Revenue and Profit Decline as Market Conditions Weaken
In its full-year 2024 financial report, Volvo posted net sales of SEK 526.8 billion (€45.98 billion), down from SEK 552.3 billion (€48.20 billion) in 2023. The company attributed the decline primarily to falling truck demand in Europe.
Adjusted operating income for 2024 dropped to SEK 65.7 billion (€5.73 billion) from SEK 78.2 billion (€6.82 billion) in 2023.
In Q4 2024, net sales decreased by 6%, reaching SEK 138.4 billion (€12.08 billion) compared to SEK 148 billion (€12.91 billion) in Q4 2023. Adjusted operating income also fell, landing at SEK 14.0 billion (€1.22 billion), down from SEK 18.5 billion (€1.61 billion) in the previous year’s fourth quarter.
The decline was driven by weaker freight and construction activity in key markets after several years of strong growth. Ongoing inflation and geopolitical instability also contributed to the company’s lower earnings.
Investments in Innovation and Strategic Adjustments
Despite the slowdown, Volvo Group continued investing heavily in research and development (R&D).
CEO Martin Lundstedt highlighted that 2024 was a pivotal year for the company, marked by major product launches and significant R&D expenditures, especially in the fourth quarter.
“We will continue our push to innovate but expect gross R&D in 2025 to stabilize slightly above 2024 levels,” Lundstedt stated.
Volvo Group is also streamlining its portfolio to strengthen its core business and expanding strategic partnerships to support the shift toward more efficient and carbon-neutral solutions.
To maintain shareholder confidence, Volvo announced an ordinary dividend of SEK 8.00 (€0.70) per share and an extra dividend of SEK 10.50 (€0.92) per share.
Volvo Cars Takes Full Control of NOVO Energy AB
In a separate move, Volvo Cars confirmed that it has acquired Northvolt AB’s stake in their joint venture, NOVO Energy AB, gaining full ownership of the battery production project in Gothenburg, Sweden.
The company had previously announced in October that it needed a new partner to keep the project on schedule. The financial terms of the acquisition remain undisclosed, and the transaction is pending regulatory approval.
Northvolt AB, which has been struggling financially, has been offloading non-core assets and joint ventures as part of a broader restructuring effort. However, Volvo Cars and Northvolt have signed a framework agreement to explore potential collaboration opportunities in North America.
Future Outlook
Despite economic headwinds and lower sales, Volvo Group remains committed to technological advancements and sustainability initiatives. With a strong emphasis on R&D and strategic business restructuring, the company is positioning itself to adapt to changing market conditions while continuing its transition toward greener, more efficient mobility solutions.