- Swedish carmaker Volvo Cars said it cut its fourth-quarter 2021 net profit by 56% and revenue by 6.1% amid a shortage of components.
The company reported net income of SEK 2.12 billion ($230.6 million) in October-December compared to SEK 4.83 billion a year earlier. Volvo’s quarterly revenue fell to SEK 80.08 billion from SEK 85.3 billion in the same period last year.
Analysts polled by FactSet had expected Volvo to post a net profit of SEK 2.8 billion on revenue of SEK 75.11 billion.
Gross margin, however, increased to 20.7% from 18.6% due to higher vehicle prices.
Volvo attributed the drop in revenue and profit to problems in its supply chain and shortages of some components, particularly microchips. The company expects these factors to continue to have a limiting effect on growth as the global chip shortage extends through 2022. Nevertheless, Volvo expects to grow sales volumes due to strong demand for the company’s vehicles.
“We forecast strong customer demand and expect the market share of electric cars to grow faster,” said Volvo CEO Håkan Samuelsson.
At the same time, the company’s 2021 revenue of 282 billion kroner was an all-time record for Volvo, up from 262.8 billion kroner in 2020.
Swedish carmaker and military equipment maker Saab AB also reported a 4.4% drop in fourth-quarter revenue, to 11.94 billion kronor, due to component supply problems.
However, the company’s quarterly net profit rose to EEK 733 million from EEK 598 million a year earlier. FactSet experts had forecast net profit for Saab at 718 million kroner on revenue of 11.6 billion kroner.
The company plans to increase its dividend for 2021 to 4.9 kroner from 4.7 kroner in 2020.