French train manufacturer Alstom reported a return to profitability in the past fiscal year, driven by robust demand for rail travel, the company announced on Wednesday. However, its shares experienced a significant decline as its financial outlook fell short of investor expectations.
The group posted a net profit of 149 million euros ($168 million) for the 2024-2025 fiscal year, a reversal from the 309 million euro loss recorded in the preceding year.
Alstom attributed this positive performance to sustained demand within the railway market, particularly in Europe, which contributed to a nearly five percent increase in annual revenue, reaching 18.5 billion euros.
Amidst global trade uncertainties stemming from US President Donald Trump’s tariffs, Alstom, which acquired the rail division of Canadian group Bombardier in 2021, stated that its global production strategy provided a degree of insulation.
“Local manufacturing has been a fundamental principle in building and expanding our business over the past decade,” Chief Executive Henri Poupart-Lafarge stated during a conference call with analysts.
“Local production is frequently a crucial factor in securing significant tenders. This has been evident in India, Australia, and, of course, in the US for an extended period.”
The group outlined its targets for the upcoming year, focusing on efficiency improvements and securing high-value orders to drive operating margin growth within the range of eight to ten percent.
However, this target underwhelmed investors, leading to a decline of over 15 percent in Alstom’s share price during early trading in Paris.
