Second cut in three months

German defence group Rheinmetall has cut its full-year 2026 sales forecast for the second time in three months, warning that delayed military contracts and ammunition deliveries will push expected revenue into 2027. The company now expects sales of about €13.2 billion this year, down from a previous range of €13.7 billion to €14.2 billion, and lowered its operating margin target to about 18.5% from around 19%. Shares fell 13% on Thursday 5 November, the biggest decline in the STOXX 600 index, and fell more than 17% in early trading.

What slipped

Rheinmetall said revenue and advance payments linked to Germany's Arminius Boxer armoured-vehicle programme would move into next year, because the contract award is no longer expected in 2026. Chief Executive Armin Papperger said in August that Rheinmetall's share of an initial Arminius order could be worth about €12.4 billion, with an advance payment of more than €3 billion. Slower acceptance checks for artillery-ammunition batches will also delay revenue, and income from newer activities — including cooperation with Dutch missile maker Destinus — will not fully materialise this year. The group also dropped its target for a cash-conversion rate above 40%.

Strong quarter, weak outlook

The warning overshadowed a strong third quarter, in which sales rose to €3.15 billion from €2.31 billion a year earlier and operating profit increased 62% to €553 million. But quarterly order intake of €2.89 billion came in below sales, and operating free cash flow was negative €82 million. Analysts at Jefferies said they were surprised by the size of the cut so late in the year. The sell-off raises a wider question for European defence stocks: government rearmament budgets are growing, but suppliers still have to convert procurement plans into signed contracts, accepted products and cash.

[Source: Reuters via Euronext](https://live.euronext.com/en/financial-news/rheinmetall-shares-slide-investors-question-growth-outlook-after-second-guidance-cut) | [Source: Eurasia Business News](https://eurasiabusinessnews.com/2026/11/06/rheinmetall-shares-plunge-after-german-defence-giant-cuts-2026-forecasts/)