Auto manufacturing giant Stellantis experienced a dramatic stock decline Thursday despite announcing that first-quarter profits had nearly tripled, as investors reacted negatively to concerning cash flow performance from the Franco-Italian automaker.
The financial results highlight the ongoing difficulties facing CEO Antonio Filosa, who took the helm last year with a mission to revitalize the company following multiple quarters of declining sales.
Filosa previously announced over 22 billion euros in writedowns this past February as the company pulled back from its electric vehicle goals. He is scheduled to present the organization’s updated long-term strategy on May 21.
The company’s adjusted earnings before interest and taxes climbed to 960 million euros during the first three months of the year, a significant jump from 327 million euros recorded in the same period last year.
However, company officials revealed that a February U.S. Supreme Court decision overturning certain tariffs implemented during the Trump administration contributed approximately 400 million euros to the results through anticipated refund payments.
Other major automakers also benefited from the tariff ruling, with General Motors and Ford announcing expected refunds of $500 million and $1.3 billion respectively earlier this week. Stellantis has revised its full-year U.S. tariff impact estimate to 1.3 billion euros, down from a previous projection of 1.6 billion euros.
Financial analysts at Bernstein noted that without the tariff refunds, Stellantis would have posted negative adjusted earnings in North America, a crucial market for the company. The region generated 263 million euros in adjusted earnings for the quarter.
Performance in Europe, another major market for Stellantis, showed adjusted earnings near zero, marking a steep decline from 292 million euros achieved in the prior year period.
The company’s industrial free cash flow remained deeply negative at more than 1.9 billion euros for the quarter, though this represented an improvement from the previous year’s cash burn exceeding 3 billion euros.
Analyst Michael Foundoukidis from Oddo BHF described the cash flow performance as “more negative than expected,” pointing out that the results included only 700 million euros in charges from a total of 1 billion euros anticipated for the full year.
“We maintain a cautious stance on Stellantis ahead of the Capital Markets Day scheduled for May 21,” Foundoukidis stated.
Despite the tariff relief, company leadership reaffirmed their 2026 projections issued earlier this year, including expectations for mid-single-digit percentage growth in net revenues and low-single-digit adjusted operating income margins. While industrial free cash flow is projected to improve compared to last year, the company doesn’t anticipate positive cash flow until 2027.
Stellantis shares traded on the Milan exchange fell 7.2% by 0840 GMT after dropping more than 10% at market opening.
These quarterly results represent the first time Stellantis has provided quarterly profit reporting since the company formed in early 2021 through the combination of Fiat Chrysler and PSA Group, the maker of Peugeot vehicles. Previously, the automaker had reported financial results on a semi-annual basis.
