KTM, the Austrian motorcycle manufacturer, has reported a positive Ebitda of €5.5 million for the January-March quarter, marking its first profitable quarter since Bajaj Auto assumed control. This turnaround is attributed to a resurgence in motorcycle demand and effective cost-reduction strategies.
According to filings from Bajaj Mobility AG, KTM's revenue surged by 70% to €331 million, with motorcycle sales more than doubling to 40,332 units. The company's net loss also improved significantly, decreasing to €35.1 million from €108 million in the same period last year.
This quarter's profit is notable as it follows KTM's bankruptcy filing in November 2024, which stemmed from declining sales and rising operational costs. While KTM had previously reported a substantial Ebitda profit in 2025 due to a one-time restructuring gain, this marks a return to operational profitability.
Cost-Cutting Initiatives
KTM's improved financial performance is the result of extensive restructuring efforts, including:
- Reviewing supplier chains
- Reducing dealer stock
- Discontinuing certain brands
- Implementing workforce reductions, with plans to cut 500 employees by Q3/26
Bajaj Auto's executive director, Rakesh Sharma, emphasized the importance of these measures in enhancing KTM's profitability and operational efficiency.
Strategic Focus on Premium Brands
Bajaj Auto's strategy includes leveraging premium motorcycle brands to enhance profitability and compete more effectively against rivals like TVS Motor Company and Eicher Motors. The efforts to revitalize KTM align with TVS's initiatives to boost the performance of the British brand Norton.
While Royal Enfield has reported a slight decline in exports, Bajaj Auto's shares have seen a 7% increase in 2026, contrasting with a 9% drop in the Nifty Auto index.
Long-Term Partnership
Bajaj Auto's relationship with KTM began in 2007 when it acquired a 14.5% stake. This stake increased to 75% in May 2025, following KTM's bankruptcy. Bajaj has invested significantly in KTM, including a €600 million infusion to stabilize the company.
In February, KTM secured a €550 million loan from a consortium of banks to refinance its debts to Bajaj Auto, further solidifying its financial recovery.
