Core Insights - Porsche reported a significant loss of €966 million (approximately ¥8 billion) in Q3, with profits plummeting 99% from €4 billion in the same period last year to just €40 million [1][3] - The decline in sales and profits has raised concerns about Porsche's market position, leading to discussions about its ability to recover through new product launches [1][3] Financial Performance - Q3 sales revenue was €8.7 billion, below market expectations of €9 billion, with a total revenue of approximately €26.86 billion for the first three quarters, a 6% year-on-year decline [1][3] - Deliveries in the first three quarters totaled 212,509 units, a 6% decrease compared to the previous year, with notable declines in key markets such as China, where sales dropped 26% [2][4] Strategic Challenges - Porsche's losses are attributed to past strategic decisions, including the postponement of electric vehicle launches and the extension of the lifecycle for several fuel and hybrid models, resulting in additional costs of approximately €2.7 billion [3][4] - The U.S. tariff policy has further pressured Porsche's performance, with an estimated additional cost of €300 million in the first three quarters of 2025, leading to a projected total loss of €700 million for the year [4] Market Dynamics - Despite the challenges, Porsche achieved record delivery numbers in the U.S. market, with sales increasing by 5% to 64,446 units, contrasting with a 26% decline in China [4][5] - The company is facing intense competition in the entry-level segment, with competitors offering superior price, quality, and emotional value, leading to a loss of younger customers [7][10] Product Development and Innovation - Porsche has not introduced a new flagship model in over a decade, leading to concerns about its product lineup and market appeal [5][11] - The electric vehicle strategy has been inconsistent, with the flagship electric model Taycan experiencing a 10% decline in sales, and the new electric Macan facing delays and challenges in the competitive Chinese market [8][10] Future Outlook - Porsche plans to optimize its organizational structure, with plans to lay off 1,900 employees and cut 2,000 temporary positions by 2025 [4][11] - The company anticipates that its performance will hit bottom this year, with expectations of significant improvement starting in 2026, although this is still far from its historical profit margins of 15% [4][11]