Ferrari has raised its performance guidance every Q3 since 2016, except for 2018 and this year.
On November 5th, Eastern Time, the Italian luxury car brand Ferrari announced its performance for the third quarter of 2024 before the U.S. stock market opened.
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1) Key Financial Data:
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Revenue: Third quarter revenue was €1.64 billion, a year-on-year increase of 6.5%, in line with market expectations of €1.64 billion; of which, revenue from cars and parts was €1.4 billion, a year-on-year increase of 5.3%, while market expectations were €1.42 billion; sponsorship, commercial, and brand revenue was €174 million, a year-on-year increase of 20%, with market expectations of €161.7 million.
Net Profit: Adjusted net profit for the third quarter was €375 million, a year-on-year increase of 13%, with market expectations of €369.8 million.
EBITDA: Adjusted EBITDA for the third quarter was €638 million, a year-on-year increase of 7.2%, with market expectations of €633.8 million; adjusted EBIT was €467 million, a year-on-year increase of 10%, with market expectations of €463.3 million; adjusted EBIT margin was 28.4%, up from 27.4% in the same period last year, with market expectations of 28%.
EPS: Adjusted diluted earnings per share for the third quarter was €2.08, compared to €1.82 in the same period last year, with market expectations of €2.03;
Free Cash Flow: Industrial free cash flow for the third quarter was €364 million, with market expectations of €342.7 million.
Delivery Volume: Third quarter delivery volume was 3,383 units, a year-on-year decrease of 2.2%, with market expectations of 3,469 units. In the segmented market, delivery volume in Europe, the Middle East, and Africa was 1,426 units, a year-on-year increase of 2%, with market expectations of 1,486 units; delivery volume in the Americas was 1,070 units, a year-on-year decrease of 2.4%, with market expectations of 1,097 units; delivery volume in China was 281 units, a year-on-year decrease of 29%, with market expectations of 348.4 units; delivery volume in other Asia-Pacific regions was 606 units, a year-on-year increase of 6.3%, with market expectations of 582.27 units.
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After the earnings report was released, Ferrari's stock fell more than 6.9% during trading, but has risen over 31% year-to-date.
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Analysts pointed out that although Ferrari's third quarter profit was slightly better than analysts' expectations, Ferrari did not raise its full-year performance guidance provided in August. Moreover, the market is very concerned about the shipment volume, as the overall downturn in the automotive industry has also affected Ferrari, with a decline in the core business of luxury sports car shipments. The third quarter shipment volume decreased by 2.2% year-on-year, with a 29% decline in the Chinese market and a 2.4% decline in the U.S. market
The market is concerned about the slowdown in luxury goods consumption, not just in automobiles, but even major companies selling luxury goods, such as LVMH and Kering Group, are warning that business is becoming increasingly difficult.
Although shipments have declined, Ferrari has found that demand for customized vehicles has increased. Ferrari CEO Benedetto Vigna stated:
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&#34;Ferrari's performance in the third quarter has once again achieved growth, thanks to a wider variety of products offered by the company and an increasing number of customers seeking personalized customization. This confirms that Ferrari will adhere to the commitments made on Capital Markets Day in 2022, and our orders are already booked until 2026. We are now more confident in achieving our annual targets.&#34;
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Goldman Sachs analysts, including George Galliers, maintain a &#34;neutral&#34; rating on Ferrari stock, with a 12-month target price of €470 ($508). They noted on Tuesday:
<blockquote>
&#34;Ferrari has raised its performance guidance in the third quarter every year since 2016 (except for 2018), so not raising it this year may be seen as disappointing. Ferrari reiterated its performance guidance for fiscal year 2024 and stated that despite rising costs, they are more confident in achieving their targets;
Market expectations for Ferrari's EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) and EBIT (Earnings Before Interest and Taxes) are currently about 2.5% and 2.6% higher than Ferrari's lower guidance. At the same time, Ferrari's lower guidance also implies that adjusted EBIT for the fourth quarter will decrease by about 11%;
We expect that, as in previous years, Ferrari's performance guidance will remain conservative. Ferrari stated that their orders are booked until 2026, and all orders for the new model F80 have been fully allocated.&#34;
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RACE

Ferrari's third-quarter shipments fell by 2.2% year-on-year, with the Chinese market down 29% year-on-year and the U.S. market down 2.4% year-on-year. Additionally, it did not raise its full-year performance guidance provided in August, and its stock price fell more than 6.9% during intraday trading on Tuesday

- Ferrari reported its Q3 2024 results, with revenue of €1.64 billion, a 6.5% increase year-over-year, meeting market expectations.  
- Despite a slight profit beat, the company did not raise its full-year guidance, raising concerns amid a 2.2% decline in vehicle deliveries, particularly a 29% drop in China.  
- CEO Benedetto Vigna noted increased demand for customized vehicles, and analysts maintain a neutral rating, citing disappointment over the lack of guidance increase for the first time since 2016.

Ferrari Q3 delivery volume declined, performance guidance not raised, intraday drop exceeded 6.9% | Financial Report Insights