Volvo, the Swedish automotive company, is set to release its second-quarter results on Wednesday. Analysts predict a net profit of 12.95 billion Swedish kronor ($1.26 billion) for the quarter, an increase from 10.44 billion in the same period last year.
Sales are also expected to rise, reaching SEK135.0 billion compared to SEK118.9 billion previously.
Here are some key points to watch:
Trucks: Pricing in the truck sector is expected to be higher this quarter, leading to potential upside in truck margins, according to Citi analyst Klas Bergelind. While inflation from suppliers remains a challenge, it is not significant enough to offset the price increase. Bergelind estimates a near 15% truck margin for Q2, compared to the street consensus of 13.4%.
Supply Chain: Volvo reported improved productivity in its European supply chains during Q1, but stability issues persist in the North American supply chain, causing disruptions in production.
Orders: Truck order intake for Q2 is anticipated to be consistent with Q2 2022, but a decrease of 10% sequentially due to slightly weaker North America orders and a decline in Europe based on weaker European PMI numbers.
Guidance: Volvo has provided its market projections for the heavy-duty truck sectors in various regions: 320,000 units for Europe and North America in 2023, 80,000 for Brazil, 400,000 for India, and 850,000 for China. Citi expects Volvo to maintain this market guidance.
Stay tuned for further updates on Volvo’s performance.