Porsche SE plans defense investments as H1 earnings decline

Porsche Automobil Holding SE (Porsche SE) reported an adjusted group result after tax of €1.1 billion for the first half of 2025, down from €2.1 billion in the same period last year. The decline was largely due to lower contributions from its equity stakes in Volkswagen AG (€1.2 billion) and Porsche AG (€0.1 billion). The group result after tax fell to €0.3 billion, compared to €2.1 billion a year earlier.

The company reduced its net debt to €4.9 billion from €5.2 billion at the end of 2024 and strengthened its financing profile with a €1.5 billion Schuldschein loan issue, which was significantly oversubscribed. The loan includes tranches of three, five and seven years at both fixed and variable rates.

Porsche SE revised its full-year adjusted group result after tax forecast to between €1.6 billion and €3.6 billion, from a previous range of €2.4 billion to €4.4 billion. It expects year-end net debt to be between €4.9 billion and €5.4 billion.

Shift Toward Defense and Security Investments

Chairman Hans Dieter Pötsch said the company aims to increase its exposure to the defense and defense-related sectors while keeping its core focus on mobility and industrial technology. The shift is driven by changing geopolitical conditions and increased security requirements in Europe.

Porsche SE plans to establish a platform for investing in emerging defense technology companies, potentially in partnership with other investors. It also intends to host a “Defense Day” to connect German and European family offices interested in the sector.

The company is already active in dual-use technologies through investments in Isar Aerospace and Quantum Systems, and is exploring opportunities in satellite surveillance, reconnaissance and sensor systems, cybersecurity and logistics.

Given Porsche SE’s significant stake in Volkswagen, developments within the automaker could play a role in its broader diversification strategy. Volkswagen has been assessing future options for its Osnabrueck factory, including potential conversion to military production.

Rheinmetall CEO Armin Papperger has identified the site as a suitable candidate, contingent on substantial defense orders. Such a move would reflect the growing overlap between the automotive and defense sectors in Europe and could indirectly complement Porsche SE’s planned expansion into defense-related investments.