German defense giant Rheinmetall ( Rheinmetall ) lowered its full-year performance forecast on Wednesday evening, citing delays in military contracts and ammunition deliveries.

This is also the company's second time lowering its outlook since August. In August, Germany canceled plans to build warships, which was supposed to become Rheinmetall's largest order since World War II.

Rheinmetall currently expects its sales to grow to around 13.2 billion euros (14.9 billion US dollars) in 2026, which is lower than the previously estimated range of 13.7 to 14.2 billion euros. The company expects a operating profit margin of about 18.5%, which is lower than the previously anticipated 19%.

Rheinmetall stated that the reason for revising the 2026 guidelines is due to delays in the German military's Arminius Boxer project, which is now expected to be approved for implementation next year. In addition, there have been setbacks in the acceptance testing of artillery ammunition as well.

Affected by this, the company's stock price has fallen by about 35% since the beginning of the year. In the previous four years, as European governments increased their military spending after Russia's full-scale invasion of Ukraine in 2022, Rheinmetall's stock price rose by an average of 114% per year, making it one of the main beneficiaries of this trend.

Analysts, identified as RBC, described this announcement as "clearly negative" and pointed out that there are concerns in the market regarding the timeline of the Boxer project, its scope, and its impact on medium-term guidance. They warned that this news could trigger broader concerns among investors about traditional defense technologies.

"We suspect that bears will see this as a negative signal in the ongoing debate between 'new technology versus old technology' within the industry," they stated.

Despite the lowered guidance, Rheinmetall's reported performance continued to improve. The company's sales in the third quarter increased by 32% year-on-year to 3.15 billion euros; operating profit grew by 62% to 553 million euros.

The new order value is 2.89 billion euros, pushing the order backlog as of the end of the third quarter to 78 billion euros.