BMW Q1 Profit Falls to €2.3B, Beats Expectations Despite China Headwinds

BMW reported a 26% drop in pretax earnings to €2.3 billion for the first quarter of 2026, yet the German automaker's core automotive margin of 8.5% surpassed analyst forecasts. The profit decline was driven by weakening demand in China, the company's largest single market, and the impact of newly imposed tariffs on European luxury vehicles. BMW's automotive segment revenue fell 4% to €32.1 billion, while overall group revenue declined 3% to €36.2 billion. The company maintained its full-year guidance for a moderate increase in deliveries and an automotive margin between 6% and 8%. CFO Walter Mertl stated that cost-cutting measures and strong pricing for high-end models partially offset the headwinds. BMW shares rose 2.3% in Frankfurt trading following the earnings release.