Rheinmetall Stock Plunges 14%: A Second Guidance Cut in Three Months

Rheinmetall shares plunged about 14% on Thursday, November 5, 2026 — the biggest fall in Europe's STOXX 600 — after the German defence group cut its 2026 sales and margin forecasts for the second time in three months. The company now expects 2026 sales of about €13.2 billion, down from €13.7 billion to €14.2 billion, and an operating margin of about 18.5%, down from around 19%.

What happened

Rheinmetall cut its outlook late on Wednesday and confirmed the weaker forecast alongside its third-quarter figures on Thursday morning. Sales in the third quarter rose to €3.15 billion from €2.31 billion a year earlier, and operating profit jumped 62% to €553 million, lifting the quarterly operating margin to 17.5% from 14.8%. That strong quarter was not enough for investors, because the full-year outlook moved down — and the new sales forecast sits below even the lowest analyst estimate in a Vara Research compilation, according to Reuters.

Order intake in the quarter totalled €2.89 billion, below the €3.15 billion of sales. Operating free cash flow was negative €82 million. Rheinmetall still expects positive operating free cash flow for the full year, but it dropped its previous target for a cash conversion rate above 40%.

Why the guidance was cut

The main reason is timing, not cancelled demand. Rheinmetall said it no longer expects a contract award this year for Germany's Arminius programme, a large-scale procurement of Boxer armoured wheeled vehicles. Revenue and advance payments linked to Arminius will move into next year, the company said, and it gave no updated timetable for the award.

The second reason is artillery ammunition. Revenue Rheinmetall had expected in the fourth quarter will be delayed by slower batch approvals, pushing that income into next year as well.

The sums involved explain the market reaction. Chief Executive Armin Papperger said in August that Rheinmetall's share of an initial Arminius order could amount to about €12.4 billion, with an advance payment worth more than €3 billion. Losing that advance payment from this year's cash flow is a major reason analysts focused on cash, not just sales.

Why it's blowing up

This is the second cut in three months. Rheinmetall last lowered its sales projections in August, after Germany scrapped a project to procure six F126 frigates. Two cuts in one autumn have turned a timing story into a credibility question: can the company convert Europe's rearmament spending into orders, deliveries and cash on the schedule it promises?

Reuters reported the shares fell 13% on Thursday and were the biggest decliner in the STOXX 600, while the Wall Street Journal reported a plunge of more than 16% in Frankfurt as selling intensified. The wider European market was actually higher — the STOXX 600 rose 0.5% in early trading, led by mining stocks — which made Rheinmetall's drop stand out even more. JPMorgan also cut its price target on the stock to €1,150 from €1,350, according to broker coverage of the results.

The fall extends a difficult run. Rheinmetall was one of Europe's standout defence stocks after Russia's invasion of Ukraine, but shares have fallen sharply over the past year after cancelled orders and mixed results, the Journal noted.

Key facts

• New 2026 sales forecast: about €13.2 billion, down from €13.7 billion to €14.2 billion.
• New margin forecast: about 18.5%, down from around 19%.
• Q3 sales: €3.15 billion, up from €2.31 billion a year earlier, but below a €3.25 billion analyst forecast cited by the Journal.
• Q3 operating profit: €553 million, up 62%, for a 17.5% margin.
• Order intake: €2.89 billion in Q3; operating free cash flow was negative €82 million.
• Arminius: no contract award expected in 2026; revenue and advance payments move into next year.

What's next

Investors will look to Rheinmetall's Capital Markets Day in late November for any update on the Arminius timetable and on longer-term targets, which JPMorgan expects could be revised. The immediate question is simpler: whether the delayed Boxer order and ammunition revenue are formally booked early next year, confirming this was a timing shift, or slip again. Until then, every order announcement from Berlin will move this stock more than usual.

Sources: Reuters via Euronext, The Wall Street Journal, Reuters, Reuters European markets report.

FAQ

Why did Rheinmetall stock fall so much today?

Rheinmetall cut its 2026 sales forecast to about €13.2 billion and its margin target to about 18.5%, its second cut in three months, and shares fell about 14% — the biggest drop in the STOXX 600.

What is the Arminius programme?

Arminius is Germany's planned large-scale procurement of Boxer armoured wheeled vehicles. Rheinmetall no longer expects the contract to be awarded this year, so its revenue and advance payments move into next year.

Did Rheinmetall's third quarter actually go badly?

No. Q3 sales rose to €3.15 billion and operating profit jumped 62% to €553 million. The stock fell on the weaker full-year outlook and delayed orders, not on the quarter itself.

Is the lost revenue gone for good?

On the company's own account, no — it says the Arminius and ammunition revenue is delayed into next year, not cancelled. Whether it arrives on that new timetable is what investors will watch next.