Why Ferrari Stock Hit the Brakes This Week
Key Points
Ferrari said its 2030 revenue will be 9 million euros, which is lower than analysts were estimating.
The company unveiled some tech from its first electric car, but also scaled back its future EV ambitions.
Investors weren't happy with Ferrari's guidance and sent shares tumbling this week.
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Shares of the luxury automaker Ferrari (NYSE: RACE) spun out this week after management updated its full-year and 2030 guidance. While the company estimates 2025 revenue will be slightly higher than previously estimated, management's 2030 revenue outlook was below Wall Street's estimates.
As a result, Ferrari's stock fell 15% on Thursday -- its worst trading day ever and was down by 18.2% over the past week, before the market opened Friday morning.
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Image source: Ferrari.
Ferrari's revenue guidance fails to rev up investors
Yesterday, Ferrari's management said at the company's Capital Markets Event that revenue will be at least 7.1 billion euros this year, a modest increase from the company's previous estimate of more than 7 billion euros for 2025.
But investors locked in on management's 2030 revenue outlook, which the company said would be around 9 billion euros in 2030. That was below Wall Street's consensus estimate of around 10 billion euros.
What's more, Ferrari said 2030's adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) would be 3.6 billion euros. RBC Capital pointed out that this represents a growth rate of 6% annually through 2030, below the 10% rate Ferrari projected three years ago.
A less-electrified future
Adding to investors' disappointment may also have been that Ferrari also separately announced that it was scaling back its electric vehicle plans.
Ferrari unveiled some of the technology for its first electric vehicle, the Elettrica, yesterday, yet management said that just 20% of its vehicles will be EVs in 2030 -- instead of the 40% it previously anticipated. Instead, hybrids and ICE powertrains will continue to dominate, with each accounting for 40% of the company's models in 2030. Deliveries for the Elettrica will begin in late 2026.
Ferrari's lower-than-expected 2030 revenue guidance, lackluster EBITDA growth projections, and a shifting EV strategy didn't thrill shareholders this week. Investors will get more insights into how the luxury automaker is doing when it reports third-quarter results next month.
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Chris Neiger has no position in any of the stocks mentioned. The Motley Fool recommends Ferrari. The Motley Fool has a disclosure policy.
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