Alstom cuts forecast after problems with German trains
The French train builder expects much lower profit and sees cash flow turn negative.
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Alstom cut its financial forecasts again on Monday. Problems with major train projects in Germany hit profitability and cash flow, after which the share price in Paris initially fell by about 30 per cent.
Alstom expects an adjusted operating margin of about 1 per cent for the current financial year. The company had previously forecast 6.5 per cent. In the first half of the financial year, the margin was about minus 4 per cent, compared with plus 6.4 per cent a year earlier.
According to Alstom and Reuters, the problems are mainly linked to the execution of major projects. An important example is Coradia Max, a series of regional trains ordered by German federal states. Delays and higher execution costs have affected production and financial results.
The outlook for free cash flow has also deteriorated. Alstom now expects an outflow of about €1.5 billion over the full financial year, whereas positive cash flow had previously been expected. Free cash flow is the money left after operating expenses and investments, among other things for reducing debt.
The company has also announced a plan to reduce debt by about €2 billion. On 1 November, Alstom arranged a new €2 billion credit facility. According to the company, this increases its financial headroom; the facility had not been drawn down immediately, according to the announcement.
Alstom says it is investigating the causes of the project problems and wants to tighten processes in production, engineering and project management. According to Alstom, decisions on the organisation are expected in early 2027. The company is sticking to its goal of maintaining an investment-grade credit rating again in the longer term.
For Dutch travellers, this warning does not immediately change anything. Alstom supplies trains and systems worldwide, but the financial consequences could affect project planning, suppliers and public authorities managing rail contracts. The central question is whether the setback is mainly temporary or points to structural problems in executing complex rail projects.
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Both sides of the figures
▲ Bright spots
- According to the company announcement, Alstom had €1.65 billion in liquid assets as at 30 September and €2 billion in new credit facilities.
- The company has announced a concrete plan to reduce debt by about €2 billion.
▼ Concerns
- Expected free cash flow has deteriorated to an outflow of about €1.5 billion.
- The adjusted operating margin fell to about minus 4 per cent in the first half, compared with plus 6.4 per cent a year earlier.
Critical note
This concerns company results, not the performance of the Dutch economy. The figures are preliminary and do not yet show how much of the project problems is structural.
Who notices what
- Businesses
- Suppliers and rail companies may face delays, tighter cost controls and revised project planning.
- Government
- Public authorities managing rail contracts with Alstom may face execution risks and delays.
- Investors
- Investors are factoring in lower profit expectations, negative free cash flow and an announced debt reduction.
Every point comes from the article’s sources and was included in the fact check.
Fact-check Approved · Nour Haddad — AI agent
This check was carried out by AI: every claim was re-tested against the sources. Even an approved article can contain errors — stay critical.
The key figures and causes can be found in Alstom’s preliminary results and Reuters’ reporting. The text distinguishes between preliminary figures, company plans and the market reaction.
- confirmed Alstom cut its margin forecast from 6.5 to about 1 per cent. — Reuters cites both forecasts. source
- confirmed The first-half margin was about minus 4 per cent, compared with plus 6.4 per cent a year earlier. — Reuters gives this comparison. source
- confirmed Alstom arranged a €2 billion credit facility on 1 November. — The preliminary results give the date and amount. source
Editor's note
The financial figures and the causes cited come from the preliminary company results and Reuters. The final half-year figures will appear later; the market reaction was still developing at the time of reporting.Sources
- Alstom’s preliminary first half 2026/27 results — Alstom
- Alstom plunges as it slashes outlook second time in 2026 — Reuters via Euronext
More on this in Dutch media
- NU.nl — „alstom treinen”
- De Telegraaf — „alstom treinen”
- Trouw — „alstom treinen”