Geely-owned Volvo Cars has disclosed a significant one-off non-cash impairment charge of Skr11.4bn ($1.19bn) for the second quarter (Q2) of 2025, attributed to financial adjustments for its EX90 and ES90 platforms.
The charge is a result of earlier launch delays and new import tariffs affecting profitability in key markets.
Despite an upgrade in software quality and a volume ramp-up plan, the Volvo EX90 will face decreased lifecycle profitability due to past launch delays and added development expenses.
The US market poses a profitability challenge for the Volvo ES90, with import tariffs making sales unviable, while margins in Europe are similarly affected.
The impairment charge will primarily affect expected volumes and planned lifecycle profitability for the EX90 and ES90 platforms.
Of the total, Skr4.0bn is estimated to affect cost of sales, with most of the remaining amount affecting the research and development (R&D) line in the financial reporting.
The group's net income will see an effect of Skr9.0bn, which is said to be reported in the Q2 results on 17 July 2025.
Volvo Cars chief financial officer Fredrik Hansson said: “The development of the EX90 and ES90 has laid a critical technological foundation for our future, with the Volvo Cars Superset tech stack.
“The learnings and core systems we developed, including core computing and electric drivelines, will be used in next-generation platforms. These innovations are key to realising our long-term electrification and software-defined vehicle strategy, putting Volvo Cars at the technological forefront of the auto industry.”
Despite these financial adjustments, Volvo Cars said that it will continue to invest in its “next-generation” dedicated electric car architecture and software capabilities. The upcoming all-electric Volvo EX60 is on track for a 2026 launch.
EX60 is expected to bring cost minimisations and performance improvements through mega-casting, cell-to-body technology, and e-motors.
In March 2025, Volvo Cars revealed the ES90 electric sedan, which combines fastback and SUV elements with 800V technology, expanding its premium car portfolio.
