Hyundai Motor Company (005380) Q1 2026 earnings summary

Executive summary

• Achieved record high Q1 revenue of KRW 45.9 trillion, up 3.4% year-over-year, despite a global demand slowdown and a 7.2% industry decline, with global market share up 0.3 percentage points and U.S. share up 0.4 percentage points, maintaining above 6% for four consecutive quarters.

• Hybrid vehicle sales reached 174,000 units globally, with hybrids accounting for 17.8% of global sales and 24.8% in the U.S., marking the highest-ever Q1 HEV sales ratio.

• Operating profit declined 30.8% year-over-year to KRW 2.5 trillion due to tariffs, increased incentives, and one-off external factors.

• Net income decreased by 23.6% year-over-year to KRW 2.6 trillion.

Financial highlights

• Consolidated revenue: KRW 45.9 trillion (+3.4% YoY); operating income: KRW 2.5 trillion (-30.8% YoY); operating margin: 5.5%.

• Net income: KRW 2.6 trillion (-23.6% YoY), but more than doubled sequentially (+118.3%).

• Cost of goods sold ratio increased to 82.5% (+2.7pp YoY) due to higher material costs; gross margin declined to 17.5% from 20.2% YoY.

• SG&A expenses rose 2.9% YoY to KRW 5.5 trillion, mainly from increased sales warranty provisions.

• Finance business revenue grew 21.5% YoY; operating profit up 1.4% YoY and 59.1% sequentially.

Outlook and guidance

• Annual operating margin guidance maintained at 6.3%-7.3%, supported by new model launches and contingency measures.

• Continued focus on margin protection through zero-based budgeting and company-wide cost controls.

• Expectation of ongoing volatility from macroeconomic headwinds, tariffs, and Middle East conflict.

• Management expects continued growth in eco-friendly vehicle sales and market share despite uncertainties.