Finance
Truckmaker Volvo flags improved outlook after quarterly profit drop
Published by Global Banking and Finance Review
Posted on January 28, 2026
2 min readLast updated: January 28, 2026
Quick Summary
Volvo Group's Q4 profit exceeded expectations with a proposed dividend of 14 Swedish crowns per share, despite a smaller than expected decline.
Volvo Group Adjusts Market Forecasts Despite Fourth-Quarter Profit Decline
Volvo Group's Market Forecast Adjustments
By Marie Mannes
Quarterly Profit Analysis
STOCKHOLM, Jan 28 (Reuters) - Volvo Group raised its forecasts for stabilising European and North American markets on Wednesday despite a drop in fourth-quarter profit that prompted a dividend cut.
Market Stabilization Insights
Profit continued to tumble as the sector contends with a more than three‑year slump in the United States owing to lower freight volumes in the face of policy and tariff uncertainty.
Analyst Reactions and Share Performance
"Over the last couple of months we have seen a stabilisation in several of our markets and in some cases even a slight improvement," CEO Martin Lundstedt said, adding that geopolitical developments could still curb demand.
The company said it now predicts that the North American heavy truck market in 2026 will be roughly flat year on year at 265,000 vehicles rather than the slightly weaker forecast of 250,000 made in October.
The market is expected to remain weak in the first half of 2026, it said, adding that the forecast was subject to a large degree of uncertainty.
For the European heavy truck market, it raised its forecast to 305,000 vehicles from the previous estimate of 295,000.
Handelsbanken analyst Hampus Engellau said the market was likely to take the report as broadly neutral, given the dividend cut was widely expected and countered by the better than forecast operating profit and improved outlook in Europe and North America.
Shares in the company rose by 2.7% in early trade.
Operating profit for the three months to December 31 was down 9% at 12.77 billion Swedish crowns ($1.45 billion), beating a mean forecast of 11.49 billion crowns in an LSEG poll of analysts.
($1 = 8.8028 Swedish crowns)
(Reporting by Marie MannesEditing by Terje Solsvik, Tom Hogue and David Goodman)
Key Takeaways
- •Volvo Group's Q4 operating profit exceeded forecasts.
- •The company proposed a dividend of 14 Swedish crowns per share.
- •The decline in profit was smaller than expected.
- •The financial performance was reported from Stockholm.
- •Marie Mannes reported and Terje Solsvik edited the article.
Frequently Asked Questions about Truckmaker Volvo flags improved outlook after quarterly profit drop
1What is operating profit?
Operating profit is the income generated from a company's core business operations, excluding deductions of interest and taxes. It reflects the efficiency of a company's operations.
2What is a dividend?
A dividend is a portion of a company's earnings distributed to shareholders, typically in cash or additional shares. It represents a return on investment for shareholders.
