Volkswagen Earnings: Commodity Hedging Masks Underlying Solid Performance From Pricing and Mix

No-moat Volkswagen reported first-quarter earnings per share of EUR 8.43, handily beating the EUR 6.84 FactSet consensus by EUR 1.59 but down EUR 4.68 from the EUR 13.11 reported last year. Commodity hedging valuation effects added EUR 3.2 billion to operating profit in the prior year but reduced current quarter operating profit by EUR 1.3 billion. Even so, consolidated revenue jumped 21% to EUR 76.2 billion from EUR 62.7 billion a year ago, beating the consensus by 5%. Industrial revenue increased 24% on strong pricing, mix, and volume partially offset by continued but lessening chip shortage disruption, while consolidated deliveries increased 23% to 1.5 million versus 1.2 million last year when the chip crunch was much worse.