BASF’s 2025 profits tumble as weak demand and high costs bite
BASF reported a drop in revenue and profit for 2025, as economic challenges and weak demand weighed on its performance. The chemical giant also received hundreds of millions in public funds last year, tied to state-backed guarantees for its former Russian operations.
The company’s revenue fell to €59.7 billion in 2025, down from €61.4 billion the previous year. Operating profit also declined, dropping from €7.2 billion in 2024 to €6.6 billion. BASF blamed shrinking margins, currency fluctuations, and a global oversupply of basic chemicals for the weaker results. High energy costs at its Ludwigshafen plant added further pressure.
The financial strain comes as BASF collected substantial payments from state guarantees in 2025. These funds, totalling €229 million in the third quarter alone, stem from guarantees the German government issued in 2016. They were designed to protect Wintershall Dea’s investments in Russian gas fields. Additional payments arrived in the fourth quarter, though the exact amount remains undisclosed. BASF confirmed that the compensation from these guarantees flows into net income and is distributed to shareholders as dividends. The company’s struggles also reflect broader economic difficulties in the United States, particularly in key sectors like automotive manufacturing.
The state-backed payments have provided BASF with a financial cushion amid declining profits and revenue. However, the company still faces ongoing challenges from weak market conditions and high operational costs. Further details on the fourth-quarter payments are expected to be disclosed in due course.
