The chemical giant BASF suffered a sharp drop in earnings during the crisis year of 2025, falling short of its own forecast.

Adjusted operating profit (Ebitda) fell to €6.6 billion, down from €7.2 billion the previous year – excluding the coatings business sold to financial investor Carlyle, as the DAX-listed company announced Thursday evening in Ludwigshafen. Analysts had on average expected €6.7 billion. BASF itself had most recently anticipated earnings at the lower end of its forecast range of €6.7 to €7.1 billion. At the same time, the group significantly exceeded expectations for free cash flow: at €1.3 billion, it was more than double what experts had predicted. Revenue fell to €59.7 billion (2024: €61.4 billion).

While volumes increased slightly, negative currency effects, slightly declining sales prices, and lower margins weighed on performance. In addition, higher restructuring expenses also took their toll. Bottom line, net profit after taxes and non-controlling interests is expected to be €1.6 billion, above the previous year's figure of €1.3 billion and exceeding analysts' expectations. The main reason was higher earnings contributions from the remaining stake in Wintershall Dea.

The chemical industry – and with it market leader BASF – felt the impact of weak global demand acutely in 2025. The industry association VCI even warned of a collapse of the German chemical industry, declaring a “red alert.” BASF's home base in Ludwigshafen is under particular pressure: internationally high energy prices and bureaucratic hurdles have led to extensive job cuts. Additionally, high start-up costs for the new, multi-billion euro integrated site in China weighed on results, as it launches during a period of economic stagnation and significant market overcapacity. In response, the group has already accelerated its cost-cutting efforts. By the end of 2026, annual costs are to be reduced by €2.1 billion.

BASF will provide an outlook for the current fiscal year when it publishes its final figures on February 27.

(Reporting by Patricia Weiß.; Edited by Hans Busemann; For questions, please contact our editorial team at berlin.newsroom@thomsonreuters.com (for politics and economy) or frankfurt.newsroom@thomsonreuters.com (for companies and markets).)