Key Moments
- Stellantis’ adjusted operating income nearly tripled to 960 million euros in the first quarter, significantly aided by anticipated U.S. tariff refunds of around 400 million euros.
- Industrial free cash flow was more than 1.9 billion euros negative in the quarter, which investors viewed as worse than expected despite improving from over 3 billion euros negative a year earlier.
- The company confirmed its 2026 outlook, with industrial free cash flow projected to turn positive only in 2027, and its shares were down 7.2% at 0840 GMT after falling more than 10% at the open.
Market Reaction and Leadership Context
Stellantis’ Milan-listed shares fell sharply after the group released its first-quarter results, with the stock sliding more than 10% at the market open and trading 7.2% lower at 0840 GMT. The market response reflected investor concern over cash generation, even as reported profitability improved.
The performance highlights the ongoing challenges for Chief Executive Antonio Filosa, who took over last year with a mandate to reinvigorate the automaker following several quarters of declining sales. In February, Filosa announced more than 22 billion euros in charges as Stellantis pulled back on its earlier electric-vehicle strategy. He is scheduled to present the company’s new long-term business plan on May 21.
Profit Lifted by U.S. Tariff Refunds
Adjusted earnings before interest and taxes (EBIT) for January to March increased to 960 million euros from 327 million euros in the same period a year earlier. The company said this result was heavily supported by a favorable development on U.S. trade policy.
According to Stellantis, a U.S. Supreme Court ruling in February that overturned some of President Donald Trump’s tariffs yielded a benefit of around 400 million euros in the quarter, based on expected refunds. Earlier in the week, peers General Motors and Ford disclosed expected tariff refunds of $500 million and $1.3 billion, respectively.
Stellantis now expects the full-year impact from U.S. tariffs to be 1.3 billion euros, down from a previous estimate of 1.6 billion euros.
Regional Performance: North America and Europe
In its core North American market, Stellantis generated adjusted EBIT of 263 million euros. Analysts at Bernstein noted in a client communication that this figure would have been negative without the contribution from tariff refunds.
In Europe, the company’s other main region, adjusted EBIT was described as almost zero, compared with 292 million euros in the prior-year period. This indicated a sharp deterioration in profitability in that market.
| Region / Metric | Q1 Current Year | Q1 Prior Year | Comment |
|---|---|---|---|
| Adjusted EBIT – Group | 960 million euros | 327 million euros | Supported by around 400 million euros in expected U.S. tariff refunds |
| Adjusted EBIT – North America | 263 million euros | Not stated | Would have been negative without tariff refunds, according to Bernstein |
| Adjusted EBIT – Europe | Almost zero | 292 million euros | Significant year-on-year decline |
Cash Flow Pressure and Analyst Views
Industrial free cash flow for the quarter was more than 1.9 billion euros negative. While this represented an improvement from a cash drain of over 3 billion euros in the same period last year, the figure fell short of expectations for some analysts.
Oddo BHF analyst Michael Foundoukidis described the cash outflow as “more negative than expected,” noting that it only reflected 700 million euros in charges out of a total of 1 billion euros anticipated for the full year. He added, “We maintain a cautious stance on Stellantis ahead of the Capital Markets Day scheduled for May 21.”
Guidance and Long-Term Cash Flow Outlook
Despite the easing impact from U.S. tariffs, Stellantis reaffirmed on Thursday the 2026 guidance it had laid out earlier in the year. The company continues to project a mid-single-digit percentage increase in net revenues and a low-single-digit adjusted operating income margin for that year.
Management expects industrial free cash flow to improve from last year’s level, but the group does not anticipate a return to positive industrial free cash flow until 2027.
Reporting Milestone Since Merger
The latest release represents the first time Stellantis has reported profit on a quarterly basis since it was formed in early 2021 through the merger of Fiat Chrysler and Peugeot parent PSA. Up to now, the company had disclosed profit figures on a half-year basis.
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