Executive Summary

INVESTMENT THESIS

Ferrari is evolving into an electrified, highly exclusive luxury brand-led by Luce as the new flagship and supported by disciplined growth and strong cash generation. The combination of Luce’s exclusivity, a broadened model cadence (7 new models in 2025–26, plus 4 launches in 2026), and a long-dated order book through 2027 underpins durable value creation, even as FX and ramp dynamics pose near-term margin headwinds.

KEY FINANCIAL HIGHLIGHTS

– 2025 revenue > EUR 7.1B; EBITDA 38.8%, EBIT 29.5% (robust profitability and operating leverage).

– Industrial free cash flow > EUR 1.5B, up ~50% YoY; strong cash generation underpins shareholder returns.

– Shareholder remuneration > EUR 1.3B (dividends and buybacks up ~30%).

– 2026: higher CapEx, broadly stable R&D; ~€200M FX headwind; tax rate ~23%; Luce deliveries start in Q4 2026 with a Rome world premiere in May and continued model introductions.

STRATEGIC INITIATIVES & CATALYSTS

– Luce as centerpiece: world premiere May 2026; Luce deliveries begin Q4 2026; exclusivity and selective distribution emphasized.

– Model cadence and mix: 7 new models 2025–26; 4 additional launches in 2026; stronger second-half product mix variance.

– Investment in brand and operations: new paint shop, Evo test track, e-Vortex testing; flagship stores in London and New York; ongoing digital transformation and enhanced lifestyle network.

– Growth geography and aftersales: rising spare parts revenue; India tariff improvements potential near-term growth.

RISK FACTORS & CONCERNS

– FX headwinds and 2026 margin trajectory (~€200M impact) despite hedging.

– Global macro uncertainty, regulatory/CO2 policies, and F1-related cost volatility.

– Operational risks from model changeovers, ramp timing (e.g., F80), and residual-value/used-car dynamics; tariffs in India.

– Execution risk around Luce timing and broader 2026 model launches.

ANALYST SENTIMENT & MANAGEMENT TONE

Management projects disciplined, linear growth with clear long-term clarity toward 2030; Luce is a strategic, exclusive bet that reinforces brand value, underpinned by a strong order book and visible ramp through 2027.

BOTTOM LINE

Ferrari’s electrification-led, exclusivity-driven strategy should deliver durable growth and strong shareholder returns, backed by robust cash flow and a clear 2026/2030 roadmap. Key monitoring points: Luce delivery timing, FX impact, and model-ramp execution. Recommend constructive exposure with emphasis on hedging discipline and cadence adherence.

Financial Metrics

Forward Looking Analysis

## Forward-Looking Statements and Guidance

– Guidance for the upcoming year (2026)

– Ferrari expects 2026 to be another year of consistent growth, supported by a stronger product mix in the second half and ongoing sponsorship and lifestyle activity growth. The company reiterates that 2026 targets are aligned with the plan presented at the 2022 Capital Markets Day and maintained with discipline, despite a challenging global environment.

– 2026 is expected to feature a broader model mix as model changeovers progress, with the F80 ramping and four additional exciting model launches planned in the year. Deliveries of Ferrari Luce are scheduled to begin in Q4 2026.

– The company anticipates a stronger product mix variance in the second half of 2026 versus 2025, and personalizations are expected to stay around 20% of cars and spare parts revenues.

– The top-line growth in 2026 is expected to be driven by product mix improvements, sponsorship and lifestyle revenue growth, and ongoing brand and network investments (brand building and digital transformation driving higher SG&A).

– Forward-looking statements and potential implications

– The management emphasizes discipline and confidence in the long-term plan toward 2030, with the 2026 year framed as part of a stable, linear growth trajectory rather than a short-term spike.

– The Luce program is described as a “new chapter” with significant customer engagement and exclusivity, implying low unit volumes but meaningful margin/brand impact. The company stresses that Luce will not be sold to customers who do not love the car.

– The brand intends to leverage the e-building capability to accommodate personalization swing, providing flexibility to meet uneven demand without compromising exclusivity.

– FX headwinds are expected to weigh on 2026 results, with hedging positioned to mitigate some but not all impacts. The company cites an approximate EUR 200 million net FX headwind embedded in their 2026 outlook, reflecting the absence of the hedges that benefited 2025.

– R&D and innovation are expected to remain a priority, with R&D expense anticipated to be broadly stable in 2026 (subject to potential volatility related to Formula 1 spending and regulatory allowances).

– Upcoming milestones mentioned

– May 25, 2026: World premiere/reveal of the Ferrari Luce (Rome event referenced as culmination of the interior reveal phase and a key milestone for the model).

– 2026: Completion of the model changeover across sports cars with 7 new models entering production/distribution phases; Luce deliveries to begin in Q4 2026.

– 2026: Continued progress on the new paint shop and Evo test track; tests on e-Vortex for all sports cars.

– 2026: Opening of two flagship stores in London (early 2026) and New York (late 2026) as part of lifestyle retail expansion.

– Warnings or risk factors discussed for the future

– Ongoing global uncertainties and macro risks are acknowledged as persistent headwinds in guiding the plan.

– FX fluctuations present a material risk; the management notes a significant difference between 2025 hedging benefits and the 2026 exposure, with a hedging position that does not offset the expected spot-rate headwinds.

– Regulatory developments, particularly around CO2 targets in Europe and Formula 1 regulatory changes, pose potential risks to costs and budgeting (noting that as of the call, no plan changes were announced in response to EU CO2 proposals).

– F1-related cost headwinds in 2026 due to new technical regulations and regulatory caps; the company expects volatility in 2026 related to FIA rules and budget caps.

– Personalization dynamics and demand timing remain uncertain (finalization of personalization is typically 4–5 months before delivery, making short-term upside/downside more variable).

– The Luce program introduces exclusivity constraints; the company signals a focus on controlled distribution and selective allocation to preserve brand equity and customer experience.

– Expansion plans or potential mergers/acquisitions

– Expansion initiatives are predominantly in brand and client experience rather than M&A:

– Opening two flagship stores in London and New York to enhance brand experiences.

– Investment in lifestyle experiences and museum attendance continues to be a growth vector.

– No M&A activity or announced acquisitions were discussed; the strategic emphasis is on product launches, geographic presence, and experiential retail.

– Revised earnings guidance for the upcoming year

– The company maintains its 2026 guidance framework, projecting 7% EBIT growth for 2026 (relative to the plan’s baseline). The trajectory is described as a margin-improving mix with higher investment in SG&A, R&D, and brand development, offset by product mix and pricing effects.

– The margin target for 2026 is described as flat to up vs. 2025, with the expectation that product mix variance will be more favorable in the second half of 2026.

– The 2026 effective tax rate is guided to be around 23%.

– The 2026 expected industrial free cash flow is expected to be sustained, albeit with CapEx slightly higher than in 2025. Net working capital is anticipated to be more neutral than in 2025 (thanks in part to the F80 advance receipts in 2025).

– Forward-looking financial metrics management is focusing on

– EBIT growth and margin trajectory for 2026, with a target of about 7% growth and a positive margin variance in H2.

– FX impact (EUR ~200 million headwind for 2026) and sensitivity to USD/EUR and JPY hedges; hedging strategy discussed as not fully offsetting 2026 spot-rate negatives.

– CapEx intensity, with a view toward slightly higher CapEx in 2026 versus 2025, and a stable but potentially higher R&D spend depending on Formula 1 and innovation programs.

– R&D capitalization rate as a long-term consideration, with commentary that the capitalization rate will depend on overall R&D and innovation expenditure.

– Strategic initiatives and their expected timeline

– Ferrari Luce: complete introduction into the product lineup in 2026, culminating in the May 2026 reveal and full deliveries starting in Q4 2026.

– Model changeovers: executing the planned model transition for 2026, with a stronger mix in the second half and four additional model launches in 2026 (in addition to Luce).

– Industrial investments: ongoing construction of the new paint shop; Evo test track completion; e-Vortex testing across sports cars.

– Geographic and experiential expansion: flagship store openings in London and New York; continued expansion of the lifestyle and museum experiences.

– Racing and sailing initiatives: continued participation in the FIA WEC with the 499P; Formula 1 cost and technical regulation considerations; Hypersail sailing project moving toward a waterfront debut by year-end 2026.

– Personalization capabilities: leveraging the e-building program to manage demand swings and delivery timing, ensuring exclusivity remains central to Ferrari’s brand proposition.

– Management’s outlook on market conditions and competitive positioning

– The management expresses strong brand momentum and an “unbroken” demand dynamics with a solid order book that extends to the end of 2027.

– Residual values are described as stable and solid; UK residual value concerns were said to be stabilizing due to tightened shipments.

– The leadership emphasizes Ferrari’s ability to deliver growth through product diversification, geographic diversification, and enhanced client experiences, underpinned by a technology-neutral strategy and a focus on exclusivity and craftsmanship.

– Regulatory changes and business impact

– EU CO2 targets and potential relaxations were discussed as a regulatory backdrop; management indicated there is no current change to their plans as a result of these proposals.

– Formula 1 regulations and associated budget and technical rule changes for 2026 were identified as a factor contributing to near-term cost headwinds and volatility in R&D/industrial spending.

– The company highlighted ongoing interactions with regulatory bodies and a precise internal process to interpret regulatory changes, with a named internal resource (Elisa) referenced for regulatory insights.

– Operational improvements and efficiency gains

– Q4 2025 benefited from a lower cost base and a favorable product mix (including Dodici Cilindri and other high-end models), contributing to stronger margins.

– Government R&D grants and reduced racing expenses related to the 2025 Formula 1 ranking contributed positively to Q4 results, with expectations of similar but potentially volatile R&D impacts in 2026.

– Increased focus on personalization capacity (via the e-building) to better manage demand swings and avoid past supply constraints (e.g., Purosangue timing) without compromising exclusivity.

– Net working capital improvements and robust cash generation driving industrial free cash flow over EUR 1.5 billion in 2025, though 2026 will require continued CapEx and investment in brand/lifestyle initiatives.

– Projected changes in business model or strategic direction

– The company remains committed to a 20-40-40 product mix split (20% internal combustion, 40% hybrid, 40% electric) as its current plan, with the flexibility to adjust the mix if market conditions require (noting a stated willingness to reassess in 2028 if necessary).

– Emphasis on “customer is at the center” and exclusivity-driven growth, with personalization and limited Luce production as central elements of the strategy.

– Continued focus on luxury experiences, brand-building, and selective geographic expansion to maintain premium positioning and high-margin growth.

—

## Analysts and Questions (Forward-Looking Focus)

– Summary of analyst questions focused on future outlook and guidance

– Margin trajectory for 2026: Is 2026 margin flat to up, and will the second-half mix improvement offset higher SG&A and industrial costs/R&D?

– FX impact and pricing: To what extent will pricing or FX dynamics offset higher SG&A and industrial costs? What is the sensitivity to currency, and will Ferrari ever price to customers to offset FX?

– CapEx and R&D: Will 2026 CapEx be higher than 2025, and how will R&D spend evolve? How much of R&D is driven by Formula 1 vs. product development?

– F80 ramp and ASP drivers: How many F80 units shipped in late 2025, and what is the contribution to ASP from the XX/12Cilindri, the F80, and the Daytona SP3?

– Residual values and used-car dynamics: What is the outlook for residual values outside the UK, and what is the status of the used-car market and dealer confidence?

– Luce volumes and exclusivity: What is the expected volume range for Luce within the overall range, and how will exclusivity constraints affect volume vs. profitability?

– Order book and production capacity: How long is the order book, and will the company’s production capacity and e-building enable faster personalization while preserving exclusivity?

– 2030 plan and 2026 as a potential “tough year”: Is 2026 the toughest year in the plan, or could there be tougher periods later in the plan? How should investors think about the long-term trajectory?

– Key forward-looking questions that went unanswered

– Exact quantify of F80 shipments in Q4 2025 and the precise impact on ASP from the F80 ramp (management avoided disclosing unit numbers).

– Specific Luce volume guidance or a defined range within the overall lineup (Luсe volumes were described as exclusive with limited supply but no numeric range disclosed).

– Break-out impact of personalizations on near-term revenue (R&D/Sponsorship visibility is discussed, but exact ASP mix contribution by personalization remains uncertain).

– Precise geographic allocation for Luce and how India tariff developments might alter future geographic mix.

– Analyst concerns about future performance or strategy

– FX headwinds and hedging effectiveness for 2026; how much of the EUR 200 million headwind is offset by hedges vs. spot-rate movements.

– The sustainability of higher SG&A given investments in brand, digital transformation, and lifestyle expansion, and whether the 2026 margin guidance will be sustained as CapEx and R&D rise.

– The impact of regulatory changes on BEV mix and product development cadence, given the high-exclusivity, high-margin business model.

– Unexpected forward-looking questions posed by analysts

– The degree to which Ferrari would consider pricing strategies or channel actions to partially mitigate FX and regulatory headwinds (the company stated no current plans to price to customers, maintaining contractual flexibility rather than direct pricing adjustments).

– The potential long-term trajectory of personalization as volumes scale; questions around whether the 19-20% personalization target will continue to be sustainable given evolving demand and the capacity provided by e-building.

– The implications of Luce exclusivity on long-run volume, and whether future iterations could adjust the 20-40-40 product split in response to market conditions.

Note: All forward-looking statements and implications above are grounded in the management’s explicit guidance and statements as presented in the earnings call transcript.

Guidance Analysis

Market Insights

Product & Market Focus

Product and Market Focus

– Market expansion and new product launches

– Ferrari Luce: introduced as the flagship full-electric sports car, representing a new chapter and the company’s commitment to an electrified future. The interiors and design philosophy shown in San Francisco signal a focus on innovation meeting craftsmanship. The global reveal plan includes a May 25, 2026 world premiere in Rome and ongoing interior concept signaling the design direction.

– Expanded product lineup in 2025: 6 new sports cars added, including the Luce, with a mix of internal combustion engine (ICE) and hybrid powertrains. Notable new models include the 8-cylinder Amalfi, the hybrid high-performance 849 Testarossa Coupe and Spider, and the hybrid 296 Speciale and Speciale Aperta, creating a broader, more technology-neutral portfolio.

– Model transitions and ramp-ups: 7 new models entered production and distribution in 2025, with the Dodici Cilindri family expanding globally and the SF90 XX family at a peak. The Daytona SP3 completed its limited-series run in Q3 2025, and the F80 began ramping in late 2025, with Luce deliveries starting in Q4 2025. In 2026, further model changes and ramp-ups are planned to sustain mix and growth.

– Strategic industrial investments to support product cadence: ongoing construction of a new paint shop and the completion of the Evo test track, plus testing across the e-Vortex program, underpin the ability to deliver a broader model portfolio and higher personalization.

– New markets and geographic expansion

– Global distribution expansion: Dodici Cilindri and Luce contribute to a broader geographic reach; a plan to distribute the F80 and Luce across major regions continues, with emphasis on balancing geographic mix as new models ramp.

– Asia, U.S., U.K., and Middle East activity: early feedback from new vehicle introductions in these regions confirms continued interest in the new models, including customer enthusiasm for Luce’s interiors; some regions are exhibiting early adopters of the F80.

– India opportunity: management highlighted India as an area of interest given tariff agreements improving, signaling potential future expansion opportunities.

– Brand experience channels to reach customers: opening two flagship stores (London and New York) in 2026 to deepen client engagement and experience, alongside expanding the lifestyle retail network and client activations.

– Customer acquisition costs and growth rates by segment

– Explicit CAC figures are not provided. The call emphasizes demand visibility and brand-led demand signals, including a solid order book extending to end-2027 and new client uptake (notably from Amalfi) as indicators of demand growth.

– Growth dynamics by segment:

– Sports cars: upstream volume/mix improvements supported by the addition of Luce and 7 new models in 2025, with a stronger product mix versus 2024; net revenue growth in 2025 driven by higher personalization and a richer model mix.

– Racing and sponsorship: sponsorship, commercial, and branding revenues increased in 2025, aided by better performance in competitive racing and associated activities.

– Lifestyle and experiences: continued investment in client activations and museum attendance (nearly 900,000 visitors in 2025) signaling higher engagement and monetization opportunities beyond vehicles.

– Personnel and capex cadence: higher SG&A and brand investment in 2026 reflect anticipated growth investments to support the expanded product lineup and lifestyle ecosystem.

– Partnerships and collaborations to expand market reach

– LoveFrom collaboration: Ferrari highlighted the proximity to its LoveFrom partner in San Francisco, underscoring a design collaboration that informs Luce’s craft-forward, technology-neutral approach.

– Racing ecosystem and sponsorships: increased sponsorship and branding revenues reflect ongoing partnerships within racing and lifestyle activities, including the World Endurance Championship success with the 499P hypercar.

– Dealer network and e-building: a global network of around 200 dealers and the e-building initiative (capacity for enhanced personalization) expand Ferrari’s market reach and customization capabilities.

Customer and Market Insights

– Customer satisfaction and feedback

– Client-centric philosophy: Ferrari emphasizes that clients are the most important asset, with ongoing emphasis on craftsmanship, high tailoring capabilities, and personalized experiences.

– Driving experience enhancements: reintroduction of a more physical steering wheel with mechanical buttons aims to enhance the driving experience and emphasize the “humanism of technology.”

– Enthusiasm for Luce: journalists and early audiences in San Francisco expressed highly positive reactions to Luce, with remarks that the car name and location were well-chosen, reinforcing a strong perception of Ferrari’s innovation trajectory.

– New client interest from Amalfi: Luce-related demand is attracting new clients, including some from brands that value performance and elegance, signaling successful brand penetration beyond traditional customer bases.

– Dealer and customer confidence: management described dealer confidence as very strong and noted resilience in residual values, especially with UK stabilization following deliberate shipment reductions to manage depreciation risk.

Marketing & Branding

– Brand positioning and customer engagement

– Brand narrative: Ferrari positions Luce within a long-term, disciplined growth plan that balances exclusive, high-end appeal with innovative technology and sophisticated design. The emphasis remains on exclusivity, craftsmanship, and client ownership experience.

– Experience-driven strategy: client activations, immersive experiences, and museum engagement are central to Ferrari’s branding, reinforcing a lifestyle luxury positioning beyond vehicle sales.

– Exclusivity and selective distribution: Luce will be delivered selectively to clients who truly value the car, reinforcing the brand’s premium, exclusive positioning rather than volume growth.

– New marketing strategies or advertising campaigns

– Experience-based marketing: emphasis on client activations, flagship store openings, and immersive brand experiences as primary growth levers rather than mass advertising.

– Museum and lifestyle integration: the Maranello/Modena museum’s near-900k visitor count in 2025 supports brand exposure and experiential marketing as a core strategy.

– Marketing channels or platforms

– Digital transformation and branding investments: management cited ongoing investments in digital infrastructure and brand-building initiatives, indicating a shift toward enhanced digital marketing and customer experiences.

– E-building and personalization capacity: expanding production flexibility to fulfill bespoke customer requests reinforces an omnichannel, customer-centric distribution and delivery approach.

– Partnerships or sponsorships for brand exposure

– Racing sponsorship and WEC success: ongoing sponsorships linked to the 499P program contribute to brand visibility and commercial upside.

– Lifestyle activations and partnerships: increased revenues tied to lifestyle activities reflect an integrated branding strategy across experiences and events.

– Social media marketing strategies

– Not explicitly discussed in the call; therefore not included in this report.

– Customer experience and branding impact

– The company’s emphasis on “humanism of technology,” tactile interiors, and highly personalized experiences aims to reinforce Ferrari’s premium brand equity and deepen customer loyalty.

– Flagship stores and immersive client activation spaces are designed to elevate the brand experience and support premium pricing and personalization.

– Changes in branding or rebranding strategies

– The Luce rollout and the expanded, experience-led brand ecosystem indicate a strategic evolution of Ferrari’s branding toward electrified performance while preserving the core luxury identity and exclusivity that define the brand.

Notes

– This analysis exclusively reflects content discussed in the provided earnings call transcript. Where management provided qualitative guidance (e.g., order book strength, product mix, and brand investments), those elements are incorporated as market and product signals. Quantitative details such as explicit customer acquisition costs, by-segment growth rates, or precise marketing channel allocations were not disclosed and are not inferred beyond the stated guidance and strategic framing.

Sentiment Analysis

Detailed Sentiment Analysis

CEO Opening Remarks

– Summary of sentiment and framing

– The CEO sets an upbeat, confident tone, emphasizing Ferrari’s momentum, innovation, and strategic clarity. He foregrounds Luce as a centerpiece of the future and ties 2025’s achievements to a broader, disciplined path toward 2030. The messaging blends pride in execution with forward-looking caution and discipline, reinforcing a narrative of “new beginnings” and disciplined progression.

– Key themes include: 6 new sports cars in 2025, the Luce as a “new chapter,” a strong and visible product diversification strategy, a solid and expanding order book, and a deliberate plan to unveil and ramp the Luce in 2026 with additional model launches subsequently. The signal is that Ferrari remains both exclusive and relentlessly innovative, with a clear focus on the client experience and brand value.

– Direct quotes reflecting sentiment and strategic tone

– “2025 has been a remarkable year for our company. It has been a year of consistent execution and a year of new beginnings, a year of new commitments and a year of strong innovation, during which we launched 6 new sports cars, a clear testament to our horizontal product diversification and technology neutrality strategy. This included the long-awaited Ferrari Luce, which marks a new chapter in our history and allows us to look confidently towards the future.” (Benedetto Vigna)

– “The momentum for our brand remains strong with a solid order book, which extends towards the end of 2027 and the net order intake supporting further visibility, notwithstanding the persistent uncertainty in the global environment.” (Benedetto Vigna)

– “In 2026, we will continue to enrich our product offering with 4 exciting model launches.” (Benedetto Vigna)

– “In sports cars, a key focus will be the complete introduction of the Ferrari Luce in our product range.” (Benedetto Vigna)

– “The Ferrari Luce marks a new chapter in our history and allows us to look confidently towards the future.” (Benedetto Vigna)

– “Clients are at the center of what we do… the humanism of technology is key for all our sports cars to deliver an enhanced experience for our clients.” (Benedetto Vigna)

– “We look ahead with discipline that is required in the current context and with confidence in the long-term opportunities that lie ahead of us.” (Benedetto Vigna)

– Implications for investor perception

– The message reinforces confidence in Ferrari’s ability to sustain growth through product diversification (including Luce) while maintaining exclusivity and high-margin, high-ASP business — a positive for investors seeking quality and brand-strength in luxury autos.

– Emphasizing an orderly, milestone-driven plan (May/2026 Luce unveil; end-2027 visibility) supports a narrative of predictable execution rather than episodic news-driven swings.

– The client-centric, craft-and-technology narrative (versus volume growth) aligns with a luxury-brand investment thesis, potentially supporting premium multiples and resilience to macro softness.

CEO Closing Remarks

– Summary of sentiment and framing

– The closing remarks reinforce gratitude, confidence, and a disciplined, forward-looking stance. The CEO reiterates the exceptional nature of 2025 and emphasizes fidelity to Ferrari’s identity, discipline, and progress. The tone is appreciative, yet strategically focused on continuing execution and maintaining confidence in long-term opportunities.

– The closing seals the message of a durable, value-driven path rather than a short-term sprint, underscoring continuity and the importance of staying aligned with the brand’s luxury positioning and exclusivity.

– Direct quotes reflecting sentiment and strategic tone

– “The year ’25 is a remarkable year. This is the objective that I would like to remember about this year. And this represent and underscore once again the strength of our business model. And with this, we continue to execute our business plan with discipline and confidence — with discipline and confidence remaining true to our identity forward-looking, and defined by our will to progress.” (Benedetto Vigna)

– “I would like to wish all of you… thanks again for your time, for your questions and for all your support.” (Benedetto Vigna)

– Implications for investor perception

– The closing reinforces a durable, disciplined growth narrative tied to the brand’s identity and long-run plan. It signals management confidence that the plan remains intact and that execution quality will remain a differentiator even as new models (like Luce) come online.

– By anchoring performance in the “strength of our business model” and “discipline and confidence,” the CEO aims to reduce concern about near-term volatility and emphasize strategic resilience and a long-run trajectory.

Sentiment of Questions from Analysts

– Tone and content overview

– The Q&A session is dense with analytical scrutiny and practical concerns. Analysts probe margin trajectory, FX headwinds, model ramp-ups (notably F80), residual values, geographic mix, ASP dynamics, capex/R&D spend, and the Luce’s volume/availability and exclusivity.

– Questions reflect concern about execution risk in 2026 (a year of numerous model transitions and regulatory/funding variables) and the implications of FX movements and policy/regulatory changes.

– Selected quotes reflecting analysts’ main concerns

– Margin trajectory and FX impact:

– “I have two questions. The first one, please, on the margin bit in Q4. Antonio, you talked about the guidance of ’26, which you expect your operating margin to be flat to up.” (Edouard Aubin, Morgan Stanley)

– “Are you expecting mix on pricing to offset higher SG&A and high industrial costs and R&D…?” (Jose Asumendi, JPMorgan)

– “Could you please talk about the F1 related headwinds for 2026, because of both the new regulation and last year’s ranking?” (Tom Besson, Kepler Cheuvreux)

– F80 ramp and volumes:

– “The ramp-up of the F80. Are we right in understanding that it could kind of follow a similar pattern than the Daytona?” (Edouard Aubin)

– Residual values and market dynamics:

– “Residual value trends and also the used market… what’s been going on? There’s been a noticeable pickup in used vehicle sales in the U.K.… what is the state of dealer confidence in the brand?” (Stephen Reitman, Bernstein)

– Order book, exclusivity, and Luce positioning:

– “The models that are driving your order book the most, and if you have already seen an impact in terms of new clients from the Amalfi?” (Monica Bosio, Intesa Sanpaolo)

– “With Luce, how exclusive will it be in terms of volumes? Could you discuss the volume framework or exclusivity considerations?” (Barclays/Citi-like line of questioning; Henning Cosman)

– Geography and mix:

– “Geographies… Americas going down, has nothing to do with the strength of demand. It’s just model changeover.” (Andrea Balloni, Mediobanca)

– Long-term plan and personalization:

– “Shape of the plan through to 2030… are you on a steeper trajectory and will you perhaps decline in the latter half of the plan?” (Barclays, Henning Cosman)

– Other operational details:

– “Could you give us a sense of what spare parts represents as a part of the car and spare parts business, revenues?” (Anthony Dick, ODDO BHF)

– “What does 499P Modificata contribute in Q4, and how will that trend in 2026 affect ASP and volumes?” (Michael Binetti, Evercore ISI)

– Implications for investor perception

– Analysts are predominantly testing the robustness of the 2026 plan against FX volatility, model transitions, and the Luce’s exclusivity/volume mechanics. The persistent focus on margins, capex/R&D pacing, and the potential drag or offset from F1-related costs indicates a market sensitivity to how Ferrari manages the mix between exclusivity-driven revenues and the costs of heavy investment in innovation and racing.

– The breadth of questions around Luce (volumes, exclusivity, timing of unveil) signals that investors are particularly attentive to the market’s reception of this new flagship and its impact on mix, ASP, and brand value over the medium term.

Sentiment in Responses to Analysts’ Questions

– Tone and content overview

– Executives respond with a mix of hedged precision and direct clarity, emphasizing plan discipline, hedging positions, and a focus on mix and pricing to offset cost pressures. They acknowledge FX headwinds and the limited ability to forecast certain personalization-related visibility far out but reaffirm the company’s commitment to the plan.

– Responses reinforce the stance that the business is resilient, with a clear expectation that 2026 will leverage mix and price to offset higher costs, while CapEx will be slightly higher and R&D spend will remain fairly stable barring volatility from F1 regulations.

– Key quotes illustrating response style and sentiment

– On margin trajectory and 2026 plan:

– “We do expect mix and price to more than offset cost.” (Antonio Picca Piccon)

– “On 2026, we expect the mix to be stronger as a variance in the second half of the year.” (Antonio Picca Piccon)

– On FX impact and hedging:

– “We are assuming… headwind of about EUR 200 million that are already in the numbers we have been giving to you.” (Antonio Picca Piccon)

– “In 2026 we do not have the benefit of hedges put in place at that rate at the time it was 105… the impact is clearly much more negative.” (Tom/Antonio exchange on hedging dynamics)

– On Luce and exclusivity/volume approach:

– “We will not sell this car to people that do not want the car.” (Benedetto Vigna, on Luce exclusivity)

– “The client is the center of what we do… the experience we design and deliver for our clients all over the world.” (Benedetto Vigna)

– On F80 ramp and production:

– “We started the production as planned.” (Benedetto Vigna)

– “We shipped a few units in Q4, and this unit ended in the hand of customers all over the world.” (Benedetto Vigna)

– On residual values and geography:

– “Residual value is stable and solid.” (Benedetto Vigna)

– “Americas going down, has nothing to do with the strength of the demand. It’s just modern changeover.” (Antonio Picca Piccon)

– Implications for investor perception

– The responses convey a disciplined, fact-based defense of the plan, with explicit acknowledgement of FX headwinds and a clear view that price/mix can offset costs. This supports a narrative of resilience and targeted profitability even in a challenging macro/regulatory environment.

– Emphasizing Luce exclusivity and controlled rollout reinforces Ferrari’s branding discipline and the importance of maintaining premium pricing and brand equity, which could bolster investor confidence in long-term ROIC and ESG-like brand attributes.

Overall Sentiment Analysis

– Comprehensive view

– The earnings call conveys a predominantly confident, disciplined, and forward-looking sentiment. Ferrari emphasizes strong 2025 execution, a robust order book, and a strategic, milestone-driven path toward Luce and other model launches in 2026-2027. While FX headwinds and high R&D/Capex expectations are acknowledged, the management team repeatedly frames them as offsettable through mix, pricing, and efficiency.

– Executives stress exclusivity, client-centric design, and brand equity as core differentiators in a luxury market where volume growth is not the primary objective. The tone is positive but measured, underscoring a long-term trajectory rather than near-term fireworks.

– Direct quotes illustrating the broader sentiment

– “2025 has been a remarkable year for our company… a year of strong innovation, during which we launched 6 new sports cars.” (Benedetto Vigna)

– “The momentum for our brand remains strong with a solid order book, which extends towards the end of 2027.” (Benedetto Vigna)

– “The Ferrari Luce marks a new chapter in our history and allows us to look confidently towards the future.” (Benedetto Vigna)

– “The year ’25 is a remarkable year… we continue to execute our business plan with discipline and confidence.” (Benedetto Vigna)

– “We do expect mix and price to more than offset cost.” (Antonio Picca Piccon)

– “Residual value is stable and solid.” (Benedetto Vigna)

– “We will not sell this car to people that do not want the car.” (Benedetto Vigna)

– Potential market reaction implications

– Positive: Investors may interpret Ferrari’s narrative as evidence of durable pricing power, high-margin earnings potential, and brand-led resilience, supported by a strong order book and Luce-driven strategic pivot. The emphasis on exclusivity and controlled rollout reduces the risk of negative volume surprises and preserves ASP and margin discipline.

– Cautionary: FX headwinds and the explicit need for H2 improvements in margins for 2026 could keep the stock sensitive to macro shocks and currency moves. The emphasis on a long planning horizon and exclusivity may also lead to questions about near-term visibility in volumes, particularly around Luce’s initial ramp and the 2026 model changeovers.

Second Step: Detailed Summary of Sentiment Analysis

– CEO message quality and reliability

– The CEO delivers a confident, disciplined outlook anchored by 2025 achievements and Luce-driven growth, reinforcing a long-term value-building narrative rather than short-term gains.

– Key sentiment anchors: pride in execution, optimism about Luce as a “new chapter,” and a commitment to disciplined plan execution.

– Analyst questions and concerns

– The questions reveal a focus on margins, FX impact, model ramp timing, Luce exclusivity, ASP dynamics, and geographic mix. There is a pervasive desire to quantify the impact of FX hedges and the volume implications of Luce.

– Sentiment is analytical and cautious, seeking to validate the sustainability of Ferrari’s profitable growth path amid model transitions and external headwinds.

– Management responses and tone

– Responses combine hedging realism with opportunistic optimism. They acknowledge headwinds (FX, F1 costs) but assert that pricing/mix will offset them, and reiterate the strategic importance of Luce and personalization capacity (e-building).

– The tone remains helpful and transparent, with explicit statements about hedging position, planned capex, and R&D dynamics. The Luce exclusivity stance is reinforced, aiming to protect brand value and pricing integrity.

– Net sentiment and market implications

– The call conveys a balanced, constructive sentiment: strong past performance, clear strategic plan, and an attractive, albeit complex, path to future profitability through brand strength and selective volume growth.

– The overall market reaction could be incremental upside if Luce resonates with clients and journalists during May 25 reveal, coupled with continued margin resilience in 2026. However, FX sensitivity and model-changeover costs keep the stock in a cautiously optimistic posture, awaiting further confirmation of 2026 margin progression and Luce volume realism.

(Note: All quotes attributed to the speakers are taken directly from the transcript. Where multiple speakers contributed to a single theme, quotes reflect the primary speaker for that portion of the discussion.)

Summary for decision-makers (action-oriented)

– Leverage the positive sentiment around 2025 execution, Luce-driven growth, and a disciplined, long-term plan as fundamentals underpinning valuation.

– Monitor updates on Luce volume guidance and real-world demand signals in 2026, particularly how exclusivity interacts with ASP and margin stability.

– Track FX hedging developments and 2026 guidance for EBIT margins, as the EUR 200 million headwind guidance and hedging dynamics are central to near-term profitability.

– Consider responsiveness to personalization dynamics and the pace of capex/R&D investments as indicators of Ferrari’s ability to sustain premium pricing and brand strength in a luxury market.

Risk Analysis

Key Q&A Insights

Capital Allocation

Below is a structured capital allocation analysis of Ferrari’s 2025 full-year results call, focused on how management framed capital deployment, shareholder returns, funding of growth, and related financing considerations.

1) Executive summary of Ferrari’s capital allocation approach

– Growth investment priority alongside disciplined shareholder returns

– Management evidence: Ferrari is funding a broad product and brand expansion while delivering strong cash generation. Key growth investments highlighted include the Ferrari Luce launch as a long‑term flagship, seven new models in 2025–2026, a new paint shop, the Evo test track, e‑Vortex testing, and additional flagship stores (London and New York) to reinforce the lifestyle/retail network. They also emphasized ongoing digital transformation and brand investments.

– Financial outcomes supporting this stance: Industrial free cash flow surpassed €1.5 billion in 2025, underscoring robust profitability and cash generation to support growth and returns.

– Strong cash generation underpins shareholder returns and plan discipline

– Management cited “the conclusion of our previous business plan with all financial targets, including the share buyback plan achieved one year ahead of schedule,” signaling a shift from accelerating buybacks to deploying cash into growth and returns under a new framework.

– They reported “industrial free cash flow generation … over €1.5 billion” and “the shareholder remuneration by roughly 30% to over €1.3 billion between dividends and share repurchases,” indicating a commitment to shareholder value while funding strategic investments.

2) Dividend payments and share buybacks

– Buybacks

– Key statement: “the conclusion of the EUR 2 billion share buyback program” (completed ahead of schedule) signals no ongoing or announced new buyback program at the time of the 2025 results.

– Implication: The company has historically used buybacks as part of the shareholder remuneration mix, but there is no new buyback program disclosed for 2026; capital returns are expected to be funded from ongoing cash generation rather than a continuing buyback program unless announced otherwise.

– Dividends

– The call highlighted that shareholder remuneration in 2025 consisted of both dividends and buybacks, totaling over €1.3 billion with an approximate 30% increase versus prior year.

– Implication: Dividends remain a component of Ferrari’s capital allocation policy, but the company did not provide a detailed or forward-looking dividend policy or payout ratio in this call. The emphasis was on a balanced approach to returns funded by strong free cash flow.

3) Debt management and financing activities

– Explicit debt actions

– The transcript contains no concrete announcements of new debt issuance, refinancing, or restructuring. There were no stated changes to a long-term debt policy or leverage target in this call.

– Financing considerations and FX exposure

– The CFO noted a defined FX headwind assumption for 2026 (about a €200 million EBIT impact under the hedged/spot framework) and explained hedging dynamics: “the hedges put in place … do not offset the negative coming from the spot rate” for 2026, implying continued reliance on hedging but with less upside from hedges versus 2025.

Implication: Ferrari emphasizes cash generation and hedging to protect profitability, rather than signaling a material shift in debt strategy or balance-sheet optimization during 2026.

4) Changes in capital expenditure plans and related investments

– 2026 capex expectations

– Management guidance: “CapEx [will be] slightly higher compared to 2025.” This implies a modestly higher investment cadence to support model changes, new launches, and capacity expansion.

– Specific capex programs driving the increment

– New paint shop construction continues; Evo test track completed; delivery/testing infrastructure (including the new e‑building capacity for personalization) to support higher mix and broader customization.

– Retail and brand investment: Opening of two flagship stores (London early 2026; New York later in 2026) to enhance client engagement and product experiences.

– Product and manufacturing investments: The Luce deliveries begin in Q4 2026, with ongoing ramp of new models (including the 296 Speciale/849 Testarossa lineup replacing older families) and the phased changeover across 2025–2026.

– Net working capital and FCF dynamics

– The CFO noted that net working capital is expected to be “more neutral” in 2026 versus 2025, since the 2025 year benefited from advances collected for the F80. This suggests less tailwind from working capital relief in 2026, partially offsetting higher CapEx.

– R&D and innovation investments

– R&D expense is expected to be stable in 2026 with potential volatility linked to Formula 1 expenditures due to new technical regulations and related allowances. Government grants in 2025 reduced costs (a tailwind that is unlikely to recur at the same magnitude in 2026).

5) Special dividends or one-time payouts

– No evidence of special dividends or unusual one-time payouts

– The call highlights a sustainable, recurring approach to shareholder returns (dividends plus buybacks) and notes the one-time event of completing the €2 billion buyback program. There is no mention of new special dividends or disruptive one-off distributions in 2026.

6) Strategic implications for shareholder value

– Value creation through disciplined growth funding

– Ferrari is signaling that it will continue to fund model launches, brand investments, and retail experiences with cash flow generation, while maintaining a disciplined approach to returns to shareholders (dividends + buybacks) within the framework of the new strategic plan.

– Visibility and optionality

– The order book extending to the end of 2027 and the continued investment in flagship stores, paint shop, and personalization capabilities provide revenue growth and margin upside (via product mix and higher personalization ARPU), supporting a durable capital allocation framework.

– Risks/pressure points to monitor

– FX headwinds and the absence of full hedging benefits in 2026 could pressure EBIT if demand/ASP mix does not offset higher SG&A and R&D cost baselines.

– Capex intensity modestly rising in 2026 will require continued strong free cash flow generation; any deviation in ASP, mix, or intensity of personalization could impact cash flow and the ability to maintain planned shareholder returns.

– The Luce ramp and exclusivity model imply a performance-driven pricing/mix strategy; management emphasized exclusivity and client-led demand, which, if misjudged, could affect volumes and returns.

Bottom line for investors

– Ferrari’s capital allocation is balancing: (1) aggressive product/brand investments (Luce rollout, seven new models, flagship stores, paint shop, e‑Vortex, R&D) and (2) disciplined shareholder returns (dividends plus the completed €2bn buyback; 2025 remuneration >€1.3bn; no new buyback plan announced yet).

– 2025 demonstrated strong FCF generation and a clear framework for continued growth, with capex guidance for 2026 at a level modestly above 2025 and a target to maintain profitability against FX headwinds.

– The cash-flow visibility is supported by a robust order book, premium product pricing, and sustainable residual values, though investors should watch FX dynamics and the pace of Luce/AMALFI-driven demand as 2026 unfolds.

Key management quotes used to underpin the analysis

– On capital allocation and buyback completion: “2025 marks the conclusion of our previous business plan, with all financial target, including share buyback plan achieved one year ahead of schedule,” and “the conclusion of the EUR 2 billion share buyback program.”

– On shareholder returns: “industrial free cash flow generation … surpassing EUR 1.5 billion,” and “shareholder remuneration by roughly 30% to over EUR 1.3 billion between dividends and share repurchases.”

– On 2026 capex and growth investments: “CapEx … is expected to be slightly higher compared to 2025,” plus explicit mentions of Luce deliveries in Q4 2026, 2 flagship stores, new paint shop, Evo test track, and e‑Vortex testing.

– On FX and hedging: “for 2026, we do not have the benefit of hedges … the impact is clearly much more negative,” and “the hedges put in place … do not offset the negative coming from the spot rate.”

– On debt/financing stance: no explicit new debt actions announced; emphasis on continued cash generation and hedging rather than balance-sheet restructuring.

– On CO2/regulatory outlook: management stated there was “no change in terms of regulation for us … we stick to the plan,” indicating no near-term plan disruption from EU CO2 developments.

– On Luce exclusivity and volumes: emphasis on selectivity and client-first approach, with Luce intended for a limited, highly engaged audience rather than broad volume growth.

If you’d like, I can convert this into a one-page institutional memo with a concise bullet recap, a slide-ready capex/FCF/dividend bridge, and a quick sensitivity analysis around FX scenarios and Luce timing.