What Aston Martin Lagonda Global (AML) Said on Its Q3 Earnings Call

Key Points

• Improved financial performance: Year-to-date revenue rose 38% and gross margin reached 35%, while adjusted EBITDA increased by £125 million. Aston Martin maintained its full-year outlook, including 500 Valhalla Coupe deliveries and an adjusted EBIT margin approaching break-even.
• Valhalla strengthens the product lineup: The Valhalla Coupe is nearly sold out, and the newly introduced Spider has a strong order book. The combined initial production run will slightly exceed 999 vehicles, with the Spider priced about 20% above the Coupe.
• Cash position and demand improved: Free cash outflow nearly halved year over year, while liquidity reached approximately £320 million. Core retail demand remains more than 20% above wholesale volumes, although Middle Eastern conditions are challenging and the core order book remains stable at roughly five months.

Aston Martin Lagonda Global LON: AML said its year-to-date performance through the third quarter of 2026 reflected progress toward its strategic and financial goals, with improved profitability, lower free cash outflow and a stronger liquidity position.

Chief Financial Officer Doug Lafferty said core retail demand exceeded wholesale volumes by more than 20% year-to-date as the company continued to align production with customer demand and maintain its core order book. Revenue rose 38% from the prior-year period, supported primarily by deliveries of the Valhalla Coupe, while total average selling price increased 25%.

The company maintained its full-year outlook, including an expectation to deliver 500 Valhalla Coupes. It expects gross margin to rise into the high-30% range and adjusted EBIT margin to improve toward break-even.

Margins Improve as Valhalla Deliveries Contribute

Lafferty said year-to-date gross margin improved materially to 35%, driven by Valhalla Coupe deliveries and benefits from the company’s transformation program. Adjusted EBITDA increased by £125 million year-to-date versus the prior-year period, while adjusted EBIT improved 22%, despite a 48% increase in depreciation and amortization associated with Valhalla deliveries.

The company expects continued positive momentum in both adjusted EBITDA and adjusted EBIT during the fourth quarter.

Core average selling prices are expected to rise by a low- to mid-single-digit percentage in 2026 compared with 2025. Lafferty said the company expects a similar increase in 2027, helped by an ongoing reduction in dealer support. Dealer support per unit is expected to reach its lowest level of the year in the fourth quarter.

Total average selling price will continue to benefit from special vehicles, Lafferty said. The company expects to complete deliveries of remaining Valhalla Coupes in the first half of 2027, begin Valhalla Spider deliveries in the second half, and deliver the Valen special model.

Valhalla Spider Launch Adds to Special-Model Program

Aston Martin introduced the Valhalla Spider during the call, following the August launch of the Valen. Lafferty said the Valhalla Coupe is nearly sold out and the Spider has begun with a strong order book, with deliveries extending into the fourth quarter of next year.

The combined initial Valhalla production run will be slightly above the previously indicated 999 units, with the Spider accounting for roughly one-quarter of the total. The Spider will be priced about 20% above the coupe, while personalization is expected to be broadly in line with the Valhalla Coupe at approximately 20%.

Lafferty said the coupe-and-Spider production approach had been part of the company’s plan for some time and was not a change prompted by market conditions. He said customer response to the Valhalla Coupe had been positive and the company expects a similar response for the Spider.

Cash Outflow Nearly Halved; Liquidity Reaches £320 Million

Year-to-date free cash outflow nearly halved from the comparable period in 2025, primarily reflecting improved operating performance and lower capital expenditure, according to Lafferty.

The CFO reiterated that full-year free cash outflow is expected to end at a level not materially different from the level reported at the end of the first half. He noted that the company’s fourth quarters in 2024 and 2025 were modestly free-cash-flow positive, but did not provide specific fourth-quarter guidance.

Following July financing activity, Aston Martin entered the final quarter with total liquidity of approximately £320 million. Lafferty said the stronger liquidity position provides resilience and flexibility to continue executing its product and operating plans in a volatile environment.

Order Book Stable Despite Uneven Regional Conditions

Addressing market conditions, Lafferty said the U.S. and U.K. markets have remained strong, while the Middle East has been more difficult. He said the company has redistributed volumes that would have gone into the Middle East to other markets.

The core order book remains at roughly five months, a level the company has discussed for the past 12 to 18 months. Aston Martin would like to increase that range to between six and nine months depending on the vehicle derivative, but Lafferty said there had been no material change in order-book length.

“The retail demand is solid,” Lafferty said, adding that retail sales continue to run ahead of wholesale volumes. The company is working with dealers to adjust inventory levels and said it is largely through its dealer destocking process.

While some work remains, Lafferty said Aston Martin expects to bring wholesale and retail sales into closer alignment within the next four or five months and reach a more consistent dealer inventory level. The company is aiming for a smoother wholesale cadence in 2027, although it expects a seasonal increase in fourth-quarter activity.

China Network Reduced; U.S. Tariff System Unchanged

In China, Aston Martin has reduced its dealership count by about 40% over the past two years, despite recently opening a dealership in Suzhou and introducing the S range in Shanghai. Lafferty said the company is focused on maintaining appropriate dealer partners and positioning its brand for any eventual recovery in the market.

He said there was no special implication from the recent China initiatives beyond the company’s continuing review of dealer coverage and opportunities in individual markets.

On U.S. tariffs, Lafferty said the framework is expected to remain unchanged for 2027. The U.K. can ship up to 100,000 vehicles annually to the U.S. at a 10% tariff, with quarterly allowances of 25,000 vehicles. Volumes above the threshold face a 27.5% tariff. Aston Martin does not have a company-specific allocation and participates under a first-come, first-served system, he said.

About Aston Martin Lagonda Global (LON:AML)

Aston Martin's vision is to be the world's most desirable, ultra-luxury British brand, creating the most exquisitely addictive performance cars. Founded in 1913 by Lionel Martin and Robert Bamford, Aston Martin is acknowledged as an iconic global brand synonymous with style, luxury, performance, and exclusivity. Aston Martin fuses the latest technology, time honoured craftsmanship and beautiful styling to produce a range of critically acclaimed luxury models including the Vantage, DB12, Vanquish, DBX and its first mid-engined plug-in hybrid, Valhalla.

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