Ferrari NV Q3 FY2026 earnings call

• Brand Strength: Ferrari climbed three places in Interbrand's Best Global Brands 2026, remaining the most valuable Italian brand.
• Sports Cars: Strong momentum with the launch of the 12 Cilindri Manuale and GT3 Modificata. The new 'Luce' model has fully allocated deliveries for 2027, with first deliveries expected in Q4 2026. Order books remain healthy across all geographies.
• Racing: Historic success in Formula 1 with Kimi Antonelli becoming World Champion. Ferrari holds second place in the championship. Sailing venture is progressing with the monohull entering final construction.
• Lifestyle: New flagship store opening in New York planned for Q1 2027 following London. Sketch Body collectible project sold out for the next year.
• Dealer Network: Global rollout of new corporate identity continuing, with recent openings in Zug, Pasadena, and Riyadh.
• Operational Execution: Model changeover proceeding smoothly; Amalfi and 296 Speciale entering global distribution phase.

Net revenues increased by approximately 10% at constant currency and 7% including foreign exchange headwinds, reaching €1.9 billion. EBIT grew double-digit to above €560 million. Industrial free cash flow exceeded €565 million. Revenue growth was primarily driven by a richer product mix (F80, 849 Testarossa, 12-cylinder families) and high personalization rates, which surpassed 21% of total car and spare parts revenue. Sponsorship and commercial revenues also contributed positively, while lower Formula One ranking costs provided tailwinds.

• Revenue: Upgraded full-year guidance, expecting stronger contribution from personalizations in Q4 aligned with Q3 trends.
• FX Assumptions: Assumes an improved US dollar to euro exchange rate compared to Q3, with a blended spot and hedged rate assumption of approximately 1.15+ for both 2026 and 2027.
• Costs: Expects lower Formula One costs due to current second-place championship standing.
• Personalization: Maintains expectation that the annual personalization rate will be consistent with recent months, avoiding further extension beyond current levels.
• Volume: No adjustment to volume guidance; growth relies on favorable year-over-year comparisons and ASP improvements.

• Foreign Exchange Volatility: Continued negative variance from prior year edges remains a headwind, though spot rates are becoming more favorable.
• Supply Chain Constraints: Past carbon fiber shortages have been mitigated through contracts, but supply dependencies remain a monitoring point.
• Formula One Budget Cap: R&D expenses related to F1 are dictated by evolving budget caps, representing a less controllable cost driver.
• Model Changeover: Deliberate reduction in shipments during the quarter to facilitate smooth completion of the model changeover process.

Q: Analyst asked about F80 shipment volumes, F1 provision releases, and FX impact. / A: CFO stated F80 shipments were around 50 units, consistent with slight sequential growth. F1 championship provision release is not material (few millions) and already adjusted in Q3. FX impact is estimated between €150-200 million over four years, lower than initial €200 million estimate due to favorable spot rates.

Q: Analyst asked about Q4 shipment trends, country mix, and China performance. / A: CEO confirmed Q4 shipments will increase year-over-year, aided by the end of the model changeover and favorable base effects. China’s decline was specifically attributed to the model changeover. Country mix is improving as models approach global distribution, and personalization data is now fully defined for year-end.

Q: Analyst questioned revenue growth acceleration drivers, high special series share, and FX assumptions. / A: CFO clarified that volume guidance was unchanged; revenue growth stems from slightly higher ASPs in H2 vs H1 and favorable mix. The high personalization rate (22%) is due to a concentration of special series this year, which is expected to normalize. FX assumption remains ~1.15+ blended for 2026 and 2027.

Q: Analyst asked about Luce order allocation geography/customer profile and ASP trends. / A: CEO noted Luce orders are fully allocated for 2027, with deliveries starting late 2026. While specific customer splits aren't disclosed, there is a good geographic and demographic mix. Opportunities exist in markets where physical interaction enhances perception. ASP trend for next year will be discussed in February.

Q: Analyst asked why 2026 deviated from 'smooth/linear' guidance, residual values, and hybrid issues. / A: CFO explained deviations were due to higher-than-guided personalization (carbon supply no longer a bottleneck) and favorable FX rates vs. original 1.20 assumption. CEO highlighted that hybrid residual values are sound because dealers are better educating customers, and clients appreciate the hybrid technology. Demand remains healthy across all models.