BMW’s strong Q2 earnings are dampened by growing scarcity of semiconductor chips

 BMW’s strong Q2 earnings are dampened by growing scarcity of semiconductor chips

BMW’s strong Q2 earnings are dampened by growing scarcity of semiconductor chips.

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On Tuesday, BMW raised its profit forecast for 2021 following strong quarter-end results but warned that a global shortage of semiconductor chips and rising raw materials prices would harm its results.

For the quarter, BMW’s net profit was 4.8 billion euros ($5.7 billion), versus a loss of 212 million euros for the same period in 2020. Approximately 2.2 billion euros in net income was expected by analysts according to Refinitiv estimates for the second quarter.

The luxury carmaker further disclosed it now anticipated a full-year operating margin for the automotive segment in a range from 7% to 9%, up from its previous forecast of a range from 6% to 8%.

A year ago, the German carmaker suffered a loss due to a pandemic induced by the coronavirus. This year, the luxury automaker posted a profit that was better than expected.

During the first six months, we achieved significant growth thanks to strong customer demand, Chief Executive Oliver Zipse told investors in a statement.

Despite this, the second half of the BMW Group’s financial year is likely to be more volatile due to factors such as raw material prices and a chip shortage.

A string of EU investigations into collusion that regulators say slowed the rollout of emissions-cleaning technology led to a fine last month of 373 million euros for the German carmaker. A total of 1.4 billion euros had been set aside by BMW.

Olumide Adesina

Olumide Adesina a France-born Nigerian, a Certified Investment Trader, with more than a decade of working expertise in Investment and Trading. He is also a reputable author and writer for CoinDesk and FxEmpire.

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