Porsche Profit Rebounds as Carmaker Cuts Its Reliance on China

Porsche has reported a strong recovery in operating profit for the first nine months of 2026, while revenue and vehicle deliveries continued to shrink. The German sports carmaker also said it has significantly lowered its dependence on China, a market that has become increasingly difficult for foreign luxury brands.

The Volkswagen-owned company released its third-quarter results on Tuesday. Operating profit for the nine-month period came to 1.74 billion euros ($1.94 billion), up from just 40 million euros a year earlier. The prior-year figure was weighed down by roughly 2.7 billion euros in strategic restructuring costs.

Sales revenue, however, slipped 5.9% to 25.28 billion euros. Deliveries fell 16% to 178,532 vehicles. North America remained Porsche's biggest sales region by volume.

China has long been a key market for German premium automakers, but they have found it harder to compete with local rivals, especially in electric vehicles. Porsche's sales there have dropped steeply in recent years as brands such as BYD, Geely and Xiaomi have gained ground.

Chief financial officer Jochen Breckner addressed the issue during the earnings webcast. "Our geographically balanced sales footprint continues to provide resilience across different markets," he said. "As you know, we have significantly reduced our exposure to China. This makes our overall business less dependent on developments from this challenging market environment."

Porsche shares were last seen trading 2.3% higher after the announcement. The company is also cutting thousands of jobs as part of a wider restructuring meant to lower costs and respond to softer demand.

Analysts at Citi said in a note on Tuesday that the nine-month results matched expectations despite the challenges, including those in China. They pointed to "exceptionally low deliveries, higher costs, and higher battery electric vehicle deliveries," but said Porsche's underlying EBIT "remains very resilient and ahead of German premium peers."

The analysts added that Porsche has set out a plan to return to double-digit underlying operating profit margins, with recovery expected to begin in 2028. Net cash flow is projected to climb back above its IPO levels by 2031.

"Whilst FY27 will remain a trough year, we still see a solid, well-supported and credible multi-year EBIT and net cash recovery starting financial year 2028 - unlike many peers," the analysts said.