KONE shares fall over 3% despite higher Q3 sales and improved adjusted earnings

Investing.com -- KONE Oyj (HE:KNEBV) shares fell over 3% on Wednesday after the Finnish elevator maker reported higher third-quarter sales and adjusted earnings, while raising the lower end of its full-year revenue growth forecast and narrowing its operating margin outlook.

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Shares traded at €54.44, underperforming the broader OMX Helsinki index, which was up 0.2% in afternoon trading.

KONE's sales rose 5.2% year on year to €2.91 billion in the July-September quarter, while adjusted earnings before interest and taxes (EBIT) increased 8.3% to €369 million.

Reported operating income edged up 1.4% to €339 million, although the operating margin narrowed to 11.7% from 12.1%. Net income increased 19.9% to €272 million, while earnings per share climbed to €0.52 from €0.43.

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Orders received grew 7.2% to €2.29 billion, while the order book expanded 12.5% year on year to €9.80 billion at the end of September, providing support for future growth.

KONE now expects 2026 sales to grow 4% to 6% at comparable exchange rates, compared with its previous forecast of 3% to 6%. It narrowed its adjusted EBIT margin guidance to 12.5% to 12.9%, from 12.3% to 13.0% previously.

Service and modernization continued to support performance, with sales rising 7.0% and 9.5%, respectively. However, weakness in Greater China persisted, with sales declining 10.7% at comparable exchange rates as new-building activity remained subdued and competition continued to pressure pricing.

KONE said its planned combination with TK Elevator was progressing as expected, with regulatory reviews advancing and six unconditional merger clearances received. Completion is anticipated no earlier than the second quarter of 2027.

The company also said cash flow was affected by higher inventories linked to logistics constraints, particularly in the Middle East.

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