Porsche is accelerating a strategic realignment that will reshape its product portfolio, cost base and management structure as it seeks to restore margins and strengthen long-term profitability.
The German premium brand has reiterated its position after a difficult financial year, with group operating profit falling sharply in 2025 as the company absorbed nearly €3.9 billion (£3.4bn) in exceptional costs linked to its restructuring and product strategy reset.
Porsche first announced a change of direction in July last year, with an indication that it would be “refining its electric mobility strategy”, rolling back on some of its EV plans.
The strategy will see a stronger emphasis on higher-margin vehicles, a broader mix of powertrains and tighter control of volumes under the company’s “value over volume” philosophy.
Chief executive Dr Michael Leiters said: “We are using the current challenges as an opportunity to act even more decisively.
“We will comprehensively reposition Porsche, make the company leaner, faster and the products even more desirable.”
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The manufacturer is reviewing its product range as part of a new Strategy 2035 plan that could see the introduction of additional models and derivatives in higher-margin segments.
Leiters said the company is examining opportunities for vehicles positioned above its current two-door sports cars and above the Cayenne SUV.
Leiters said the brand would continue to focus on engineering led sports cars while maintaining flexibility across different powertrain technologies.
The company will continue to develop a mix of combustion, hybrid and battery electric models. In late 2025 Porsche introduced the new 911 Turbo S featuring a bi turbo powertrain with T Hybrid technology, while the all-electric Cayenne (pictured below) also made its world debut.
The electric SUV will sit alongside existing combustion engine and plug in hybrid versions of the Cayenne, reflecting Porsche’s multi-powertrain strategy.
The previous strategy was to have eight out of 10 new products to be fully EV by 2030.
ROS down to 1.1%
Financial results underline the scale of the challenge facing the business.
Porsche reported group sales revenue of €36.27bn (£31.3bn) in 2025, down from €40.08bn (£34.6bn) the previous year.
Operating profit fell from €5.64bn (5bn) in 2024 to €413 million (£357m) in 2025, with the operating return on sales (ROS) dropping to 1.1% from 14.1%.
Deliveries to customers also declined by 10.1% to 279,449 vehicles, although this might not be seen as a negative if there’s a realignment away from volume.
Restructuring will continue to hit financial performance
Chief financial officer Jochen Breckner said the restructuring would continue to affect financial results in the near term.
Breckner said: “The global challenges and the company’s realignment impacted earnings in 2025.
“In 2026, our recalibration measures will continue to have one off effects on earnings in the high three digit million euros range.
“In order to secure adequate margins by Porsche standards in the medium term and strengthen our resilience in the long term, we accept these burdens.”
Despite the downturn in earnings, Porsche said its balance sheet remains strong, supported by high net liquidity that provides flexibility to continue investing in its future product portfolio.
For 2026, the company expects market conditions to remain challenging, particularly in China where competition in the luxury EV segment has intensified.
The carmaker forecasts group operating return on sales of between 5.5 and 7.5% and sales revenue of around €35bn (£30.2bn) to €36bn (£31.1bn) for the year.