Recently, German automotive parts supplier Continental AG released its preliminary performance report for the third quarter of 2025, showing strong results across multiple key indicators that far exceeded market expectations. The tire division, with its exceptional profitability, acted as the "ballast" for the company's overall performance, demonstrating significant market resilience and strategic execution. According to the preliminary and unaudited data, Continental's sales in the third quarter reached approximately €5 billion, with an adjusted EBIT margin of 11.4%, notably higher than the market's average expectation of 9.5%. This impressive performance was mainly driven by the outstanding results of its two core business divisions: tires and ContiTech.
Tire Business: Significant Pricing Effect and Margin Improvement As a traditional strength of the group, the tire business performed exceptionally well this quarter. The division achieved sales of €3.5 billion, meeting analyst expectations. Even more striking was the adjusted margin increase from the market expectation of 13% to 14.3%, highlighting its strong profitability. Continental noted that the positive "price/product mix effect" was the core driver of the margin improvement. By optimizing its product structure and implementing precise pricing strategies, the company successfully offset the multiple negative impacts of weak global sales, currency fluctuations, and tariffs.
Additionally, the strong kickoff of the winter tire sales season provided a robust boost to performance, while ongoing cost control and reduced fixed costs laid a solid foundation for profit growth.
Strong Overall Performance and Bright Cash Flow In addition to the tire division, the ContiTech division also delivered solid results, with sales of €1.5 billion and an adjusted EBIT margin of 6.6%, also well above the market expectation of 4.6%. Alongside the improvement in profitability, the financial health of Continental saw notable enhancement. Thanks to outstanding operational efficiency, the group reported adjusted free cash flow of €200 million for the third quarter, nearly double the expected value of €113 million, providing ample fuel for the group's future investments and steady operations.
Based on the strong performance in the third quarter, Continental has reaffirmed its performance outlook for the full year of 2025, reflecting management's strong confidence in future growth. The company will release a detailed quarterly performance report on November 6, which will provide the market with a more comprehensive understanding of its operational details and future strategies across its various business segments.
Overall, in the face of a challenging macro environment, Continental has once again demonstrated its robust strength as an industry leader through precise strategic adjustments and exceptional operational management. The tire business's outstanding performance reflects not only its technological prowess and brand value but also serves as a key engine for the group's sustainable growth across cycles.