Michelin profit hit by US slowdown, sees rebound in 2026

By Mathias de Rozario

Feb 11 (Reuters) - ‌Michelin expects profit ​to ​rebound this year after a decline in 2025 caused by a slowdown in the U.S., the French tyre maker said on Wednesday.

The ‌group forecast its segment operating income - the combined profit from its ⁠Automotive and Two-wheel, Road Transportation and Specialties divisions - to be above 2025's level in 2026.

Last year, ‌segment operating income fell more than ‌14% to 2.9 billion euros ($3.4 billion), beating analysts' 2.7-billion-euro forecast in a company-compiled consensus.

Sales fell 4.4% to 26 billion euros, also above the consensus estimate ​of 25.8 billion euros, with a 4.7% drop in tyre volumes less than the expected 4.9% decline.

"Overall, 80% of our decline in volume is due ⁠to original equipment, particularly B2B original equipment, meaning trucks. This is particularly pronounced in the United States and ​the agricultural sector," Chief Financial Officer Yves Chapot told reporters.

The group already warned in its third-quarter results of a decline in the ​North American truck market after the postponement ‌of U.S. vehicle emissions regulations and the impact of Chinese retaliatory measures on North American farmers' incomes.

Chapot added that the expected ⁠drop in sales volumes linked to the end of a contract with a major North American wholesaler on July 1 was fully behind the group by year-end.

North America is Michelin's ⁠biggest market. While it produces tyres locally, avoiding a direct hit from U.S. tariffs, the company ​saw a knock-on impact from higher raw material prices and weaker car sales after automakers raised prices and customers turned cautious.

The group recorded an impact of 230 million euros from ‌U.S. tariffs on its 2025 costs and expects around 120 million euros in 2026, Chapot said.

Michelin is maintaining its dividend at ‌last year's level of 1.38 euros per share, 10 cents above market expectations.

It also ⁠announced a 2.0-billion-euro share buyback programme ‌for 2026-2028, supported by ​strong cash generation, Chapot said.

($1 = 0.8434 euros)

(Reporting by Mathias de Rozario in Gdansk. Additional reporting from Gilles Guillaume in Paris. Editing by ‌Mark Potter)

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