Swedish truckmaker Volvo reported a sharper-than-expected decline in fourth-quarter operating profit on Wednesday as lower sales and higher costs weighed on margins. However, the company saw a strong rebound in order intake, particularly in Europe and North America.
Volvo’s operating profit fell to 14.04 billion crowns ($1.28 billion) from 16.98 billion a year earlier, missing analysts’ expectations of 14.51 billion, according to an LSEG poll. The decline was driven by weaker sales volumes and ongoing investments, with additional costs in North America related to supply chain challenges, the company said.
Despite the profit decline, orders rose 24% to 61,200 trucks, with Europe seeing a 37% increase and North America up 26%. Handelsbanken analyst Hampus Engellau described the order intake as “surprisingly strong.”
“Orders are clearly better,” Engellau said. “We’re starting to see replacement-driven orders in Europe, so I think that bodes well for this year for those who have been worried about Europe.”
See also: Volvo Trucks Introduces Electric Low-Entry Truck for Urban Transport
Volvo reiterated its market forecast for 2025, expecting sales of 290,000 heavy trucks in Europe and 300,000 in North America. The company also proposed an ordinary dividend of 8.00 crowns per share for 2024, up from 7.50 crowns in 2023, along with an unchanged extra dividend of 10.50 crowns.
Volvo is the first major European truckmaker to release fourth-quarter results, with competitors Traton and Daimler scheduled to report earnings in March.