Bosch Reports Higher Earnings in 2023, But Long-Term Profitability Goal Delayed

Introduction

Bosch, the privately owned German industrial company, announced increased earnings for 2023. However, the company noted that achieving its long-term profitability goal will take longer than anticipated due to a bleak economic outlook. Let’s delve into the details.

Financial Performance

According to Bosch, earnings before interest and taxes (EBIT) reached €4.6 billion ($4.95 billion) in 2023, up from €3.8 billion in the previous year. The EBIT margin saw an improvement as well, standing at 5% compared to 4.3% in 2022.

In terms of revenue, Bosch reported €91.6 billion for the year, representing a 4% increase (or 8% when adjusted for inflation). The mobility, industrial technology, and energy and building tech divisions experienced single-digit sales growth. However, the consumer goods sector recorded a sales decline of 7%.

Revised Long-Term Goal

Bosch revised its long-term target of achieving at least a 7% yearly growth rate. Due to the gloomy outlook across all key sectors, the company now expects to meet this goal a year or two later. However, Bosch did not specify a new target date.

CFO’s Statement

Markus Forschner, Chief Financial Officer of Bosch, acknowledged the ongoing challenges and explained the company’s focus on balancing efficient use of capital resources with profitability to support future growth.

Conclusion

While Bosch posted higher earnings for 2023, the company faces hurdles in attaining its long-term profitability goal. With a cautious economic outlook, Bosch aims to navigate these challenges while maintaining a strong foundation for sustainable growth.