Arms Maker Rheinmetall Slashes Guidance Again as Orders Face Delays — 2nd Update

By Mauro Orru

Rheinmetall said it was forced to cut its annual forecasts for the second time this year because some lucrative contracts faced procurement delays, the latest setback for the defense group that has already lost a big frigate order from the German government.

The company said it expected sales of roughly 13.2 billion euros ($14.77 billion) in 2026, below a prior guidance range of 13.7 billion euros to 14.2 billion euros. Meanwhile, its operating margin should come in at about 18.5% for the year, below a prior forecast of around 19%.

Rheinmetall had cut its sales projections in August after Germany scrapped a project to procure six F126 frigates for about 15.2 billion euros. Berlin had complained of delays and cost increases with the project, and opted instead to purchase eight MEKO A-200 frigates from German shipbuilder TKMS.

This time, the group blamed potential delays with a project dubbed Arminius under which Germany would launch a large-scale procurement of Boxer armored wheeled vehicles that would bring in more than 12 billion euros in sales to Rheinmetall, according to analysts' estimates.

Rheinmetall executives had hoped to lock in a portion of the lucrative deal this year, but the company said it no longer expected a contribution to order intake in 2026. It also said that revenue it had expected from weapons and ammunition wouldn't materialize in the fourth quarter.

The second downgrade to guidance is a setback to a company that emerged as a key beneficiary of higher defense spending after Russia's invasion of Ukraine upended Europe's security architecture.

As members of the North Atlantic Treaty Organization diverted more and more weapons to aid Ukraine, European capitals have been placing a steady stream of orders with Rheinmetall and other defense groups to ensure they could replenish their own stockpiles.

Repeated calls from U.S. President Trump for NATO members to fork out more on defense also helped keep defense spending elevated. Rheinmetall's stock grew more than tenfold in value since Russia invaded Ukraine in February 2022. However, shares are down more than 40% over the past 12 months following a number of setbacks, including canceled orders and mixed financial results.

Rheinmetall's sales grew to 3.15 billion euros in the third quarter from 2.31 billion euros a year earlier, below analysts' forecast of 3.25 billion euros, according to Vara Research.

Operating profit grew to 553 million euros from 342 million euros, generating an operating margin of 17.5%. Analysts had forecast profit of 531.4 million euros and a margin of 16.3%, according to the consensus.

The company said it would post its full set of third-quarter figures on Thursday.

Write to Mauro Orru at mauro.orru@wsj.com

(END) Dow Jones Newswires

November 04, 2026 13:14 ET (18:14 GMT)