ZF Friedrichshafen AG reported stronger financial performance for the first half of 2026, supported by improved profitability, disciplined cost management, and continued focus on operational efficiency. Despite a challenging global automotive market, the company recorded higher earnings, stronger cash flow, and modest organic sales growth, while maintaining its full-year financial outlook.
During the first six months of 2026, ZF generated sales of €19.3 billion, compared with €19.7 billion in the corresponding period last year. While reported sales declined by 2 percent due to currency movements and portfolio changes, the company achieved 0.5 percent organic growth, reflecting stable demand and the strength of its product portfolio.
The company’s adjusted EBIT increased to €964 million, compared with €853 million in the first half of 2025. As a result, the adjusted EBIT margin improved to 5.0 percent, up from 4.3 percent a year earlier. Adjusted free cash flow also showed significant improvement, rising to €989 million from €465 million in the previous year.
Mathias Miedreich, Chief Executive Officer of ZF Friedrichshafen AG, said the company’s performance improvement programme is delivering positive results despite continuing market challenges. He noted that strict cost control, stronger operational execution, and a sharper focus on high-value products are helping improve financial performance while strengthening the company’s flexibility for future growth.
Chief Financial Officer Michael Frick said improved profitability and disciplined investment management played a key role in boosting cash generation during the period. Although restructuring-related payments temporarily affected cash flow, they remain part of the company’s long-term transformation strategy.
ZF also continued to optimise investments during the period. Research and development spending declined by around 7 percent to €1.6 billion, representing 8.2 percent of sales. Capital expenditure on property, plant and equipment fell by approximately 19 percent to €600 million, reflecting the company’s focus on efficient capital allocation.
The company further strengthened its financial position by reducing leverage. Net debt stood at approximately €9.8 billion as of June 30, 2026, while the leverage ratio improved to 2.75 times, compared with 2.98 times at the end of 2025. Available liquidity remained strong at more than €7 billion, including an undrawn revolving credit facility of €3.5 billion. ZF employed 149,675 people worldwide at the end of June 2026, slightly lower than at the end of last year. The reduction reflects ongoing efficiency measures and the company’s transformation initiatives.
Looking ahead, ZF reaffirmed its financial guidance for the full year. The company continues to expect sales of more than €38 billion, an adjusted EBIT margin within the guided range of 4 to 5 percent, and adjusted free cash flow exceeding €1 billion. While geopolitical uncertainties and uneven economic conditions continue to present challenges, ZF remains focused on improving competitiveness, enhancing operational performance, and delivering sustainable long-term value for customers and stakeholders.
