Ferrari N.V. , announced its fourth-quarter and full-year results, reporting record revenue and strong profitability despite ongoing supply chain headwinds. The luxury automaker demonstrated resilience through a combination of a favorable product mix, increased customization, and robust demand, particularly for its newest models.
Record Financial Performance in 2024
The Italian manufacturer reported approximately €6.7 billion in revenue for , representing double-digit growth compared to the previous year. Net profit reached €1.5 billion, and the company achieved an EBITDA margin of 38.3% and an EBIT margin of 28.3%. Diluted earnings per share (EPS) rose to €8.46, a 22.6% increase year-over-year. Notably, Ferrari generated industrial free cash flow exceeding €1 billion for the first time.
Capital expenditure for the year totaled approximately €990 million. Shipments increased by 89 units compared to . A significant driver of performance was the increasing proportion of hybrid vehicles, which accounted for 51% of total shipments. Personalization options, a key element of Ferrari’s brand strategy, contributed approximately 20% of revenues from cars and spare parts.
Strategic Model Launches and Product Mix
Ferrari successfully launched three new models in , including the highly anticipated supercar, the F80. The F80 exemplifies the company’s commitment to technology transfer from its racing division to its road-going sports cars. The richer product and country mix played a crucial role in bolstering financial results, as noted in an earnings call on .
The Purosangue, Ferrari’s first-ever four-door four-seat model, continues to demonstrate strong demand, with production intentionally constrained to maintain its exclusivity. This strategy, prioritizing scarcity over volume, is a hallmark of Ferrari’s business model and contributes to its high prices and consistent profitability.
Navigating Supply Chain Challenges and Electrification
Despite the positive results, Ferrari acknowledged ongoing challenges within the supply chain. The company noted that some suppliers are experiencing lower demand from larger original equipment manufacturers (OEMs), impacting their capacity and lead times. However, Ferrari’s strong brand and pricing power have allowed it to mitigate some of these effects.
Ferrari is also making significant strides in its electrification journey, with advancements in battery models and electric components being developed in-house at its Maranello facility. This commitment to in-house development underscores the company’s long-term vision for sustainable performance vehicles.
Financial Position and Outlook
As of , Ferrari’s net industrial debt stood at €180 million. The company anticipates a higher effective tax rate of around 22% in the coming periods.
Recent market performance has presented a mixed picture for Ferrari investors. While the company’s fundamentals remain strong, its stock price experienced a 17% decline over the three months leading up to , a period during which other major automakers saw their shares climb. This dip, however, may present a “buy-the-dip” opportunity for investors who recognize the company’s unique position in the luxury automotive market.
A Business Model Built on Scarcity
Ferrari’s success is rooted in a business model that diverges significantly from mass-market automakers. By prioritizing scarcity and exclusivity, the company maintains high prices, generates substantial backlogs, and insulates itself from the cyclical pressures that affect the broader automotive industry. This approach, coupled with its strong brand reputation and technological innovation, positions Ferrari for continued success in the years ahead.
The company’s ability to command premium prices and maintain consistent profitability, even in the face of economic uncertainty, is a testament to the enduring appeal of the Ferrari brand and the effectiveness of its strategic focus on luxury and performance.
