Automaker Daimler AG posted blowout quarterly earnings fueled by higher prices for its vehicles during the global semiconductor shortage.
Daimler’s preliminary earnings before interest and taxes surged to 5.19 billion euros ($6.1 billion U.S.) in the second quarter, beating analysts’ expectations of 4.11 billion euros. Profit margin at the cars and vans division reached double digits for a third straight quarter.
Daimler joins Volkswagen AG and Jeep maker Stellantis NV in reporting that it is coping well with the scarcity of microchips that has constrained car production since late last year.
Facing limitations on just how many assembly lines they can keep running, automakers are prioritizing output of their biggest money makers and abstaining from discounts customers are accustomed to even from luxury brands.
Daimler forecast in April that its main Mercedes-Benz unit will be more profitable than it has been in years, thanks to resurgent demand for cars and trucks in the midst of the global pandemic. It raised its projection for annual return on sales for its cars and vans division to 10% to 12%, up from 8% to 10% previously.
The automotive manufacturer is preparing to spin off of its sprawling truck division later this year. The company expects the move to help it better tackle diverging technology trends in the passenger-car and commercial-vehicle industries.
Daimler shares rose as much as 1.8% in German trading on the earnings report. The stock is up 28% year-to-date.