executive summary

• Sales grew 29% year-over-year to nearly €10 billion in 2025, with operating result up 33% to €1.841 billion and margin at 18.5%.

• Order backlog reached a record €64 billion, up 36% YoY, with book-to-bill ratio above 2x.

• Civilian business divested, shifting focus entirely to defense and expanding into naval and space domains.

• Major acquisition of Naval Vessels Lürssen (NVL) closed, adding €5–6 billion in backlog and a new segment.

• Strong demand driven by geopolitical tensions, especially in Europe and the Middle East, and increased defense budgets.

Financial highlights

• Operating free cash flow rose 15% to €1.218 billion, supported by customer prepayments.

• Earnings per share from continuing operations increased to €25.28; proposed dividend of €11.50 per share, payout ratio at 45.5%.

• Net financial position turned positive at €369 million; equity ratio improved to 33.5%.

• Book-to-bill ratio exceeded 2x, with €26 billion in nominations and €20 billion fixed orders.

• Q4 2025 saw over €2 billion in positive cash flow, mainly from advance customer payments.

Outlook and guidance

• 2026 sales guidance: €14–14.5 billion (+40–45%), with 91% coverage already secured.

• Operating margin expected to rise to ~19% in 2026.

• Backlog projected to reach ~€135 billion by end of 2026, including NVL impact.

• Major projects include Project Arminius (€38 billion potential by 2035) and D-LBO digitization program (up to €10 billion).

• Targeting 30–40% CAGR up to 2030, aiming for €50 billion in sales with M&A.