Group sales and segment operating income were weighed down by lower business volumes and the stronger euro, although these effects were partly offset by a better sales mix.
Sales totaled €26.0 billion, down 1.4% at constant exchange rates and 4.4% at current exchange rates.
Tire sales volumes decreased by 4.7%, with over 80% of the decline deriving from Original Equipment markets particularly for Truck and Agricultural tires in North America. In the Replacement segment, sales of MICHELIN-brand tires rose slightly year-on-year, while the group's other brands are penalized by distributors' massive stocking of low-priced tires. Sales trend improved in the fourth quarter.
The non-tire businesses (Michelin Connected Fleet, Polymer Composite Solutions, Lifestyle) contributed positively to the Group's sales and operating income.
Segment operating income came to €2.9 billion at constant exchange rates, representing 10.9% of sales, down 1.5 points year-on-year. Although buoyed by a stronger sales mix and operating performance, it was dragged down by low rates of capacity utilization at the Group's plants.
Michelin's fundamentals were strengthened in 2025: the Group adjusted its manufacturing capacity to market conditions, improved its operating performance, accelerated its product plan, and enhanced the leadership of the MICHELIN brand.
Automotive & Two-wheel (RS1): operating margin came in at 11.7%, impacted by lower sales volumes for Original Equipment and for the Group's Tier 2 and Tier 3 brands. The sales mix improved in 2025, with the contribution of 18-inch and larger tires rising to 68% of MICHELIN-brand Passenger car tire sales, and growth seen for MICHELIN tires in Replacement, supported by the new MICHELIN Primacy and CrossClimate ranges.
Road Transportation (RS2): operating margin narrowed to 4.7%, pulled down by weak Original Equipment sales in North America, in a market that shrank by 20% following manufacturers' massive stockpiling of trucks, particularly "Class 8" trucks. The Group has launched a comprehensive adaptation plan for the Road Transportation segment, that includes adjusting industrial capacity, strengthening differentiation through accelerated renewal of product ranges, and promoting connected solutions.
Specialties (RS3): delivered an operating margin of 13.5%, with Tire businesses still hampered by bottom-of-cycle trends in Original Equipment for Agricultural markets, although this was partly offset by substantial growth for Mining and Aircraft tires. Polymer Composite Solutions posted growth, delivering high margins and confirming the benefits of having a diversified portfolio.
A stronger financial position thanks to high cash flow generation.
Free cash flow before M&A amounted to €2.1 billion, reflecting the quality of operational management.
The Group’s gearing was improved to 13%, reflecting its solid balance sheet structure.
Net income was down 12% at €1.7 billion.
Dividend of €1.38 per share to be submitted to the Annual Meeting.
Florent Menegaux, Managing Chairman: “In 2025, several markets where the Group operates were affected by heightened competition, new and very unstable customs tariffs, and an unfavorable regulatory environment, which weighed on our volumes. In this context, our teams responded with exemplary engagement, by closely adjusting the steering of our operations. We also strengthened our financial position, continued to adapt our industrial capacities, and accelerated our product plan. The Group's growth momentum in Polymer Composite Solutions, boosted by our recent acquisitions, confirms our ability to position ourselves in these high value-added activities. We remain committed to continuing to deploy our Michelin in Motion 2030 strategy”.
Outlook for 2026
Regardless of unpredictable fluctuations in international trade rules, tire markets are expected to remain stable over 2026, contracting slightly in the first half, followed by a relative improvement in the B2B Original Equipment markets in the second half of the year.
Alongside its tire business, the Group is accelerating its growth in the field of Polymer Composite Solutions, which will form a new reporting segment in the Group's financial communication as from Q1 2026.
Michelin is targeting growth in segment operating income at iso-forex and iso-scope in 2026 compared with 2025, and over €1.6 billion in free cash flow before M&A.
Confident in its cash flow generation, the Group announces a share buyback program up to €2.0 billion over the 2026-2028 period.