(Sharecast News) - Volvo Cars said it is gaining confidence in its outlook after an improvement in underlying sales trends over the second quarter, helped by signs of a US recovery and strong electric vehicle sales in Europe, though shares still fell sharply on Friday.
Revenues over the second quarter totalled SEK77.7bn, down from SEK93.5bn the year before, though operating income swung to a profit of SEK0.8bn from a SEK10.0bn loss previously. This was helped by the EBIT margin turning positive to 1.1% from -10.6%.

"In this very challenging external environment, we made progress on our strategic actions," said Håkan Samuelsson, president and chief executive.

In particular, the manufacturer said it delivered SEK5bn in targeted full-year cost savings six months ahead of schedule, on top of the SEK8bn saved on spending in 2025.

"These savings have been made possible because of structural changes in the company, including a reduced headcount of approximately 3,000 positions versus H1 2025," the company said.

Meanwhile, the US market was "showing signs of recovery, with Volvo Cars recording two consecutive months of growth in May and June. The firm had faced tough comparatives with previous years as incentives to buy electric cars in the US expired, though these negative effects should lessen in the second half.

In Europe, Volvo Cars' biggest market, the company said sales were "resilient" despite increased competition and a weaker pricing environment, with battery electric car sales jumping 23% year-on-year. BEV sales now account for 25% of total sales, up from 21% the year before.

"This gives us the momentum and confidence that the second half of the year will improve compared to the first six months."

Despite the bullish outlook, shares in the auto group slumped 9.3% to SEK19.18 in Stockholm.

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