German automobile manufacturer Volkswagen reported a smaller profit in the second quarter, but still performed better than expected given the challenges at some of its major brands.
Operating profit decreased by 2.4% to €5.46 billion ($5.9 billion). Analysts had on average anticipated a larger decline. Revenue increased by 4.1% to €83.3 billion due to the strong performance of financial services, despite lower sales in the second quarter. However, profit fell by 4.2% to €3.63 billion.
The company saw declines in at key profit makers Porsche and Audi. It was also significantly impacted by the costs of job cuts at the core VW passenger car brand - the company has already set aside €0.9 billion for this.
Special expenses of around €1.7 billion for the possible closure of the Audi plant in Brussels are expected to follow in the current third quarter. The Wolfsburg-based company had lowered its earnings forecast for the full year at the beginning of July. The management team led by CEO Oliver Blume confirmed the outlook.
Vehicle sales were 4.3 million in the first half of the year, down 2% from last year. VW said growth in North and South America nearly offset declines in other regions, particularly China.
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