Hyundai Clocks Mixed Q4: Revenue Climbs 12% While Operating Profit Slips On Warranty Costs

Hyundai Motor Company, the South Korean automotive giant, has reported a mixed performance for the fourth quarter of 2024, with revenue climbing 12% year-over-year (YoY) while operating profit slipped due to increased warranty costs. The company's annual vehicle sales decreased 1.8% to 4.14 million units, with annual revenue up 7.7% to KRW 175.2 trillion. However, operating profit dropped 5.9% to KRW 14.24 trillion, and the operating profit margin hit 8.1%.



In the fourth quarter, Hyundai Motor's sales volume stood at 1.06 million units, down 2.2% YoY. Revenue increased 11.9% YoY to KRW 46.62 trillion, but operating profit decreased 17.2% to KRW 2.82 trillion YoY. The operating profit margin reached 6.1%, and net profit increased 12.3% YoY to KRW 2.47 trillion. The company attributed the decrease in operating profit to higher sales warranty provision resulting from a weaker KRW and increased incentives.

Hyundai Motor will pay a year-end dividend of KRW 6,000 per common share, making the company's total payout KRW 12,000 per common share for the whole 2024. This total includes an interim dividend of KRW 6,000, which is the combined amount from the first, second, and third quarters, reflecting a 5.3% increase compared with 2023.

For 2025, Hyundai Motor shared consolidated financial guidance, targeting global sales of 4.17 million units, annual revenue growth of 3-4% from 2024, and an annual consolidated operating profit margin of 7-8%. The company plans to expand its investment for 2025 to KRW 16.9 trillion, including KRW 8.6 trillion in capital expenditure, KRW 6.7 trillion in research and development, and KRW 1.6 trillion in strategic investments.

Hyundai Motor is committed to prioritizing quality, securing its future competitiveness through bold innovation, and the continuous creation of growth momentum. The company is strategically improving cost efficiency and optimizing sales processes, even amidst the rapidly changing mobility industry and fluctuations in foreign exchange rates. Hyundai Motor is also implementing a flexible operation strategy across its global business facilities in an effort to optimize production, sales, and profitability.

Moreover, Hyundai Motor is proactively responding to customer-specific needs across various types and segments by optimizing product specifications and trims. The company is also poised to leverage the rapidly growing demand for hybrids in the global market.

In conclusion, Hyundai Motor's mixed Q4 performance highlights the challenges faced by the automotive industry in maintaining profitability amidst increased warranty costs and a slowing car market. However, the company's commitment to innovation, cost efficiency, and growth momentum, as reflected in its 2025 financial guidance, suggests that it is well-positioned to navigate these challenges and continue its success in the global market.