Volkswagen’s Anchor Investor Turns to Defence After Earnings Hit

Volkswagen’s largest shareholder, Porsche SE, is shifting its focus toward defence and technology investments after reporting a sharp decline in earnings. The holding company, which controls nearly a third of Volkswagen’s shares and a majority of its voting rights, saw adjusted profits fall by 9% in 2025. The drop was driven by heavy costs at Volkswagen and Porsche AG, including tariffs and the suspension of Porsche’s electric vehicle rollout.


While its core automotive holdings struggled, Porsche SE’s smaller technology investments delivered solid returns, particularly from stakes in drone and semiconductor ventures. Building on that momentum, the company announced a €100 million investment in a newly launched defence fund, targeting European start-ups in areas such as cyber defence and artificial intelligence. The move reflects a broader trend of investors turning toward defence and security sectors amid ongoing conflicts in Ukraine and the Middle East.


Despite diversifying, Porsche SE stressed its continued commitment to Volkswagen, backing recent cost-cutting measures and signaling support for management as they navigate challenges in China and consider divestments of non-core subsidiaries. The company emphasized that Volkswagen remains central to its portfolio, even as it seeks growth opportunities elsewhere.


Shares of Porsche SE fell in early trading following the earnings announcement, underperforming the wider market. Yet the group’s pivot toward defence and technology highlights a strategic effort to balance its traditional automotive focus with sectors offering stronger growth potential in a volatile global environment.


In a year marked by geopolitical uncertainty and shifting market dynamics, Volkswagen’s anchor investor is rethinking its strategy—underscoring how even legacy automotive giants are adapting to new realities.