Introduction
French software company Dassault Systemes has extended its medium-term forecast by an additional year while also lowering its revenue growth expectations due to weak demand in the automotive sector and uncertainties related to tariffs.Context
The company, which provides software solutions to automakers, aerospace manufacturers, and industrial firms, had aimed to double its non-IFRS diluted earnings per share (EPS) to between 2.20 euros and 2.40 euros. This target is now revised to be achievable by 2029.Developments
During its capital markets day event, Dassault Systemes adjusted its medium-term revenue outlook, now targeting a compound annual growth rate (CAGR) of 7% to 8% between 2024 and 2029. Previously, the firm had anticipated a robust 10% growth rate for the period from 2023 to 2028.The company has been affected by a prolonged slowdown in the global auto industry, which led to a reduction in its operating margin growth forecast for 2025. This decision was influenced by market volatility associated with U.S. tariffs under the administration of Donald Trump. Additionally, forecasts for 2024 were cut twice in the latter half of the previous year.
The ongoing adjustments to its forecasts have raised concerns among investors regarding Dassault Systemes' ability to meet its medium and long-term targets, particularly those established for 2028.