Investing.com -- German automaker Volkswagen AG (OTC: VWAGY ) reported Wednesday a 3% increase in sales to 78 billion euros ($85.32 billion) in the first quarter of 2025, compared to 75.5 billion euros in the same period last year.

The company’s operating result, however, decreased to around 2.8 billion euros, compared to 4.6 billion euros in the first quarter of 2024. The drop in operating result was due to special effects totaling approximately 1.1 billion euros. Consequently, the operating return on sales was around 3.6%, down from 6.0% the previous year.

The first quarter results of 2025 deviate significantly from the market expectation of around 4 billion euros or around 5 percent. The following factors had a notable negative impact in the quarter: around 0.6 billion euros from provisions related to CO2 regulation in Europe, around 0.2 billion euros for restructuring measures at CARIAD, and a total of around 0.3 billion euros from adjustments to provisions for the diesel issue and from the valuation of vehicles in transit in connection with the US import duties introduced at the beginning of April.

As of March 31, 2025, the net liquidity in the Automotive Division was around 33 billion euros, down from 34.4 billion euros as of December 31, 2024.

Despite the challenges, Volkswagen AG maintains its outlook for the 2025 financial year, as outlined in the 2024 annual report. The company continues to anticipate sales revenue to exceed the previous year by up to 5 percent. The Group’s operating return on sales is still expected to be between 5.5 and 6.5 percent. The net cash flow in the Automotive Division is projected to be in the range of 2 to 5 billion euros, with net liquidity expected to range between 34 and 37 billion euros in 2025.

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