TLDR
- Stellantis stock experienced a significant drop of over 20% on Friday following the announcement of a substantial $26.5 billion writedown related to adjustments in its electric vehicle (EV) strategy.
- The automotive manufacturer anticipates a net loss ranging from $19 billion to $21 billion for the latter half of 2025 and has decided to suspend dividend payments for 2026.
- These writedowns are attributed to revised, lower projections for EV sales and modifications to the company’s product development plans to better align with customer preferences.
- As part of its restructuring efforts, Stellantis expects cash outflows totaling $6.5 billion over the next four years.
- The company is scheduled to release its full-year financial results on February 26, with management planning a conference call to discuss preliminary figures.
Stellantis shares plummeted by more than 20% during Friday’s trading session after the automaker delivered significant news to its investors. The company announced charges amounting to approximately $26.5 billion, which are connected to a scaling back of its electric vehicle initiatives.
Shares listed in Milan fell by as much as 24%, reaching €6.17, their lowest point since May 2020.
The shares traded in Paris declined by 23.9%. Trading was temporarily halted after an initial 14% decrease as the market processed the news.
If these losses are sustained, this would represent the largest single-day drop in the company’s history. The sell-off has erased over $5 billion from Stellantis’s market capitalization.
Shares of Exor, the holding company controlled by Italy’s Agnelli family and a major Stellantis shareholder, saw a decrease of nearly 5% in Amsterdam.
Massive Loss Coming
The Franco-Italian automaker forecasts a net loss between $19 billion and $21 billion for the second half of 2025, a figure largely driven by these restructuring charges.
According to company statements, the writedowns reflect “sharply lower assumptions for EV sales.” The majority of these charges stem from adjustments made to the product roadmap.
Stellantis indicated that it conducted a comprehensive review of its strategy to ensure alignment with “real-world preferences of its customers.” This suggests that consumer demand for EVs is not meeting the company’s earlier expectations.
The charges include approximately $6.5 billion in actual cash outflows that are expected over the next four years.
Dividend Axed, Bonds Planned
The company has decided to suspend its 2026 dividend entirely, stating that this measure is intended to safeguard the company’s financial position during this strategic reset.
Additionally, Stellantis plans to raise up to $5 billion through the issuance of hybrid bonds to help finance the restructuring process.
“The company has made the vast majority of the decisions necessary to correct its course,” Stellantis stated in its release, emphasizing the importance of “aligning our product plans and portfolio with market demand.”
For 2026, management has projected mid-single-digit revenue growth, with an expected low-single-digit improvement in the adjusted operating margin.
Worse Than Expected
Brokerage firm Equita noted that the writedown significantly exceeded initial expectations, which were estimated at over $2 billion. A trader based in Milan commented that the market was taken by surprise by the announcement, which was made prior to the release of the full-year results.
“The bill has come due,” the trader remarked. “The market tends to amplify everything, and it was surprised by the announcement of this data outside of the expected release.”
Jefferies analyst Philippe Houchois pointed out that Stellantis “announced significantly higher restructuring charges” and provided “loose 2026 guidance.”
The company’s stock has been under pressure for several years. Shares listed in Italy fell by nearly 25% in 2025, following a 40.5% decline the previous year. Year-to-date in 2026, the shares have dropped by more than 13%.
Stellantis’s CEO and finance chief are scheduled to host a conference call at 1300 GMT on Friday to discuss the preliminary results. The full-year financial report is slated for release on February 26.
