Short Take: Qt Group Q2 sales slump amid auto tariff impact
06/08/2025 13:06
Aug 6 (Reuters) - Finnish car software provider Qt Group QTCOM.HE posted second-quarter net sales below analyst estimates on Wednesday amid trade tensions slowing its revenue growth. MARKET REACTION The company's shares fell 15%, hitting their lowest level in 1.5 years and were on track for their worst day since April. CONTEXT Qt Group makes software for, among others, the automotive industry, with its software being used in cars by Mercedes-Benz, Hyundai, Kia or Peugeot, according to its website. Its automotive business was the worst performer in this quarter, as Qt's customers dealt with their own issues and were more cautious about investments, the company said. WHY IT'S IMPORTANT European automakers have to navigate a new 15% tariff from the EU-U.S. agreement, lower than the previous 27.5% rate, yet still challenging for their export-driven operations. Car makers have been flagging weakness in the market. Norwegian Kongsberg Automotive KOA.OL said it would cut costs and reduce its workforce, Mercedes-Benz MBGn.DE cut its outlook and BMW BMWG.DE saw its profit drop in July. KEY QUOTES "For some Western companies, at the same time there are tariffs, they've been facing the fact that there is fierce competition in China," CEO Juha Varelius said in a conference call. BY THE NUMBERS The group posted second-quarter sales of 51.2 million euros ($59.27 million), missing the 55.7 million expected by LSEG-polled analysts. WHAT’S NEXT Qt will keep its full-year guidance unchanged, it said in its earnings statement. But Inderes analyst Antti Luiro added in a note that meeting its targets will require a rapid recovery in the market. "The situation may well require a new profit warning from the company later," he added. ($1 = 0.8639 euros) (Reporting by Vera Dvorakova; Editing by Matt Scuffham) ((vera.dvorakova@thomsonreuters.com))