Audi Cuts Guidance as Tariffs and Restructuring Hit Earnings

By Dominic Chopping

Audi cut its full-year guidance as U.S. tariffs, restructuring costs and weak current market trends hold back sales and profitability at the German automaker.

"The situation continues to be very challenging," Audi Chief Financial Officer Juergen Rittersberger said. "In addition to intense competitive pressure, the drastically increased U.S. import tariffs and expenses for Audi restructuring measures have impacted financial performance in the first half of the year."

The company earlier this year agreed a deal with worker representatives that will see up to 7,500 job cuts over the next few years in addition to measures that aim to increase productivity, speed and flexibility at its German sites. The company plans to save more than 1 billion euros ($1.17 billion) annually in the medium term.

On Monday, Audi said it now expects to report revenue this year of between 65 billion and 70 billion euros compared with an earlier forecast of 67.5 billion to 72.5 billion euros.

It expects the operating margin at 5%-7%, from 7%-9% previously, and net cash flow at between 2.5 billion and 3.5 billion euros, from 3 billion to 4 billion euros previously.

Write to Dominic Chopping at dominic.chopping@wsj.com