Porsche (P911.DE, POAHY) lowered another profitability goal set at the time of its blockbuster listing after the luxury-car maker’s earnings slumped due to tumbling sales in China.
The German manufacturer is now aiming for a return on sales of between 15% and 17% in the medium term, Chief Financial Officer Jochen Breckner said Wednesday, having previously targeted as much as 19%.
This year will see the start of an “extensive rescaling” with model, software and battery investments that will hit 2025’s financial results, Porsche said. The company is planning an additional 911 and mulling a new SUV line toward the end of the decade as it pivots back to popular combustion engine and hybrid cars.
The shares fell as much as 5.1% on Wednesday. The stock has more than halved from its peak in May 2023.
Porsche is struggling to beat a clear path toward the lofty margins it was aiming for when it listed in 2022. Suffering from falling sales in China and lower demand for EVs in Europe, the Volkswagen AG-controlled brand has repeatedly had to drop guidance since then. It’s also been plagued by model delays and supply-chain disruption.
The carmaker has responded by recently walking back EV targets and announcing plans to spend €800 million ($872 million) developing more models powered by fossil fuels. The 911 maker is now replacing key management board members and pursuing job cuts.
The lower target came as Porsche reported that operating profit in 2024 plunged 23% to €5.64 billion from a year earlier. Sales fell 1.1% to €40.08 billion.
The company’s return on sales was 14.1%, at the lower end of its own range. Despite lowering its medium-term target, it’s sticking to a long-term margin goal of more than 20%.
Porsche last month said it anticipates up to €40 billion in sales this year, with a return on sales as low as 10%. VW on Tuesday said it expects to maintain profitability this year, even in the face of muted demand in Europe and rising trade tensions.
Porsche earlier this year announced it was reducing its headcount in Germany by 1,900 workers, in addition to a previous decision to stop renewing some 2,000 temporary contracts.
The automaker’s US business, which imports all its cars, is also vulnerable to any tariffs imposed by President Donald Trump.
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China’s Retail Investors Pile Into New Funds as Stocks Rally
China’s Retail Investors Pile Into New Funds as Stocks Rally
China’s Retail Investors Pile Into New Funds as Stocks Rally
China’s Retail Investors Pile Into New Funds as Stocks Rally
China’s Retail Investors Pile Into New Funds as Stocks Rally
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China’s Retail Investors Pile Into New Funds as Stocks Rally
Bloomberg News
Wed, March 12, 2025 at 5:17 AM GMT+1 2 min read
(Bloomberg) — The excitement over China’s technology development that pushed the nation’s stocks to outshine their global peers has attracted a substantial inflow of money from retail investors at home.
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Equity mutual funds raised 56.4 billion yuan ($7.8 billion) in the first two months of the year, a five-fold increase from the same period last year and the biggest amount since 2021, according to Bloomberg calculations based on Morningstar Direct data. The number of such funds launched also jumped 76% year-on-year, the data showed.
The surge in fund inflows underscores growing investor conviction that breakthroughs on the technology front may help counter risks from worsening deflationary pressures and escalation in a trade war with the US. Bullish messages from the just-concluded National People’s Congress also provided investors assurance that Beijing is ready to unveil more stimulus to hit a growth goal of about 5% this year.
Chinese equities have staged a world-beating rally this year thanks to DeepSeek-induced enthusiasm over homegrown artificial intelligence and other advanced technologies. The rally also triggered a strong re-rating of Chinese assets by global money managers including UBS Group AG, Morgan Stanley and JPMorgan Chase & Co.
The tech-heavy STAR50 Index climbed more than 9% in the January-February period, while a gauge of tech shares listed in Hong Kong surged nearly 25%.
As investor risk appetite rises, the number of mixed-allocation and bond-focused funds launched recently has fallen out of favor, however. Hybrid funds dropped by 38% in the first two months of 2025 compared to a year ago, while the number of bond funds fell by 29%, according to the data.
The moves were “driven by a combination of the bottoming of long term domestic bond yields and increased optimism in China equities driven by greater confidence in the long term outlook of China’s tech sector,” said Gary Tan, a portfolio manager at Allspring Global Investments.
–With assistance from Mengchen Lu and Chongjing Li.
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China’s commerce ministry met with Walmart on supplier pricing, state media says
FILE PHOTO: Walmart offers drivers new bonuses in e-commerce battle with Amazon · Reuters
Reuters
Wed, March 12, 2025 at 9:20 AM GMT+1 1 min read
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SHANGHAI (Reuters) – Chinese officials met with Walmart this week to discuss media reports that the U.S. retailer has asked Chinese suppliers to slash prices to offset U.S. tariffs on goods from China, according to CCTV-affiliated social media posts.
The posts, published on Wednesday on the Weibo account of Yuyuantantian, which is affiliated with state-run CCTV, said the meeting between China’s commerce ministry and Walmart representatives was held on March 11. The posts cited sources familiar with the meeting.
Last week, Bloomberg News reported, also citing sources, that certain Chinese suppliers, including makers of kitchenware and clothing, had been asked to lower their prices by as much as 10% per round of tariffs, essentially shouldering the full cost of duties imposed by U.S. President Donald Trump.
Neither Walmart nor China’s commerce ministry immediately responded to requests for comment.
(Reporting by Casey Hall; Editing by Muralikumar Anantharaman)
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US Stock Skepticism Deepens as Goldman Cuts S&P 500 Target
Abhishek Vishnoi
Wed, March 12, 2025 at 8:47 AM GMT+1 2 min read
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(Bloomberg) — Goldman Sachs Group Inc (GS). strategists lowered their target for the US equity benchmark, and lifted their view on European earnings, in a further sign of growing skepticism on the outlook for the world’s largest economy.
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The bank’s strategists cut the year-end target for the S&P 500 Index (^GSPC) to 6,200 from 6,500, implying an 11% gain from Tuesday’s close. The reduction was also in view of declines in the “Magnificent 7” stocks.
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“Our revised estimates reflect the recently reduced GDP growth forecast of our US economics team, a higher assumed tariff rate, and higher level of uncertainty that is typically associated with a greater equity risk premium,” strategists including David Kostin and Jenny Ma wrote in a note dated Tuesday.
A separate team led by Lilia Peytavin raised its Stoxx Europe 600 (^STOXX) earnings-per-share growth forecast to 4% for 2025 and 6% for 2026 and 2027. “This upgrade reflects a stronger medium-term economic growth outlook in the Euro area and tailwinds from a weaker Euro compared with our 2025 outlook,” they wrote.
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Goldman joins a growing chorus of banks that have expressed concerns over economic growth amid heightening geopolitical uncertainties. Analysts at Citigroup Inc (C). and HSBC Holdings Plc (HSBC) downgraded their views on US equities this week, citing similar worries around the economy and noted better opportunities elsewhere.
Market forecasters at banks including JPMorgan Chase & Co. and RBC Capital Markets have also tempered bullish calls for 2025.
President Donald Trump’s on-again, off-again trade policies and the ongoing government job cuts have sent measures of consumer and business sentiment lower as recession fears mount. The uncertainty has pushed the S&P 500 gauge down by more than 9% from a high in February, while the tech-heavy Nasdaq 100 (^NDX) tumbled into correction last week.
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Goldman strategists trimmed their earnings growth forecast for the year to 7% from 9% and reduced their price-to-earnings ratio by 4%. Kostin was among analysts who were bullish on US stocks last year and has warned of growth risk to equities in recent weeks.
They said investors should own stocks that are insulated from the major drivers of ongoing market volatility such as lender Bank of New York Mellon Corp. (BK), financial information services provider S&P Global Inc. (SPGI), and rating agency Moody’s Corp. (MCO)
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