Michelin reports steep decline in full-year earnings

Clermont-Ferrand, France – Group Michelin has posted a 19.5% year-on-year decline in earnings (segment operating income) to €2,719 million on 2025 sales down 4.4% at €25,992 million.

Low manufacturing capacity-utilisation rates and currency effects offset sales-mix and operational gains, the group explained in a 12 Feb results announcement.

Tire sales volumes fell 4.7%, with over 80% of the decline linked to OE markets, particularly for truck and agricultural machinery tires in North America, said the French group.

In the replacement segment, sales of Michelin-brand tires “rose slightly" year-on-year, while the group's other brands were "penalised by distributors' massive stocking of low-priced tires.”

Non-tire businesses – Michelin Connected Fleet, Polymer Composite Solutions and Lifestyle – “contributed positively” to both sales and operating income, the statement continued.

During 2025, Michelin said it strengthened its ‘fundamentals’ by aligning manufacturing capacity to market conditions and improving operating performance as well as via portfolio development and brand-leverage.

Within the group's automotive & two-wheel (RS1) category, operating margin came in at 11.7%, impacted by lower sales volumes for OE and for the group's tier 2 and tier 3 brands.

The RS1 sales-mix improved, with the proportion of 18-inch+ tires rising to 68% of Michelin-brand passenger car tire sales, while replacement sales were supported by the new Primacy and CrossClimate ranges.

Across Michelin’s road transportation (RS2) category, operating margin narrowed to 4.7%, on weak OE sales in North America, in a market that shrank by 20% on "massive" stockpiling of trucks.

In response to the issues in the road transportation segment, Michelin said it is adjusting industrial capacity, accelerating renewal of product ranges, and promoting connected solutions.

Michelin’s specialties (RS3) category, meanwhile, delivered an operating margin of 13.5%, reflecting “bottom-of-cycle trends” in OE agricultural markets, partly offset by substantial growth in demand for mining and aircraft tires.

“In 2025, several markets where the group operates were affected by heightened competition, new and very unstable customs tariffs, and an unfavourable regulatory environment,” summarised managing chairman Florent Menegaux.

Nevertheless, Michelin “strengthened its financial position, continued to adapt our industrial capacities, and accelerated our product plan,” said Menegaux, who also highlighted acquisition-led growth in non-tire activities, particularly Polymer Composite Solutions.

With regard to the outlook for 2026, Michelin expects tire markets to “contract slightly” over the first six months, followed by a relative improvement in the B2B OE markets in the six months to December.

Also, the group aims to accelerate growth at its Polymer Composite Solutions unit, which will form a new reporting segment in the group's financial communication as from the first quarter.