The automaker, owned by China’s Geely Holding, reported operating income of 6.4 billion Swedish kronor ($680.4 million) for the July–September quarter, beating analyst estimates and up from 5.8 billion kronor in the same period last year. Its EBIT margin improved to 7.4%, compared with 6.2% a year earlier.
Volvo attributed the earnings boost to its 18 billion kronor cost-saving program and several one-off gains that strengthened its bottom line.
“In a tough market, we delivered a solid third-quarter result, and our cost and cash actions are delivering,” said CEO Håkan Samuelsson in a statement. “We returned to slight sales growth in September and are ramping up sales of our BEV cars. We are fully on track toward the important January launch of the EX60.”
The Stockholm-listed stock surged as much as 41% in early trading before moderating later in the session. Analysts said the sharp rally reflected renewed investor confidence in Volvo’s profitability and its electric vehicle (EV) transition strategy.
Looking ahead, the company expects further benefits from its ongoing cost-cutting initiatives in the fourth quarter. However, it warned that near-term conditions remain challenging due to macroeconomic headwinds, intensifying price competition, and U.S. import tariffs that could affect margins.
Despite those pressures, Volvo’s upbeat results and strategic focus on electrification have positioned it more favorably amid the global auto industry’s turbulent shift toward EVs.