MUNICH -- BMW posted a 4.3 percent increase in third-quarter profit as strong sales in higher-margin core European markets outweighed weak demand in China.
Earnings before interest and taxes increased to 2.35 billion euros ($2.59 billion), the automaker said today in a statement. Revenue rose 14 percent to 22.3 billion euros.
BMW's quarterly vehicle sales in Europe, destination of over 40 percent of its deliveries, were up 6.9 percent to 545,062 cars, leading the automaker to affirm its goal of beating last year's record 2.12 million sales.
The company's 9.1 percent return on carmaking for the quarter slipped from 9.4 percent a year earlier and compares with profitability of 8 percent at Audi and 10.5 percent at Mercedes-Benz.
BMW said it still expects a profit margin in the automotive division of 8 percent to 10 percent this year, compared with 9.6 percent in 2014, as well as higher sales and pretax profit.
BMW repeated its forecast of a solid rise in car sales, revenue and earnings this year. Gains will be held back by heightening competition in the U.S., higher personnel costs, investment in new models and technology, and slower growth in China, the company said in the statement.
"BMW looks slightly better than expected," said Sascha Gommel, a Commerzbank analyst. "Into 2016, BMW's product portfolio will stay under pressure, especially on pricing, because it's comparatively old."
Bankhaus Metzler analyst Juergen Pieper said: "The results are good but the forward perspective looks mediocre. The outlook doesn't reveal a particularly large amount of optimism and I don't see great momentum in 2016."
BMW is locked in a battle with Mercedes and Audi to maintain the lead in global luxury-car sales. While BMW is set to keep a slim advantage this year, its growth has slowed, and margins have shrunk as it revamped its X1 SUV and 7-series sedan.
Mercedes deliveries beat both BMW and Audi for the third consecutive month in September and gained 16 percent in the first nine months of the year.
In the U.S., BMW held a slim lead over Mercedes through the first nine months of the year. BMW had 249,956 sales vs. 249,890 for Mercedes.
Mercedes has also defied the Chinese slowdown in car sales, with deliveries there rocketing 31 percent through September. That compares with global sales gains of 5.8 percent for BMW and 3.8 percent for Audi, and a 2 percent rise and flat sales in China respectively.
BMW’s 5 series will face competition from the new Mercedes E class set to go on sale next year, while new variants of the Mercedes C class will put pressure on the 3 series, Commerzbank's Gommel said.
Reuters and Bloomberg contributed to this report