Business
Amplifon trims margin forecast as higher marketing costs weigh
Published by Jessica Weisman-Pitts
Posted on October 30, 2024
2 min readLast updated: January 29, 2026
Global Banking & Finance Review®
Company
Published by Jessica Weisman-Pitts
Posted on October 30, 2024
2 min readLast updated: January 29, 2026
(Reuters) -Italian hearing aid company Amplifon slightly lowered its annual margin guidance on Wednesday, after the metric was hit by higher marketing costs in Europe in the third quarter.
(Reuters) -Italian hearing aid company Amplifon slightly lowered its annual margin guidance on Wednesday, after the metric was hit by higher marketing costs in Europe in the third quarter.
The company said it expected its recurring core profit margin to be broadly in line with 2023, when it posted a margin of 24%. It had previously forecast a margin of around 24.3% for this year.
Its third-quarter core profit margin was 20.3% of revenue, down 40 basis points from last year due to lower operating leverage and higher marketing investments to overcome market softness in the Europe, Middle East and Africa (EMEA) region.
Revenue grew 8% at constant exchange rates to 567.6 million euros ($613.75 million), driven by a 15.3% rise in the Americas, Amplifon’s second biggest market that generates about 22% of its total sales.
Its biggest market, EMEA, saw slower 3.8% revenue growth due to a “still soft European market“, Amplifon said.
“We continued along our revenue growth path thanks to an above-market organic performance and the significant contribution of acquisitions,” CEO Enrico Vita said in the statement.
However, recurring net profit slumped 25.5% to 17.5 million euros due to increased financial expenses and higher depreciation and amortization following acquisitions.
Shares in Amplifon were down 2.9% at 1300 GMT, little changed from before the report was published.
Tech-driven competition in the hearing aid sector is intensifying after Switzeland’s Sonova launched a first-in-market hearing device utilising real-time AI, and Apple received U.S. approval for software that it said could transform its headphones into a personalized hearing aid.
Analysts have however said that Apple’s move was not a concern for hearing aid players as over-the-counter devices target different population than prescription-based aids.
The Milan-based company confirmed its full-year revenue guidance for high single-digit percentage growth at constant exchange rates.
($1 = 0.9248 euros)
(Reporting by Alberto Chiumento in Gdansk; editing by Milla Nissi)
A profit margin is a financial metric that shows the percentage of revenue that exceeds the costs of goods sold. It indicates how efficiently a company is managing its expenses.
Recurring net profit refers to the income a company earns from its regular operations after all expenses, taxes, and costs have been deducted. It reflects the company's ongoing profitability.
Operating leverage is a financial concept that measures the proportion of fixed costs in a company's cost structure. Higher operating leverage means that a company can increase profits more significantly with rising sales.
Revenue growth refers to the increase in a company's sales over a specific period, often expressed as a percentage. It indicates how well a company is expanding its business.
Market softness refers to a period when demand for products or services declines, leading to reduced sales and revenue. It can be caused by various factors, including economic downturns.
Explore more articles in the Business category
