Conti reports decline in results, eyes improvement on ‘premium tire growth’

Hanover, Germany – Continental AG expects higher year-on-year earnings but lower sales in 2026 amid what it described as a continued “volatile” market environment.

The growth will be supported by “strong growth” in 18-inch-plus ‘premium tires,’ easing raw material costs and a projected “recovery in industrial markets in the second half of the year”.

The German group forecasts consolidated sales of €17.3 billion to €18.9 billion in 2026, with an adjusted EBIT margin of 11.0-12.5%.

For 2025, Continental generated group sales of €19.7 billion, down 2.0% year-on-year, with organic sales up 0.8%.

Earnings (EBITDA) fell 41% year-on-year to €1.8 billion, while operating results (EBIT) drastically declined to €272 million, from €2 billion reported in 2024.

Adjusted EBIT came in 8% below the prior year at €2.0 billion, with margins down to 10.3%, compared with 11.0% a year earlier.

Tires division delivered sales of €13.8 billion, slightly down from the year before, while earnings fell 2.5% to €2.6 billion.

Adjusted EBIT dropped 1.8% year-on-year to €56 million with a stable margin of 13.6%, reflecting “considerable burdens” from tariffs and exchange-rate effects.

The segment benefited from the rising share of ultra-high-performance products during the year with tires measuring '18 inches and higher' accounted for 62% of Continental-branded passenger-car tire sales, up from 60% in 2024.

The group said the business was “particularly strong” in the fourth quarter, supported by winter tire demand in Europe.

ContiTech reported 2025 sales of €6.0 billion, down 6.0%, with earnings down 65% to €195 million and an adjusted EBIT margin of 5.3%.

The division, which is being prepared for sale, was affected by “weak global industrial demand.”

Continental said measures to safeguard earnings at ContiTech would “mostly take effect from 2026 onward”, with a target of generating annual savings of €150 million from 2028, primarily in administrative structures.

Commenting on the results, group CEO Christian Koetz said the group had “achieved our targets” and reached key milestones in its realignment, including the spin-off of Aumovio and the sale of OESL.

“With the planned sale of ContiTech and Continental’s focus on the tire business, we’re entering the final stage of our strategic realignment,” Koetz said 4 March.

For 2026, Continental said it expects global replacement passenger-car tire volumes to develop in a range of -1% to +2% in 2026, while global light vehicle production is forecast at -2% to 0%.

The Tires group sector is projected to generate sales of €13.2-14.2 billion with an adjusted EBIT margin of 13.0-14.5%.

ContiTech is projected to post sales of €4.2-4.8 billion and an adjusted EBIT margin of 7.0-8.5%.

Capital expenditure before financial investments is forecast at around 7% of sales.

Continental noted that its current outlook does not take into account potential effects from the military conflict in the Middle East.