BMW announced on Tuesday that it is upgrading its full-year outlook after a solid first half and good momentum. However, the company reported a lower pretax earnings margin in the first half.
According to BMW, the group’s pretax earnings margin was 12.6% in the first half of this year, compared with 24.5% in the same period last year. The pretax earnings for the second quarter remained stable at 11.3%.
In the automotive segment, BMW reported an earnings before interest and taxes (EBIT) margin of 9.2% in the second quarter, which is an improvement from 8.2% a year ago.
BMW now anticipates the EBIT margin for the automotive segment in 2023 to be between 9% and 10.5%, compared with the previous target of 8% to 10%. Additionally, the company expects “solid growth” in automotive deliveries for this year, surpassing the previous outlook of “slight growth.” In the first half, BMW has already delivered 1.2 million units.
The automotive business is projected to have a free cash flow of over 6 billion euros ($6.60 billion) for the full year.
While citing headwinds from higher expenses for suppliers, BMW is set to release its full first-half results on Thursday.