Ferrari N.V. (RACE) shares surged Tuesday after the Italian luxury automaker reported fourth-quarter results that beat expectations and offered guidance suggesting the prancing horse still has plenty of gallop left.

The company posted quarterly sales growth of 4.0% year-over-year to $2.098 billion (1.80 billion euros), comfortably ahead of the analyst consensus estimate of $2.020 billion. Earnings per share came in at $2.49 (2.14 euros), topping the $2.44 estimate.

The Numbers Behind the Shine

Revenue from cars and spare parts inched up 1% year-over-year, while sponsorship, commercial, and brand revenues jumped 17%. That's the Ferrari playbook in action: it's not just about selling cars, it's about selling the brand in every possible way.

Total shipments fell 5.2% year-over-year to 3,152 units, but here's the thing—that wasn't a bug, it was a feature. More on that in a moment.

Adjusted EBITDA climbed 8.9% year-over-year to 700 million euros, with margins expanding by a hefty 181 basis points to 38.85%. Adjusted net profit dipped slightly by 1.3% to 381 million euros. Operating cash flow totaled 519 million euros, with free cash flow coming in at 269 million euros.

The balance sheet looks healthy too. As of December 31, 2025, Ferrari's net industrial debt stood at just 32 million euros, down from 180 million euros a year earlier. The company held 1.47 billion euros in cash and equivalents.

Demand Stays Strong, Discipline Stays Stronger

CEO Benedetto Vigna credited the impressive financial performance to product mix, personalizations, and sponsorships. But the real headline came when Vigna emphasized that demand for Ferrari remains "solid" and is managed with discipline across every market. The order book now stretches all the way to the end of 2027.

About that shipment decline: Ferrari made clear the 5.2% drop was intentional. The company imposed a self-imposed cap on sales to China and navigated higher tariffs, Bloomberg reported Tuesday. This wasn't about struggling to find buyers—it was about maintaining exclusivity and protecting margins in a challenging market environment.

The Electric Future Takes Shape

While Ferrari has pumped the brakes somewhat on its broader electric vehicle ambitions, the company is still pushing forward with its first electric supercar, the Luce. Designed in collaboration with Jony Ive's firm—yes, the former Apple Inc. (AAPL) design chief—the Luce represents Ferrari's high-voltage bet on the future.

The Ferrari Luce packs four electric motors delivering over 1,000 horsepower. With a 122 kWh battery, it rockets from 0-60 mph in just 2.5 seconds, offers a 330-mile range, and weighs in at 5,100 pounds. That's a lot of car, in every sense.

Looking Ahead to 2026

Ferrari expects to outperform Wall Street estimates in fiscal 2026. The company's fiscal 2026 EPS is projected to exceed $11.00, above the current consensus estimate of $10.92. Revenue is forecast to come in above $8.73 billion, versus analyst expectations of $8.57 billion.

RACE Price Action: Ferrari shares were up 8.63% at $365.14 at the time of publication on Tuesday.