By Dominic Chopping

Volkswagen warned that first-quarter earnings missed expectations after taking a hit from one-off items including some early impact from U.S. import tariffs.

The German automaker said late Wednesday that operating profit fell to around 2.8 billion euros ($3.07 billion) in the quarter from 4.6 billion euros last year. The preliminary result is a significant miss to the 4 billion euros expected by the market, in part due to the import tariffs, it said.

Volkswagen booked around 1.1 billion euros in one-off costs during the period, with tariffs, provisions, European carbon-dioxide regulation and restructuring costs all having an impact.

The auto industry faced a tough end to the quarter as U.S. President Trump's 25% tariffs on automobile imports kicked in during the first week of April. Volkswagen said it was still too early to fully assess the impact of the tariffs, but that the hit it booked in the first quarter related to a valuation adjustment of vehicles that were in transit to the U.S. before the levies were imposed.

Despite the uncertainty, the company maintained its full-year outlook for up to 5% sales growth and operating return on sales of between 5.5% and 5.6%, but the forecasts exclude any impact of tariffs.

Group sales in the first quarter rose to around 78 billion euros from 75.5 billion euros while the operating return on sales came in at around 3.6% from 6.0% last year, it said.

There are too many moving parts to be able to accurately predict quarterly earnings, which severely reduces the value of VW's forecasts, analysts at Citi said in a note to clients.

The profit warning reduces investor confidence, they added.

Trump on Wednesday announced a 90-day pause to his so-called reciprocal tariffs imposed on most countries, but the 25% auto tariff remains in place.

Write to Dominic Chopping at dominic.chopping@wsj.com

(END) Dow Jones Newswires

April 10, 2025 02:50 ET (06:50 GMT)

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