Stellantis NV on Thursday reported a profitable second quarter that was boosted by rising demand for its vehicles in North America.
The maker of Chrysler, Jeep, Ram and Fiat vehicles posted quarterly net profit of $335 million (293 million euro), compared to a loss of $2.1 billion (1.87 billion euro) a year ago. Net revenues were $49.8 billion (43.5 billion euro), an increase of 13%.
Milan-listed shares of the automaker were down 5% on the news Thursday morning as investors sought signs that CEO Antonio Filosa’s recently-announced turnaround plan for the transatlantic automaker is working.
While the company’s North American performance appears to be improving, Stellantis flagged challenges in its other large market, Europe, which faces pricing and market-share pressure due to Chinese competition and other factors. Europe was the company’s only region to post a negative adjusted operating income margin for the quarter.
“The second quarter was marked by continued progress, led by North America and supported by important contributions from all other regions,” Filosa said in a statement, noting improved performance across several key financial metrics, including free cash flow. He said the implementation of the company’s new business plan, called FastLane 2030, is “well underway,” and the company is confident it will deliver on its previous 2026 guidance.
Formed in 2021, Stellantis had reported its first loss of about $26 billion last year after big write-downs related to unraveling its prior electric vehicle investments made under former CEO Carlos Tavares. The automaker also struggled with sales as it sought to readjust pricing and fill key gaps in vehicle lineups, including in the U.S. market.
A gradual turnaround appears to be taking shape this year. In the first quarter, the automaker returned to profitability amid improvements in its North American business. U.S. sales have also been trending in the right direction, up 6% last quarter in large part thanks to success of the Ram truck brand, especially sales of the Ram 1500 pickup. Still, challenges persist, including with quality, as the automaker has dealt with several high-profile and costly recalls of Jeeps and other vehicles lately.
Filosa and other executives unveiled the new $70 billion turnaround plan in May that involves a series of new products, new partnerships in manufacturing and technology, and more disciplined capital allocation.
Yet the planned changes, and early performance improvements, haven’t yet convinced investors: New York-listed shares of Stellantis are down by nearly half since the start of the year, and have declined after Filosa formally unveiled the new business plan two months ago. In February, the Stellantis announcement of its massive EV restructuring charge triggered an especially large selloff.
Ford Motor Co. and General Motors Co. reported earnings earlier this month. GM reported second-quarter profits of $3.9 billion and said it was doling out dividends to stockholders. Ford, meanwhile, reported a $1.3 billion loss related to charges for changing its EV plans, but the company upped its guidance for the rest of the year, pleasing investors.
lramseth@detroitnews.com
This article originally appeared on The Detroit News: Stellantis reports quarterly profit but investors wary about turnaround progress
Reporting by Luke Ramseth, The Detroit News / The Detroit News
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By Luke Ramseth, The Detroit News | USA TODAY Network
