Photo: A Boxer Skyranger 30 armored vehicle at ILA 2022 / Boevaya mashina, Wikimedia Commons / CC BY-SA 3.0
Rheinmetall shares fell as much as 17% in early trading Thursday, CNBC reported, after the German defense giant cut its full-year sales target for the second time since August, citing delayed military contracts. The drop leaves the stock down about 46% so far this year.
The company now expects 2026 sales of about 13.2 billion euros ($14.9 billion), down from a prior range of 13.7 billion to 14.2 billion euros, and an operating margin of about 18.5% instead of 19%. Rheinmetall blamed the revision on delays in the German military’s Arminius Boxer vehicle program, now expected to be commissioned in 2027, and setbacks in artillery ammunition acceptance testing.
Rheinmetall also said the Boxer delays push expected advance payments into 2027, which weighs on its target of converting more than 40% of results into cash, though it still expects positive operating free cash flow this year, CNBC reported. The company flagged delays in expected fourth-quarter revenue from new business activities, particularly its partnership with Dutch defense technology firm Destinus.
The guidance cut landed alongside improving quarterly results: third-quarter sales rose 32% from a year earlier to 3.15 billion euros, operating profit jumped 62% to 553 million euros, and new orders of 2.89 billion euros pushed the backlog to 78 billion euros. Citi analysts called it “a strong set of Q3 results,” while RBC analysts called the guidance cut “clearly negative” and warned it could feed worries about traditional defense technology, CNBC reported.
For investors, the message is that even a record order backlog does not guarantee smooth delivery: government paperwork and testing schedules, not demand, set the pace.
JBizNews Desk | Global
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