MARKET INSIDER – Shares of luxury carmaker Ferrari suffered their worst trading day on record Thursday after the company released new financial targets that fell short of analyst expectations and announced a significant pivot away from its prior electrification goals.
The Maranello, Italy-based sports car manufacturer tumbled on both European and U.S. exchanges following its Capital Markets Day (CMD) event. Ferrari’s Milan-listed stock initially dropped 16.1%, before paring losses to close down 15.4% at 354 euros—the steepest single-day decline since the automaker listed in early 2016. U.S.-listed shares on the New York Stock Exchange mirrored the decline, closing down 15% at $407.38 apiece, surpassing the stock’s previous largest single-day drop of 12.4% in February 2016.
Financial Targets Underwhelm
At its CMD event, Ferrari updated its financial outlook, projecting net revenue of at least €7.1 billion ($10.7 billion) this year, a modest increase from its previous forecast of more than €7 billion. However, the long-term guidance proved to be the catalyst for the sell-off. The company is targeting net revenue of around €9 billion and earnings before interest, taxes, depreciation and amortization (EBITDA) of at least €3.6 billion by 2030.
Analysts swiftly registered their disappointment. Citi analysts noted in a research brief that the guidance “falls below our ‘lower growth case’ estimates” and likely “reflects conservatism from management.” They warned that the conservative outlook “implies limited operating leverage through the coming cycle,” posing a “risk to both consensus EPS and multiples near-term.”
Electrification Targets Scaled Back
Compounding investor concerns, Ferrari also revised its 2030 sports car model lineup to significantly temper its electric ambitions. The new target mandates a mix of 40% internal combustion engine (ICE) cars, 40% hybrid vehicles, and just 20% fully electric vehicles. This marks a sharp decline from its previous goal of 40% EV sales by the end of the decade.
The company justified the revised plan by citing a “client-centric approach,” the “current environment,” and its “expected evolution.” This shift comes amid a broader industry trend, where global carmakers like Sweden’s Volvo Cars have also recently scaled back EV sales targets, citing challenges such as a slower rollout of charging infrastructure and intense competition.
Despite the pivot, Ferrari provided an update on its EV program, unveiling the production-ready chassis and powertrain for its maiden electric vehicle, the “elettrica.” Deliveries for the model are slated to begin in late 2026, following a global premiere next year.
“With the new Ferrari elettrica, we once again affirm our will to progress by uniting the discipline of technology, the creativity of design and the craft of manufacturing,” said John Elkann, executive chairman of Ferrari.
Long-Term Growth and Bullish View
On the non-financial front, Ferrari reported that its current number of active clients has grown by 20% compared with 2022, reaching 90,000. It also plans to launch an average of four new cars per year between 2026 and 2030.
While many investors reacted negatively to the guidance, some analysts maintained a bullish stance on the iconic brand’s future. Analysts at JPMorgan expressed “great deal of confidence in management’s ability to execute on its long-term plan,” citing “ample evidence that demand currently far outstrips supply.” They also pointed out that an “imminent Supercar launch may also have the potential to turbocharge profits.”
