Merecedes-Benz Group has cut its profit guidance for the 2026 financial year as it warned of a “more challenging market environment in China and higher fourth quarter costs for raw materials and product lifecycle measures”.

For Mercedes-Benz Cars, the company now expects an adjusted return on sales of 2-3% (previously 3-5%).

It said group revenue for the year is expected at €132.2bn, slightly below the previous year, while 2026 earnings (EBIT) are projected at the previous year level, €5,8bn (but were previously forecast to be 15% higher).

Mercedes-Benz Group AG reported revenue of €30.7 billion in the third quarter of 2026 (Q3 2025: €32.1 billion), Group EBIT of €1.77 billion (Q3 2025: €0.75 billion) and net profit of €1.52 billion (Q3 2025: €1.19 billion). Adjusted Group EBIT decreased by 15% to €1.78 billion (Q3 2025: €2.10 billion).

Currency headwinds and a more challenging market environment in China, including further intensifying competition, weighed on the results, the company said.

Ola Källenius, Chairman of the Board of Management of Mercedes-Benz Group AG, said: “Market conditions have become even more challenging over the course of the year, particularly in China. Consistent cost discipline and strong contributions from Mercedes-Benz Vans and Mercedes-Benz Financial Services help us counter these headwinds.

“Our strong balance sheet allows us to keep investing in our future. With more product launches ahead and AI changing the way we work, we are focused on building a faster, more efficient and even more competitive Mercedes-Benz.”