88 BMW Group Report 2024 To Our Stakeholders Combined Management Report Group Financial Statements Responsibility Statement and Auditor’s Report Remuneration Report Other Information Financial Performance Results of operations BMW AG Income Statement in € million 2024 2023 Revenues 105,317 107,874 Cost of sales – 88,214 – 90,865 Gross profit 17,103 17,009 Selling expenses – 4,261 – 4,123 Administrative expenses – 4,068 – 3,824 Research and development expenses – 8,315 – 6,924 Other operating income 2,062 1,872 Other operating expenses – 1,953 – 2,067 Result on investments 3,917 3,592 Financial result – 378 – 84 Income taxes – 566 – 1,067 Profit after income tax 3,541 4,384 Other taxes – 17 – 18 Net profit 3,524 4,366 Transfer to revenue reserves – 847 – 564 Profit from the reduction of the share capital – 24 Transfer to capital reserves according to § 237 V AktG – – 24 Unappropriated profit available for distribution 2,677 3,802 Revenues decreased by € 2,557 million compared to the previ- ous year to € 105,317 million, largely as a result of a downturn in sales volumes. The contraction was mainly due to the Chinese market, where revenues fell by € 2,773 million. A positive devel- opment was recorded in Europe, where revenues grew by € 1,056 million. Revenues totalled € 105,317 million (2023: € 107,874 million), of which Group internal revenues accounted for € 81,138 million (2023: € 83,231 million) or 77.0% (2023: 77.2%). The € 2,651 million decrease in cost of sales to € 88,214 million was largely due to lower volumes and was almost proportional to the change in revenues. This line item also includes expenses for statutory and non-statutory warranty and product guarantee obligations, which decreased by € 510 million year-on-year due to remeasurements. Gross profit rose by € 94 million to € 17,103 million. Overall, selling expenses increased slightly, while general ad- ministrative costs recorded a solid increase. A large proportion of research and development expenses re- lated to NEUE KLASSE models, new vehicle models (including the successors to the BMW X3* and BMW X5*), the ongoing dig- italisation across different series and the electrification of the fleet. Research and development expenses rose accordingly by 20.1% year on year. Other operating income increased to € 2,062 million (2023: € 1,872 million), and comprised mainly gains arising on financial transactions and income from the reversal of other provisions. Other operating expenses decreased to € 1,953 million (2023: € 2,067 million) and mainly included expenses from financial transactions and additions to other provisions. Income from profit and loss transfer agreements with Group companies, reported in the line item Result on investments, in- creased significantly. This was essentially due to the increase in the profits of BMW INTEC Beteiligungs GmbH, Munich, which re- ceived a higher level of distributions from its subsidiaries, includ- ing BMW Holding B.V., The Hague. The financial result deteriorated by € 294 million compared to the previous year. The previous year mainly included higher gains arising on the fair value measurement of plan assets offset against pension obligations. Income taxes resulted primarily from the current tax calculation for the financial year. * ↗ Consumption and Carbon Disclosures.