Key Takeaways Ferrari shares fell 17% despite steady demand, strong margins and a multi-year backlog.Product momentum led by the Purosangue helped lift mix, protect margins and extend orders to 2027.Pricing power, personalization revenue and tight production continue to support Ferrari's resilience.Ferrari N.V.’s ((RACE) stock has hit a bumpy patch recently, falling about 17% over the last three months, even while major automakers like General Motors ((GM) and Ford ((F) saw their shares climb. The stock tra ...

Core Insights - Ferrari N.V.'s Purosangue is a significant growth catalyst for the company, expected to continue its strong performance into 2025 [1] - The Purosangue's demand has positively impacted Ferrari's product mix and margins, showcasing the brand's ability to expand without losing exclusivity [1][3] - The model's successful integration of performance and practicality has resonated well with global buyers, reinforcing Ferrari's brand prestige [2] Company Performance - In Q3, the Purosangue, along with other models like the 296 GTS and the 12Cilindri family, contributed to a total of 3,401 unit deliveries for Ferrari [3][9] - The Purosangue's production is tightly controlled to maintain rarity, which supports pricing strength and brand exclusivity [2][9] - A robust order book for the Purosangue indicates strong future demand, positioning it as a key pillar in Ferrari's modern era [3] Industry Context - The luxury SUV market is becoming increasingly important for automakers, with companies like Porsche leveraging their SUV portfolios for sales growth [4] - In contrast, Aston Martin has faced challenges with its DBX model, which has not met initial sales expectations, highlighting the competitive landscape in the ultra-luxury SUV segment [5]

Core Insights - Ferrari's newest model, the Amalfi, is attracting a younger demographic, with the first two sales in China going to clients under 40 years old, and approximately 40% of potential buyers being new to the brand [1][3] - The debut of the Amalfi is performing better than the previous model, the Purosangue, indicating strong demand and positive market reception [2] - The influx of younger buyers is expected to drive Ferrari's next phase of high-margin growth, enhancing the brand's exclusivity and order book visibility extending through 2027 [3][4] Demand and Customer Profile - The Amalfi's early success with under-40 clients signifies a shift in Ferrari's customer profile, particularly in the Chinese market [3] - CEO Benedetto Vigna emphasized that attracting new customers was a key objective for the Amalfi, which appears to be successfully achieved [3] Business Strategy - Ferrari maintains its focus on innovation rather than volume, asserting that pricing power is driven by innovation rather than production scale [5] - The company's approach to innovation, from design to personalization, helps sustain high margins even as it broadens its customer base [5] Investor Implications - The introduction of the Amalfi and the engagement of younger customers are seen as pivotal for Ferrari's growth, suggesting that the luxury brand's competitive edge is not only maintained but is expanding [6]

Financial Data and Key Metrics Changes - Total revenues reached approximately EUR 1.8 billion, a 7.4% growth year over year with flat deliveries [13] - EBIT was over EUR 500 million, indicating strong profitability [13] - Industrial free cash flow was EUR 365 million, reflecting solid business performance [13][20] - EBITDA margin stood at 37.9% and EBIT margin at 28.4%, despite challenges from increased import tariffs [19] Business Line Data and Key Metrics Changes - Shipments were driven by models such as the 296 GTS, Purosangue, and the 12-cylinder family, while deliveries of the Daytona SP3 were lower due to its phase-out [16][17] - Personalizations accounted for approximately 20% of total revenues from cars and spare parts, particularly relevant for the SF90 XS family and Purosangue [18] Market Data and Key Metrics Changes - The U.S. market showed normalization in consumer behavior following clarity on tariffs, with business proceeding as usual [66] - The company noted a significant changeover of models, with only 15% of the lineup in ramp-up phase at the beginning of 2025, increasing to 35% by year-end [13] Company Strategy and Development Direction - The company aims for EUR 9 billion in revenues by the end of the decade, with a 40% EBITDA margin and a 30% EBIT margin [4] - A flexible approach to powertrain offerings has been adopted, recalibrating to 40% ICE, 40% hybrid, and 20% electric by 2030 [6] - The company plans to introduce an average of four new models per year between 2026 and 2030, focusing on innovation and client-centricity [5][8] Management's Comments on Operating Environment and Future Outlook - The macroeconomic environment remains uncertain and volatile, but the company is committed to a six-year growth plan [9] - Management expressed confidence in maintaining pricing power through continuous innovation and product differentiation [39][81] Other Important Information - The company has achieved approximately 30% reduction in Scope One and Scope Two emissions and aims for a 10x reduction by 2030 [10] - The order book extends well into 2027, indicating strong demand for new models [12] Q&A Session Summary Question: Impact of mix on Q4 performance - Management noted that the mix impact in the second half of the year has been slightly better than anticipated, mainly due to strong personalization [29] Question: Pricing power and future expectations - Management expressed confidence that pricing power will continue, driven by innovation and product richness [39] Question: Hybrid share reduction - The reduction in hybrid offerings is linked to the changeover of models and not indicative of a broader trend [46] Question: Demand for new models - Demand for the Purosangue is strong, with over 40% of potential buyers being new to the brand [54] Question: F1 budget increase - The increase in the F1 budget will flow through as a cost increase, impacting the P&L [96] Question: FX impact on order backlog - The company can adjust pricing based on currency fluctuations, with a 90-day notice period for changes [98]

Financial Data and Key Metrics Changes - Total revenues reached approximately €1.8 billion, reflecting a 7.4% year-over-year growth with flat deliveries [13] - EBIT exceeded €500 million, indicating strong profitability [13] - Industrial free cash flow was reported at €365 million, showcasing solid business performance [13][20] - EBITDA margin stood at 37.9% and EBIT margin at 28.4%, despite challenges from increased import tariffs [19] Business Line Data and Key Metrics Changes - Shipments were driven by models such as the 296 GTS, Purosangue, and the 12-cylinder family, while deliveries of the Daytona SP3 were lower due to its phase-out [16][17] - Personalizations accounted for approximately 20% of total revenues from cars and spare parts, particularly benefiting the SF90 XS family and Purosangue [18] Market Data and Key Metrics Changes - The company noted a significant changeover of models, with only 15% of the lineup in ramp-up phase at the beginning of 2025, increasing to 35% by year-end [13] - The order book extends well into 2027, indicating strong demand for new models [12] Company Strategy and Development Direction - The company aims for €9 billion in revenues by the end of the decade, with a 40% EBITDA margin and a 30% EBIT margin [4] - A flexible powertrain strategy has been recalibrated to 40% ICE, 40% hybrid, and 20% electric, reflecting market dynamics and client preferences [6][7] - The company plans to introduce an average of four new models per year between 2026 and 2030, focusing on innovation and exclusivity [5][8] Management's Comments on Operating Environment and Future Outlook - The macroeconomic environment remains uncertain, but the company expresses confidence in its business model and growth plans [9] - The company has achieved a 30% reduction in Scope One and Scope Two emissions and aims for a tenfold reduction by 2030 [10] Other Important Information - The company has completed its share repurchase program ahead of schedule, reflecting strong confidence in future performance [14] - The introduction of the Ferrari Elettrica is seen as a significant opportunity for innovation and market engagement [10][11] Q&A Session Summary Question: Impact of mix on Q4 performance - Management noted that the mix impact in the second half of the year has been slightly better than anticipated, primarily due to strong personalization [25][29] Question: Pricing power and future expectations - Management expressed confidence in maintaining pricing power through continuous innovation and product enrichment [37][39] Question: Hybrid vehicle share and delivery figures - The reduction in hybrid offerings is linked to model changes, and initial deliveries of the F80 are expected to be limited in Q4 [45][47] Question: Consumer behavior in the U.S. market - The business in the U.S. is proceeding normally, with tariffs now stabilized at 15%, and no unusual order cancellations have been observed [64][66] Question: Margin stability amidst investments - Management emphasized the importance of continuous innovation to maintain margin stability, despite necessary investments in new facilities and technologies [88][92]

Financial Data and Key Metrics Changes - Total revenues for Q3 2025 reached approximately €1.8 billion, reflecting a 7.4% year-over-year growth with flat deliveries [13] - EBIT exceeded €500 million, indicating strong profitability [13] - Industrial free cash flow was reported at €365 million, showcasing solid business performance [13][20] - EBITDA margin stood at 37.9% and EBIT margin at 28.4%, despite challenges from U.S. import tariffs and currency fluctuations [19] Business Line Data and Key Metrics Changes - Shipments were driven by models such as the 296 GTS, Purosangue, and the 12-cylinder family, while deliveries of the Daytona SP3 were lower due to its phase-out [16][17] - Personalizations accounted for approximately 20% of total revenues from cars and spare parts, particularly benefiting the SF90 XS family and Purosangue [18] Market Data and Key Metrics Changes - The U.S. market showed resilience despite previous concerns over consumer behavior due to tariffs, with a normalization observed as tariffs were reduced from 25% to 15% [38] - The order book extends well into 2027, indicating strong demand for new models like the Testa Rossa family and Amalfi [13][34] Company Strategy and Development Direction - The company aims for €9 billion in revenues by the end of the decade, with a 40% EBITDA margin and a 30% EBIT margin [3] - A flexible powertrain strategy has been adopted, recalibrating the 2030 breakdown to 40% ICE, 40% hybrid, and 20% electric, responding to market dynamics and client preferences [5][6] - The company plans to introduce an average of four new models per year between 2026 and 2030, focusing on innovation and exclusivity [4][12] Management's Comments on Operating Environment and Future Outlook - The macroeconomic environment remains uncertain and volatile, but the company expresses confidence in its business model and growth plans [9] - A commitment to decarbonization has been reaffirmed, with targets to significantly reduce emissions by 2030 [10] Other Important Information - The company has achieved a 30% reduction in Scope One and Scope Two emissions and a 10% reduction per car in Scope Three emissions from 2021 to 2024 [10] - The new facility in Maranello is designed to manufacture all three powertrains, showcasing the company's commitment to flexibility and innovation [7] Q&A Session Summary Question: Impact of mix on Q4 performance - The mix impact in the second half of the year has been slightly better than anticipated, mainly due to strong personalization [24][25] Question: Personalization penetration rates - The long-term penetration of personalization is guided to be around 19%, with new facilities aimed at enhancing client engagement [26] Question: F80 rollout strategy - The F80 will roll out over three years, consistent with the company's approach to manage production and demand effectively [30] Question: Demand for new models - Demand for both the Coupe and Spider versions of the 849 Testa Rossa is strong, with significant interest in the Amalfi as well [32][34] Question: Hybrid warranty program - The hybrid warranty program is gaining traction, with penetration rates exceeding 20%, although some dealers require retraining to better explain the benefits [34] Question: U.S. market dynamics - The business in the U.S. is proceeding normally, with no unusual order cancellations observed despite concerns over residual values [38] Question: F1 budget impact - The increase in the F1 budget will flow through as a cost increase, impacting the P&L [50]

Core Insights - Ferrari's CEO, Benedetto Vigna, emphasized the company's commitment to sustainable growth and innovation in electric technology, particularly with the Ferrari Elettrica, during the Capital Markets Day [1] Financial Performance - For Q3 2025, Ferrari reported net revenues of €1,766 million, an increase of 7.4% year-over-year, with total shipments of 3,401 units, reflecting a 1% increase [2][7] - Operating profit (EBIT) for the quarter was €503 million, up 7.6% from the previous year, maintaining an EBIT margin of 28.4% [2][12] - Net profit for Q3 2025 reached €382 million, a 1.8% increase compared to Q3 2024, with diluted EPS at €2.14, up from €2.08 [2][15] Shipment and Product Mix - Total shipments for Q3 2025 were 3,401 units, showing a slight increase of 1% compared to the same period last year [3][4] - The product mix included six internal combustion engine (ICE) models and five hybrid engine models, with ICE models accounting for 57% of total shipments [5][6] Revenue Breakdown - Revenue from cars and spare parts was €1,479 million, up 5.6% year-over-year, driven by a richer product mix and increased personalizations [8][9] - Sponsorship, commercial, and brand revenues reached €211 million, a significant increase of 21% year-over-year, attributed to improved sponsorships and lifestyle activities [9] Cost and Cash Flow - EBITDA for Q3 2025 was €670 million, reflecting a 5% increase from the previous year, with an EBITDA margin of 37.9% [11][12] - Industrial free cash flow for the quarter was strong at €365 million, supported by increased EBITDA and effective working capital management [16] Debt and Liquidity - As of September 30, 2025, Ferrari's net industrial debt was €116 million, a significant reduction from €338 million as of June 30, 2025, with total available liquidity at €1,968 million [17] 2025 Guidance - The company revised its 2025 guidance upward during the Capital Markets Day, projecting net revenues of at least €7.1 billion and adjusted EBITDA margin of at least 38.3% [18][19]

Summary of Ferrari's 2025 Capital Markets Day Company Overview - **Company**: Ferrari (NYSE:RACE) - **Event**: 2025 Capital Markets Day - **Date**: October 09, 2025 Key Points and Arguments Company Growth and Achievements - Since its IPO in 2015, Ferrari has invested €6.5 billion in capital expenditures, launching 41 new sports cars and doubling its workforce from approximately 3,000 to 6,000 employees [3][2] - The company has filed 883 patents since the IPO, with 144 filed in the current year, showcasing its commitment to innovation [3][2] - Ferrari emphasizes its unique identity through three dimensions: heritage, technology, and racing [4][3] Educational Initiatives - Ferrari announced the creation of the M-Tech Alfredo Ferrari educational hub in Maranello, set to open in 2029, aimed at training future engineers and technicians [5][4] Commitment to Innovation - The new Ferrari Elettrica is highlighted as a revolutionary electric vehicle that combines technology, design, and manufacturing craftsmanship [6][5] - The company aims to maintain its uniqueness through continuous innovation and commitment to its people and community [7][6] Racing and Performance - Ferrari's racing heritage is a core aspect of its identity, with a commitment to winning in Formula One and endurance racing [9][8] - The company has achieved significant success in racing, including three consecutive wins at Le Mans [9][8] Product Strategy and Market Positioning - Ferrari's product strategy focuses on creating unique models for different client needs, emphasizing a horizontal diversification approach [29][28] - The company plans to increase the number of internal combustion (IC) models to 40% by 2030, while reducing electric models to 20% [28][27] Client Engagement and Community - Ferrari has expanded its client base to approximately 90,000 active clients, a 20% increase from 2022, with 32,000 new clients acquired since then [45][44] - The company aims to enhance the client experience through personalized services and exclusive events, fostering a strong community among Ferraristi [54][53] Sustainability and Decarbonization - Ferrari is committed to sustainability, establishing a Green Dealer Award to recognize dealers achieving decarbonization goals [58][57] - The company emphasizes the importance of maintaining a balance between luxury and environmental responsibility [20][19] Future Outlook - Ferrari plans to continue launching around four new models per year, with a focus on the upcoming Ferrari Elettrica as a key addition to its product lineup [60][59] - The company aims to leverage technology neutrality to offer diverse powertrains, including IC, hybrid, and electric options, ensuring a unique driving experience for clients [62][61] Additional Important Content - Ferrari's unique business model is characterized by a high percentage of cars still in circulation, with over 90% of the 330,000 cars produced since 1947 still alive [38][37] - The company emphasizes the importance of personalization, ensuring that every car is unique to its owner [53][52] - Ferrari's commitment to training and developing its workforce is highlighted, with around 50 tailored courses offered to employees [44][43] This summary encapsulates the key points discussed during Ferrari's 2025 Capital Markets Day, reflecting the company's growth, commitment to innovation, and strategic direction in the luxury automotive market.

Core Insights - Ferrari N.V.'s Purosangue has established itself as a significant contributor to the company's delivery performance, alongside the 296 GTS and Roma Spider, with total deliveries remaining steady at 3,494 units in Q2 2025 [1][4][11] - The Purosangue is Ferrari's first four-door SUV, launched in September 2022, combining high performance with the practicality of an SUV, and is described as the company's most comfortable and versatile vehicle [2][11] - Ferrari's strategy involves careful management of Purosangue production to maintain exclusivity while enhancing delivery volumes and pricing power, ensuring growth without compromising brand heritage [3][11] Delivery Performance - In Q2 2025, the Purosangue emerged as a key model driving deliveries, reinforcing Ferrari's robust order book and expectations for continued delivery strength in upcoming quarters [4][11] Competitive Landscape - Other luxury automakers, such as Porsche and Aston Martin, are also leveraging SUVs for growth, with Porsche's Cayenne and Macan serving as sales anchors, while Aston Martin's DBX has faced execution challenges despite its potential [5][6]

Core Viewpoint - Porsche's sales in China have significantly declined, with a projected drop to 56,000 units in 2024, marking a 28% year-on-year decrease, after previously being the largest single market for the brand [6][17][31]. Group 1: Sales Performance and Market Position - In 2021, Porsche achieved a peak sales figure of 95,000 units in China, contributing one-third of its total sales [6][17]. - The Cayenne and Macan models accounted for approximately 60% of Porsche's sales in China since 2015 [11][14]. - The brand's sales average in China has decreased from 1.06 million to 930,000 yuan over the past three years, indicating a loss of market positioning [37]. Group 2: Electric Vehicle Strategy - Porsche has been aggressive in its electric vehicle (EV) transition, with plans for electric and hybrid models to make up 50% of total sales by 2025 and over 80% by 2030 [24][22]. - The Taycan, Porsche's first all-electric model, surpassed 40,000 units in global sales in 2021, becoming the best-selling model after the SUVs [24][18]. - The company has invested heavily in battery technology and partnerships to support its electric vehicle strategy, including the establishment of a joint venture for battery production [23][22]. Group 3: Challenges in Transition - Porsche faces significant challenges in its transition to electric vehicles, particularly due to reliance on the Volkswagen Group for software and electronic architecture, which has encountered delays [30][27]. - The development of the E3 electronic architecture has faced setbacks, impacting the launch timelines of new models like the Macan EV [30][28]. - The competitive landscape in the electric vehicle market has intensified, with domestic brands capturing over 60% of the market share, further complicating Porsche's position [37][31]. Group 4: Brand Positioning and Market Dynamics - Porsche occupies a unique position between luxury and premium segments, which exposes it to greater competitive pressures, especially in a rapidly evolving market [34][37]. - The brand's pricing strategy has been challenged by the aggressive pricing of electric vehicles, leading to a structural disruption in its pricing model [32][31]. - As competitors lower prices, Porsche's middle-ground positioning risks losing brand value, which could have long-term implications for its market strategy [37][34].