MARANELLO, Italy - Ferrari N.V. (NYSE/EXM: NYSE:RACE), the iconic Italian sports car manufacturer, with a market capitalization of over $80 billion and impressive revenue growth of 11.2% over the last twelve months, has entered into a multi-year agreement to provide Andretti Formula Racing LLC with power units and gearboxes for their potential entry into the 2026 FIA Formula One World Championship. This supply agreement is contingent upon Andretti Formula Racing LLC receiving formal acceptance of their entry into the championship by the FIA – F1's governing body. According to InvestingPro data, Ferrari maintains excellent financial health with strong cash flows and moderate debt levels.
The collaboration is poised to mark a significant partnership between Ferrari, a long-standing and celebrated name in Formula One, and Andretti Formula Racing, which is backed by TWG Global and General Motors (NYSE:GM). The deal is expected to commence in 2026, aligning with the new technical regulations set to be introduced in the sport.
This strategic move by Ferrari underscores the company's commitment to Formula One and its willingness to support new teams entering the pinnacle of motorsport. The agreement also highlights the potential expansion of the Formula One grid, with Andretti Formula Racing LLC aiming to become one of the select teams competing in the global racing series.
Ferrari's decision to supply Andretti is based on the condition that the latter's application to join the Formula One Championship is approved. The formal process of entry involves a rigorous evaluation by the FIA to ensure that prospective teams meet the high standards required for competition.
The announcement comes at a time when Formula One is experiencing a surge in popularity, with an increasing number of fans and new markets expressing interest in the sport. The inclusion of Andretti, a respected name in the racing world, could further enhance the championship's appeal and competitive landscape. Ferrari's strong market position is reflected in its impressive 33.4% year-to-date return and robust return on equity of 46%. InvestingPro subscribers can access 15+ additional exclusive insights about Ferrari's financial performance and growth prospects through the comprehensive Pro Research Report.
The information in this article is based on a press release statement from Ferrari N.V. The company's shares are publicly traded on the New York Stock Exchange and Euronext (EPA:ENX) Milan under the ticker symbol RACE. While currently trading at premium valuations according to InvestingPro's Fair Value analysis, Ferrari maintains a strong dividend track record, having raised its dividend for three consecutive years with a current yield of 0.57%.
In other recent news, Ferrari reported a robust third quarter in 2024. The luxury sports car manufacturer saw significant growth in both revenue and profit. The company's revenues surged to EUR 1.6 billion, a 7% increase year-over-year, and net profit reached EUR 375 million. These strong financial results were supported by a healthy order intake for the new 12Cilindri coupe Spider and the anticipated F80 supercar, limited to 799 units.
Furthermore, Ferrari's commitment to sustainability was highlighted by the early closure of its gas-powered generation plant, contributing to its carbon neutrality goals. The company maintains an optimistic outlook for the rest of the year, backed by strong market demand and a solid order book. Despite concerns raised about the residual values of certain models and a projected sequential decline in EBIT for Q4, Ferrari remains confident in meeting its 2024 guidance.
Looking ahead, Ferrari plans to start deliveries of the F80 supercar in Q4 2025, focusing on quality of revenue over volume. The company also aims to achieve a 60% reduction in CO2 emissions by 2030, aligning with its sustainability goals. These recent developments underline Ferrari's strategic focus and operational efficiency in navigating economic challenges.
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