===== SIDA 1 ===== Report on the third quarter 2023 Volvo Group ===== SIDA 2 ===== The third quarter in brief ➣ In Q3 2023, net sales increased by 15% to SEK 132.4 billion ( 114.9). Adjusted for currency movements, the increase was 9%. ➣ Adjusted operating income 1 amounted to SEK 19,114 M (11,869), corresponding to an adjusted operating margin of 14.4% (10.3). Adjusted operating income excludes a negative effect of SEK 794 M from a loss on the divestment of the Group's Russian entities. ➣ Reported operating income amounted to SEK 18,320 M (11,869). ➣ Currency movements had a positive impact on operating income of SEK 1,165 M. ➣ Earnings per share amounted to SEK 6.93 (4.24). ➣ Operating cash flow in the Industrial Operations amounted to SEK 5,609 M (14,611). ➣ Return on capital employed in the Industrial Operations amounted to 33.7% (27.4). Third quarter First nine months SEK M unless otherwise stated 2023 2022 2023 2022 Net sales 132,405 114,917 404,646 339,176 Adjusted operating income ¹ 19,114 11,869 59,254 38,295 Adjusted operating margin, % 14.4 10.3 14.6 11.3 Operating income 18,320 11,869 49,890 34,171 Operating margin, % 13.8 10.3 12.3 10.1 Income after financial items 18,636 11,758 49,843 34,657 Income for the period 14,093 8,687 37,846 26,279 Earnings per share, SEK 6.93 4.24 18.58 12.84 Operating cash flow in Industrial Operations 5,609 14,611 23,166 16,409 Net financial position in Industrial Operations, SEK bn ² 65.2 59.5 Return on capital employed in Industrial Operations, % ³ 33.7 27.4 Return on equity in Financial Services, % ³ 10.2 3.4 Return on equity in Financial Services excluding Russian and Belarus operations, % ³ 14.1 16.3 Net order intake, number of trucks 47,202 64,689 155,550 163,671 Deliveries, number of trucks 55,274 53,303 180,647 169,724 Net order intake, number of construction equipment 10,288 14,018 36,051 55,790 Deliveries, number of construction equipment 13,305 16,792 44,713 59,969 Net sales, SEK bn Adjusted operating income, SEK bn 1 Adjusted operating margin, % Return on capital employed Industrial Operations, % 3 114.9 132.4 Q3 2022 Q4 Q1 Q2 Q3 2023 11.9 19.110.3% 14.4% Q3 2022 Q4 Q1 Q2 Q3 2023 27.4% 33.7% Q3 2022 Q4 Q1 Q2 Q3 2023 1 For information on adjusted operating income, please see note 6. 2 Excluding post-employment benefits and lease liabilities. 3 12 months rolling. On the cover: Volvo Autonomous Solutions and Boliden have entered into a long-term collaboration to implement autonomous transport solutions as a part of Bolidenʼs operations. VOLVO GROUP — 2 — THE THIRD QUARTER 2023 ===== SIDA 3 ===== CEOʼS COMMENTS Strong sales and earnings In Q3 2023, the Volvo Group continued to deliver improved results, margins and profitability. Adjusted for currency, our net sales grew by 9% to SEK 132.4 billion and we increased the adjusted operating income to SEK 19.1 billion (11.9), corresponding to an adjusted operating margin of 14.4% (10.3). We have successfully mitigated cost inflation with price management and continued to handle disturbances in the supply chain. Return on capital employed increased to 33.7% (27.4). Our service sales grew by 10% adjusted for currency on the back of both continued good activity levels at our customers and our own focus on developing the service business. Operating cash flow in our Industrial Operations amounted to SEK 5.6 billion (14.6), impacted by an increase in working capital. At the end of the quarter, we had net financial assets of SEK 65.2 billion, excluding pension and lease liabilities. In Q3, order intake of new trucks declined by 27% to 47,202 vehicles, reflecting a gradual normalization of demand and our continued gradual opening of order books. Deliveries on the other hand, increased by 4% compared to the previous year and amounted to 55,274 trucks. We expect our major truck markets to continue to be strong throughout this year as we continue to deliver from our large order books to customers, but forecast lower market levels for next year. Also in Q3, supply disturbances affected productivity and costs, but had limited effect on deliveries thanks to hard work by colleagues in the Group and across the value chain. Net sales in our truck business grew by 13% adjusted for currency and amounted to SEK 89.9 billion, with strong sales in almost all regions. The adjusted operating margin increased to 15.6% (9.7). Construction Equipmentʼs net sales of SEK 24.3 billion were on the same level as last year, with strong deliveries in North America and continued weak demand in China. The adjusted operating margin amounted to 15.4% (15.6). However, demand is weakening in some markets and segments on the back of higher interest rates and an overall economic slowdown. Order intake decreased by 27%, because of lower demand in Europe and China whereas North America had a very strong order intake following the opening of order books for 2024. Net sales in Buses rose by 6% adjusted for currency and amounted to SEK 5.4 billion, supported by a continued recovery in demand for coaches and a good development in the service business. The adjusted operating margin improved to 6.3% (2.0). Despite somewhat weaker market conditions, Volvo Penta had a solid performance with net sales rising by 5%, currency adjusted, to SEK 5.0 billion and an adjusted operating margin that improved to 15.9% (13.3). For Volvo Financial Services, the credit portfolio continued to grow and credit losses remained low, reflecting continued good financial health at customers. The adjusted operating income amounted to SEK 1.1 billion (0.9). "We are driving the development in digitalization, electromobility and autonomy towards our net zero commitments with more efficient transport and infrastructure solutions. Our ability to maintain strong profitability is essential to keep the investment pace needed in the transformation of our industries." In the quarter, we achieved a milestone in autonomous solutions with the removal of the safety driver in an active commercial mining operation at the Brönnöy limestone quarry in Norway. We also announced that we have entered a long-term collaboration with Boliden to implement autonomous transport solutions as a part of their operations. We see a growing demand for clean, efficient, and safe urban transportation, and partnerships and collaboration are key to achieve this. In October, we announced that we will join forces with Renault Group and CMA CGM Group to address this demand with an all-new generation of fully electric and software-defined vans and associated services. Production is planned to start in 2026. We are driving the development in digitalization, electromobility and autonomy towards our net zero commitments with more efficient transport and infrastructure solutions. Our ability to maintain strong profitability is essential to keep the investment pace needed in the transformation of our industries. Martin Lundstedt President and CEO VOLVO GROUP — 3 — THE THIRD QUARTER 2023 ===== SIDA 4 ===== FINANCIAL SUMMARY OF THE THIRD QUARTER 2023 Net sales In Q3 2023, the Volvo Groupʼs net sales amounted to SEK 132,405 M compared with SEK 114,917 M in the same quarter the preceding year. The increase in net sales was mainly driven by Europe and North America. All segments increased net sales. Adjusted for currency movements, net sales increased by 9%, of which vehicle sales increased by 9% and service sales by 10%. Operating income In Q3 2023, adjusted operating income amounted to SEK 19,114 M (11,869), corresponding to an adjusted operating margin of 14.4% (10.3). The adjusted operating income in Q3 2023 excludes a negative effect of SEK 794 M from a loss on the divestment of the Group's Russian entities. There were no adjustments in Q3 2022. For more information on adjusted operating income, please see note 6. Compared with Q3 2022, the higher adjusted operating income is mainly an effect of price realization. This was partly offset by higher production costs as well as increased selling and R&D expenses. Currency movements, compared with Q3 2022 , had a positive impact of SEK 1,165 M. Reported operating income in Q3 2023 amounted to SEK 18,320 M (11,869). Net sales Third quarter Change % First nine months Change %SEK M 2023 2022 2023 2022 Net sales per geographical region Europe 53,318 43,275 23 170,392 137,461 24 North America 41,517 34,808 19 123,857 99,520 24 South America 13,468 14,190 -5 35,083 36,179 -3 Asia 14,922 14,878 - 49,175 45,133 9 Africa and Oceania 9,181 7,767 18 26,140 20,883 25 Total net sales 132,405 114,917 15 404,646 339,176 19 Net sales per product group Vehicles 99,997 87,111 15 310,032 259,379 20 Services 32,408 27,806 17 94,614 79,797 19 Total net sales 132,405 114,917 15 404,646 339,176 19 Timing of revenue recognition Revenue of vehicles and services recognized at the point of delivery 119,521 105,118 14 368,057 310,988 18 Revenue of vehicles and services recognized over contract period 12,884 9,799 31 36,589 28,188 30 Total net sales 132,405 114,917 15 404,646 339,176 19 Consolidated Income Statement Third quarter First nine months SEK M 2023 2022 2023 2022 Net sales 132,405 114,917 404,646 339,176 Cost of sales -96,026 -87,594 -294,037 -258,515 Gross income 36,380 27,324 110,609 80,662 Research and development expenses -6,305 -5,595 -19,616 -15,632 Selling expenses -8,202 -7,046 -24,426 -20,805 Administrative expenses -1,686 -1,383 -5,207 -4,136 Other operating income and expenses -1,180 -896 -10,033 -5,082 Income/loss from investments in joint ventures and associated companies -665 -536 -1,414 -982 Income/loss from other investments -22 1 -23 147 Operating income 18,320 11,869 49,890 34,171 Interest income and similar credits 656 247 1,800 555 Interest expenses and similar charges -272 -262 -848 -868 Other financial income and expenses -67 -96 -999 800 Income after financial items 18,636 11,758 49,843 34,657 Income taxes -4,543 -3,071 -11,997 -8,379 Income for the period * 14,093 8,687 37,846 26,279 * Attributable to: Owners of AB Volvo 14,092 8,627 37,772 26,102 Non-controlling interest 1 61 74 176 14,093 8,687 37,846 26,279 Basic earnings per share, SEK 6.93 4.24 18.58 12.84 Diluted earnings per share, SEK 6.93 4.24 18.58 12.84 VOLVO GROUP — 4 — THE THIRD QUARTER 2023 ===== SIDA 5 ===== Financial items In Q3 2023 , interest income was SEK 656 M ( 247) as a consequence of higher interest on financial assets, whereas interest expenses amounted to SEK 272 M (262). Other financial income and expenses amounted to SEK -67 M (-96). The change is primarily due to revaluation effects of financial assets and liabilities. Income taxes In Q3 2023, income taxes amounted to SEK 4,543 M (3,071). The tax rate was 24% (26). Income for the period and earnings per share In Q3 2023 , income for the period amounted to SEK 14,093 M (8,687). Earnings per share amounted to SEK 6.93 (4.24). Operating cash flow in the Industrial Operations During Q3 2023 , operating cash flow in the Industrial Operations was positive in an amount of SEK 5,609 M (14,611). Compared with Q3 2022 the lower operating cash flow is primarily related to a higher buildup of working capital, which was partly counterbalanced by the increased operating income. Operating cash flow Industrial Operations, SEK bn 14.6 5.6 Q3 2022 Q4 Q1 Q2 Q3 2023 Volvo Group financial position During Q3 2023 , net financial assets in the Industrial Operations, excluding provisions for post-employment benefits and lease liabilities, increased by SEK 3.6 billion resulting in a net financial asset position of SEK 65.2 billion on September 30, 2023 . The change is mainly explained by a positive operating cash flow of SEK 5.6 billion. Currency movements decreased net financial assets by SEK 0.5 billion. Including provisions for post-employment benefits and lease liabilities, the Industrial Operations net financial assets amounted to SEK 51.6 billion on September 30, 2023 . During Q3 2023 , remeasurements of defined benefit pension plans had a positive impact of SEK 0.5 billion. The remeasurements were primarily an effect of higher discount rates, partly offset by lower return on assets. On September 30, 2023 , total equity for the Volvo Group amounted to SEK 177.2 billion compared with SEK 166.2 billion at year-end 2022. The equity ratio was 26.1% ( 26.4). On the same date the equity ratio in the Industrial Operations amounted to 35.3% (34.1). Net financial position excl. post-employment benefits and lease liabilities Industrial Operations, SEK bn 59.5 65.2 Q3 2022 Q4 Q1 Q2 Q3 2023 Blue-collar 53,331 54,100 53,486 51,779 52,734 Whereof temporary employees and consultants 8,321 9,021 8,567 7,064 8,507 White-collar 51,547 51,096 50,765 50,376 49,949 Whereof temporary employees and consultants 7,285 7,341 7,366 7,405 7,426 Total number of employees 104,878 105,196 104,251 102,155 102,683 Whereof temporary employees and consultants 15,606 16,362 15,933 14,469 15,933 Number of employees Sep 30 2023 Jun 30 2023 Mar 31 2023 Dec 31 2022 Sep 30 2022 Number of employees On September 30, 2023, the Volvo Group had 104,878 employees, including temporary employees and consultants, compared with 102,683 employees on September 30 2022 . The number of blue- collar employees increased by 597 and the number of white-collar employees increased by 1,598. The increase in blue-collar employees is related to higher production levels and the increase in white-collar employees is related to higher development and transformational activities. VOLVO GROUP — 5 — THE THIRD QUARTER 2023 ===== SIDA 6 ===== IMPORTANT EVENTS FOR THE VOLVO GROUP Anna Müller new President Volvo Penta and member of Volvo Group management Anna Müller has been appointed as President Volvo Penta and member of Volvo Group management. On December 1, 2023, she will replace Heléne Mellquist who will leave the Volvo Group. Currently Anna Müller holds the position as Senior Vice President for the Europe North and Central Division at Volvo Trucks. Pär Boman proposed as new Chairman of AB Volvo The Election Committee of AB Volvo proposes that Pär Boman be appointed new Chairman and Board member at the Annual General Meeting in March 2024. AB Volvoʼs current Chairman of the Board, Carl-Henric Svanberg, has declined re-election. Previously reported important events • Volvo Buses changes business model in Europe and has decided to close its bodybuilding factory in Wroclaw in 2024 • Annual General Meeting of AB Volvo • Stephen Roy new member of the Volvo Group Executive Board and President of Mack Trucks • Nova Bus ends bus production in the US • Mats Backman new Chief Financial Officer and member of the Volvo Group Executive Board • Joint venture with Westport Detailed information about the events is available at www.volvogroup.com VOLVO GROUP — 6 — THE THIRD QUARTER 2023 ===== SIDA 7 ===== BUSINESS SEGMENT OVERVIEW Net sales Third quarter Change % Change %¹ First nine months Change % Change %¹ 12 months Jan-Dec SEK M 2023 2022 2023 2022 rolling 2022 Trucks 89,848 75,078 20 13 273,152 223,233 22 15 360,455 310,536 Construction Equipment 24,296 24,238 - -4 78,404 72,664 8 3 106,000 100,261 Buses 5,386 4,817 12 6 15,087 11,929 26 19 21,741 18,583 Volvo Penta 4,956 4,451 11 5 15,975 13,253 21 14 20,824 18,102 Group Functions & Other 3,954 3,793 4 -1 11,361 11,392 - -6 16,346 16,376 Eliminations -1,219 -950 - - -3,650 -2,980 - - -4,825 -4,155 Industrial Operations 127,220 111,427 14 8 390,329 329,491 18 12 520,541 459,703 Financial Services 6,249 4,430 41 34 17,470 12,231 43 34 22,594 17,355 Reclassifications and eliminations -1,064 -940 - - -3,153 -2,546 - - -4,186 -3,579 Volvo Group net sales 132,405 114,917 15 9 404,646 339,176 19 12 538,949 473,479 1 Adjusted for exchange rate fluctuations. Adjusted operating income ¹ Third quarter Change % First nine months Change % 12 months Jan-Dec SEK M 2023 2022 2023 2022 rolling 2022 Trucks 14,038 7,307 92 41,703 25,547 63 49,977 33,821 Construction Equipment 3,733 3,773 -1 13,673 10,151 35 16,766 13,244 Buses 340 99 245 736 126 484 964 353 Volvo Penta 790 593 33 2,865 2,061 39 3,333 2,530 Group Functions & Other -860 -778 -11 -2,598 -2,157 -20 -3,352 -2,911 Eliminations 11 -4 - 26 13 - 25 12 Industrial Operations 18,051 10,990 64 56,405 35,741 58 67,713 47,049 Financial Services 1,062 879 21 2,850 2,553 12 3,713 3,416 Reclassifications and eliminations - 1 - - 2 - 1 2 Volvo Group adjusted operating income 19,114 11,869 61 59,254 38,295 55 71,426 50,467 Adjustments ¹ -794 - - -9,364 -4,125 - -9,994 -4,755 Volvo Group operating income 18,320 11,869 54 49,890 34,171 46 61,432 45,712 1 For more information on adjusted operating income, please see note 6 Adjusted operating margin Third quarter First nine months 12 months Jan-Dec % 2023 2022 2023 2022 rolling 2022 Trucks 15.6 9.7 15.3 11.4 13.9 10.9 Construction Equipment 15.4 15.6 17.4 14.0 15.8 13.2 Buses 6.3 2.0 4.9 1.1 4.4 1.9 Volvo Penta 15.9 13.3 17.9 15.6 16.0 14.0 Industrial Operations 14.2 9.9 14.5 10.8 13.0 10.2 Volvo Group adjusted operating margin 14.4 10.3 14.6 11.3 13.3 10.7 Volvo Group operating margin 13.8 10.3 12.3 10.1 11.4 9.7 VOLVO GROUP — 7 — THE THIRD QUARTER 2023 ===== SIDA 8 ===== TRUCKS Strong earnings • In Q3, net sales increased by 13% adjusted for currency and amounted to SEK 89,848 M • Adjusted operating income increased to SEK 14,038 M (7,307) with a margin of 15.6% (9.7) • Order intake decreased by 27% while deliveries increased 4% Market development In Q3, truck fleet utilization in Europe and North America continued to be on good levels. In both regions, many of the larger fleets continue their replacement cycles while smaller companies are more cautious on the back of lower freight volumes and freight rates. In South America, the market is down year over year due to the prebuy of Euro 5 trucks in 2022. However, after the Euro 6 introduction on January 1, the market has gradually recovered, primarily driven by the agricultural and mining segments. The Indian market continued to grow with the support of increased economic activity and good consumer spending. In Q3, the truck market in China continued to rebound from low levels, but growth is expected to be limited due to the overcapacity in the Chinese transport industry. Orders and deliveries In Q3, the Volvo Groupʼs truck brands continued to gradually open order books. Total order intake in Q3 decreased by 27% to 47,202 trucks while total deliveries increased by 4% to 55,274 trucks. In Europe, order intake decreased by 35% to 21,154 trucks while deliveries increased by 11% to 26,546 trucks. Volvo Trucksʼ total heavy-duty market share through August decreased to 17.4% (18.9) while the electric heavy-duty market share increased to 48.3% (30.5). Renault Trucksʼ heavy-duty total market share decreased to 8.6% (9.7) and the electric heavy-duty market share decreased to 19.5% (22.9). Order intake in North America decreased by 7% to 17,355 trucks while deliveries increased by 13% to 15,041 vehicles. Volvo Trucksʼ heavy-duty truck market share through August decreased to 9.0% (10.3). Mack Trucksʼ market share was flat at 6.0% (5.9). In South America, order intake decreased by 27% to 4,284 trucks and deliveries decreased by 35% to 5,635 vehicles. In Brazil, Volvo Trucksʼ heavy-duty truck market share through September decreased to 23.7% (25.0). Order intake in Asia decreased by 43% to 2,796 vehicles while deliveries increased by 7% to 4,842 vehicles. The drop in order intake is mainly attributed to the Middle East. In Q3, order intake for fully electric trucks increased by 27% to 1,106 (872) vehicles and deliveries increased by 236% to 796 (237) vehicles. Order intake in the Indian joint venture, VE Commercial Vehicles, increased by 7% to 15,893 vehicles and deliveries increased by 12% to 16,088 vehicles. Deliveries from the Chinese joint venture, Dongfeng Commercial Vehicles increased by 35% to 20,495 trucks. Total market development First nine months Change % Full year Forecast Change vs. previous forecast Forecast Registrations, number of trucks 2023 2022 2022 2023 2024 Europe 29 ¹ heavy-duty 216,938 170,744 27 264,100 - - - Europe 30 ¹ heavy-duty 241,303 191,234 26 298,066 340,000 +10,000 290,000 North America heavy-duty (retail) 222,918 192,267 16 309,916 330,000 unchanged 290,000 Brazil heavy-duty 59,456 71,367 -17 97,856 80,000 unchanged 80,000 China ² medium- and heavy-duty 560,484 455,753 23 566,130 680,000 +30,000 700,000 India medium- and heavy-duty 290,453 261,517 11 350,797 400,000 unchanged 440,000 1 EU29 includes Norway and Switzerland but excludes UK. EU30 includes UK. 2 Previous year has been adjusted to exclude exports. VOLVO GROUP — 8 — THE THIRD QUARTER 2023 ===== SIDA 9 ===== Net order intake Third quarter Change % First nine months Change %Number of trucks 2023 2022 2023 2022 Europe 21,154 32,329 -35 77,284 83,908 -8 Heavy- and medium-duty 17,592 26,090 -33 62,123 68,056 -9 Light-duty 3,562 6,239 -43 15,161 15,852 -4 North America 17,355 18,641 -7 41,222 34,389 20 South America 4,284 5,837 -27 15,798 22,527 -30 Asia 2,796 4,889 -43 13,368 14,538 -8 Africa and Oceania 1,613 2,993 -46 7,878 8,309 -5 Total order intake 47,202 64,689 -27 155,550 163,671 -5 Heavy-duty (>16 tons) 38,687 52,891 -27 126,985 135,745 -6 Medium-duty (7-16 tons) 4,937 5,513 -10 13,265 11,839 12 Light-duty (<7 tons) 3,578 6,285 -43 15,300 16,087 -5 Total order intake 47,202 64,689 -27 155,550 163,671 -5 Volvo 24,519 38,309 -36 90,072 98,800 -9 Renault Trucks 10,662 14,608 -27 39,729 46,325 -14 Heavy- and medium-duty 7,084 8,323 -15 24,429 30,238 -19 Light-duty 3,578 6,285 -43 15,300 16,087 -5 Mack 11,950 11,416 5 24,987 17,540 42 Other brands 71 356 -80 762 1,006 -24 Total order intake 47,202 64,689 -27 155,550 163,671 -5 Non-consolidated operations VE Commercial Vehicles (Eicher) 15,893 14,902 7 50,575 46,514 9 Deliveries Third quarter Change % First nine months Change %Number of trucks 2023 2022 2023 2022 Europe 26,546 23,857 11 92,565 82,755 12 Heavy- and medium-duty 20,236 19,258 5 71,800 68,478 5 Light-duty 6,310 4,599 37 20,765 14,277 45 North America 15,041 13,312 13 47,012 42,293 11 South America 5,635 8,611 -35 15,495 23,236 -33 Asia 4,842 4,532 7 16,486 12,947 27 Africa and Oceania 3,210 2,991 7 9,089 8,493 7 Total deliveries 55,274 53,303 4 180,647 169,724 6 Heavy-duty (>16 tons) 44,795 45,174 -1 145,834 144,129 1 Medium-duty (7-16 tons) 4,086 3,509 16 13,760 11,174 23 Light-duty (<7 tons) 6,393 4,620 38 21,053 14,421 46 Total deliveries 55,274 53,303 4 180,647 169,724 6 Volvo 33,187 33,950 -2 105,431 106,067 -1 Renault Trucks 14,044 12,586 12 50,704 42,356 20 Heavy- and medium-duty 7,651 7,966 -4 29,651 27,935 6 Light-duty 6,393 4,620 38 21,053 14,421 46 Mack 7,749 6,375 22 23,667 20,045 18 Other brands 294 392 -25 845 1,256 -33 Total deliveries 55,274 53,303 4 180,647 169,724 6 Non-consolidated operations VE Commercial Vehicles (Eicher) 16,088 14,405 12 50,486 45,544 11 Dongfeng Commercial Vehicle Company (Dongfeng Trucks) 20,495 15,142 35 67,353 58,965 14 VOLVO GROUP — 9 — THE THIRD QUARTER 2023 ===== SIDA 10 ===== Net sales and operating income Third quarter Change % First nine months Change %SEK M 2023 2022 2023 2022 Net sales per geographical region Europe 39,522 30,379 30 125,279 98,369 27 North America 27,310 23,390 17 82,679 67,920 22 South America 9,880 10,448 -5 26,205 27,191 -4 Asia 7,001 5,838 20 22,604 16,428 38 Africa and Oceania 6,135 5,024 22 16,385 13,325 23 Total net sales 89,848 75,078 20 273,152 223,233 22 Net sales per product group Vehicles 71,388 58,562 22 218,993 176,047 24 Services 18,460 16,516 12 54,159 47,186 15 Total net sales 89,848 75,078 20 273,152 223,233 22 Timing of revenue recognition Revenue of vehicles and services recognized at the point of delivery 84,187 70,461 19 256,966 209,495 23 Revenue of vehicles and services recognized over contract period 5,661 4,617 23 16,186 13,738 18 Total net sales 89,848 75,078 20 273,152 223,233 22 Adjusted operating income ¹ 14,038 7,307 92 41,703 25,547 63 Adjustments -640 232 - -6,501 -1,215 - Operating income 13,397 7,539 78 35,201 24,332 45 Adjusted operating margin, % 15.6 9.7 15.3 11.4 Operating margin, % 14.9 10.0 12.9 10.9 1 For more information on adjusted operating income, please see note 6. Net sales and operating income In Q3 2023 , the truck operationʼs net sales amounted to SEK 89,848 M, which was 20% higher than in Q3 2022 . Excluding currency effects, net sales increased by 13% with sales of vehicles increasing by 16% and sales of services by 5%. In Q3 2023, adjusted operating income increased to SEK 14,038 (7,307), corresponding to an adjusted operating margin of 15.6% (9.7). Adjusted operating income excludes a negative effect of SEK 640 M from a loss on the divestment of the Russian entities. For more information on adjusted operating income, see note 6. Compared with Q3 2022, the higher adjusted operating income is an effect of price realization whereas higher production costs as well as increased R&D and selling expenses had a negative impact. Compared with Q3 2022 , currency movements had a positive impact of SEK 872 M. Reported operating income amounted to SEK 13,397 M (7,539). Important events In Q3, Renault Trucks started taking orders for heavy-duty electric trucks and serial production will begin in Bourg-en-Bresse, France in November. Volvo Autonomous Solutions entered a long-term collaboration with Boliden to deploy autonomous solutions in Bolidenʼs mining operations. In October, Volvo Defense entered a 7-year framework agreement for delivery and service of logistics trucks to Estonia and Latvia. In October, it was announced that Volvo Group, Renault Group and CMA CGM Group will join forces to address the growing needs of decarbonized and efficient logistics with an all-new generation of fully electric vans. For this purpose, a new company is planned to be established in the beginning of 2024 with a planned start of production in 2026. On October 8, the United Auto Workers (UAW) union informed Mack Trucks that their members had voted against ratification of a new five-year collective bargaining agreement covering about 3,900 employees at facilities in Pennsylvania, Maryland and Florida, including the powertrain plant, which supports the production of both Mack Trucks and Volvo, and Mack Trucksʼ assembly plant. Beginning on October 9, the UAW strike at all the covered facilities. Net order intake of fully electric trucks Third quarter Change % First nine months Change %Number of trucks 2023 2022 2023 2022 Volvo 631 411 54 1,527 1,225 25 Renault Trucks 390 438 -11 972 1,206 -19 Heavy- and medium-duty 285 196 45 572 507 13 Light-duty 105 242 -57 400 699 -43 Mack 85 23 270 109 32 241 Total order intake 1,106 872 27 2,608 2,463 6 Deliveries of fully electric trucks Third quarter Change % First nine months Change %Number of trucks 2023 2022 2023 2022 Volvo 335 88 281 1,022 232 341 Renault Trucks 450 149 202 1,198 406 195 Heavy- and medium-duty 158 92 72 454 267 70 Light-duty 292 57 412 744 139 435 Mack 11 - - 18 8 125 Total deliveries 796 237 236 2,238 646 246 VOLVO GROUP — 10 — THE THIRD QUARTER 2023 ===== SIDA 11 ===== CONSTRUCTION EQUIPMENT Stable earnings and margin • In Q3, order intake decreased by 27% and deliveries decreased by 21% • Adjusted operating income amounted to SEK 3,733 M (3,773), with a margin of 15.4% (15.6) • Service sales increased by 4%, adjusted for currency Market development Overall, in Q3 the total market development remained good compared to last year in all major markets except Asia. North America grew while Europe was stable with some signs of softening towards the end of the quarter. Asia outside of China was flat while China and Latin America declined. The North American market grew supported by continued large infrastructure projects and a strong commercial construction sector that more than offset weaker residential construction amid rising interest rates. In Q3, the market in Europe softened somewhat compared to last year due to a weakening macroeconomic outlook and increasing interest rates. The market in South America declined on the back of low investment levels in Brazil and low business confidence among customers. Chinese market demand weakened substantially compared to last year driven by a drop in real estate investments and overall slower economic activity. Development in other Asian markets was flat with increased demand in India, Japan, and the Middle East and a slowdown in markets such as South Korea and Indonesia. Orders and deliveries In Q3, net order intake declined by 27%. The decline was largely driven by lower demand in China following the economic slowdown as well as by cautiousness among customers and dealers in Europe. Order intake in North America was supported by strong underlying demand as well as replenishment of dealer rental fleets. In Q3, deliveries decreased by 21% driven by lower deliveries to China, a slowdown in Brazil and somewhat weakening demand coupled with supply challenges in Europe. Deliveries in North America grew supported by favorable market and macroeconomic conditions. Total market development Year-to-date August Forecast Previous forecast Forecast Change in % measured in units 2023 2023 2023 2024 Europe 4 -5% to +5% -5% to +5% -15% to -5% North America 10 0% to +10% 0% to +10% -10% to 0% South America -25 -20% to -10% -20% to -10% 0% to +10% Asia excl. China 3 -5% to +5% -5% to +5% -15% to -5% China -40 -40% to -30% -40% to -30% -10% to 0% Net order intake Third quarter Change % First nine months Change %Number of construction equipment 2023 2022 2023 2022 Europe 1,302 2,966 -56 6,810 11,883 -43 North America 2,146 726 196 5,806 4,025 44 South America 485 605 -20 1,601 2,115 -24 Asia 5,721 8,968 -36 19,519 35,293 -45 Africa and Oceania 634 753 -16 2,315 2,474 -6 Total orders 10,288 14,018 -27 36,051 55,790 -35 Large and medium construction equipment 8,203 10,057 -18 28,037 38,488 -27 Compact construction equipment 2,085 3,961 -47 8,014 17,302 -54 Of which fully electric 217 166 31 681 478 42 Total orders 10,288 14,018 -27 36,051 55,790 -35 Of which: Volvo 5,641 6,620 -15 20,917 25,233 -17 SDLG 4,570 7,347 -38 14,917 30,385 -51 Of which in China 3,525 6,075 -42 10,881 25,097 -57 VOLVO GROUP — 11 — THE THIRD QUARTER 2023 ===== SIDA 12 ===== Deliveries Third quarter Change % First nine months Change %Number of construction equipment 2023 2022 2023 2022 Europe 3,590 3,735 -4 12,629 12,950 -2 North America 2,425 1,825 33 7,409 5,527 34 South America 585 1,373 -57 1,628 3,840 -58 Asia 5,933 8,937 -34 20,242 35,106 -42 Africa and Oceania 772 922 -16 2,805 2,546 10 Total deliveries 13,305 16,792 -21 44,713 59,969 -25 Large and medium construction equipment 10,143 12,457 -19 33,711 42,056 -20 Compact construction equipment 3,162 4,335 -27 11,002 17,913 -39 Of which fully electric 239 146 64 669 428 56 Total deliveries 13,305 16,792 -21 44,713 59,969 -25 Of which: Volvo 8,658 9,394 -8 29,579 29,412 1 SDLG 4,570 7,347 -38 14,917 30,385 -51 Of which in China 3,525 6,075 -42 10,881 25,097 -57 Net sales and operating income Third quarter Change % First nine months Change %SEK M 2023 2022 2023 2022 Net sales per geographical region Europe 7,638 7,321 4 25,662 22,316 15 North America 7,706 5,569 38 22,366 16,000 40 South America 1,132 2,016 -44 2,995 4,996 -40 Asia 5,944 7,487 -21 21,083 24,332 -13 Africa and Oceania 1,876 1,845 2 6,297 5,021 25 Total net sales 24,296 24,238 - 78,404 72,664 8 Net sales per product group Construction equipment 20,272 20,497 -1 66,446 61,634 8 Services 4,024 3,741 8 11,958 11,031 8 Total net sales 24,296 24,238 - 78,404 72,664 8 Timing of revenue recognition Revenue of vehicles and services recognized at the point of delivery 23,504 23,515 - 76,272 70,720 8 Revenue of vehicles and services recognized over contract period 792 723 10 2,132 1,945 10 Total net sales 24,296 24,238 - 78,404 72,664 8 Adjusted operating income ¹ 3,733 3,773 -1 13,673 10,151 35 Adjustments - -232 - - -338 - Operating income 3,733 3,541 5 13,673 9,813 39 Adjusted operating margin, % 15.4 15.6 17.4 14.0 Operating margin, % 15.4 14.6 17.4 13.5 1 For more information on adjusted operating income, please see note 6. Net sales and operating income In Q3 2023 , net sales amounted to SEK 24,296 M ( 24,238). Adjusted for currency movements net sales decreased by 4%, of which net sales of machines decreased by 5% while service sales increased by 4%. Adjusted operating income amounted to SEK 3,733 M (3,773), corresponding to an adjusted operating margin of 15.4% (15.6). There were no adjustments in Q3 2023. For more information on adjusted operating income, see note 6. Compared with Q3 2022, negative impacts from lower volumes, increased production costs and higher selling expenses were almost compensated for by price realization and a favorable brand and market mix. Compared with Q3 2022, currency movements had a positive impact of SEK 67 M. Reported operating income amounted to SEK 3,733 M (3,541). Important events During Q3, Volvo CE delivered its first electric power unit to a customer in Sweden. The power unit allows high power charging of electric machines in remote locations where access to stable power sources is limited. Previously launched in Norway, the companyʼs largest fully electric excavator, the EC230, was further offered to customers in the Netherlands, Sweden, Germany, the UK and France. In North America, Volvo CE inaugurated a new innovation center to provide training for technicians on diesel and electric heavy equipment, machine control technology, connectivity and productivity services. VOLVO GROUP — 12 — THE THIRD QUARTER 2023 ===== SIDA 13 ===== BUSES Improved service sales and profitability • In Q3, order intake increased by 6% and deliveries by 4% • Both adjusted and reported operating income increased to SEK 340 M (99) with a margin of 6.3% (2.0) • Service sales increased by 13%, adjusted for currency In Q3, global demand for new buses continued to be good, particularly for coaches. In the city bus segment, demand for electric buses continued to increase. Compared with Q3 2022, net order intake increased by 6% to 1,587 units, primarily supported by large coach orders in North America and electric bus orders to Warrington Borough Council and Lothian Buses in the UK. Deliveries increased by 4% to 1,420 units, with higher deliveries in North America, Asia, and Africa and Oceania, but with lower deliveries in South America and Europe. In Q3, net sales increased by 12% to SEK 5,386 M ( 4,817). Adjusted for currency, net sales increased by 6%, whereof vehicle sales increased by 4% and service sales by 13%. Both adjusted and reported operating income amounted to SEK 340 M ( 99), corresponding to an operating margin of 6.3% ( 2.0). Compared with Q3 2022, the higher operating income is an effect of price realization, increased service sales and improved production efficiency, whereas material costs increased. Compared with Q3 2022, currency movements had a positive impact of SEK 86 M. During Q3, Volvo Buses signed an agreement with MCV in Egypt for the manufacture of bodies for the Volvo 7900 Electric and Volvo 7900 Electric Artic, and later for an electric bus for intercity traffic, supporting the new business model for Europe announced in Q1. In September, the rollout of the 100% electric BZL chassis continued with Brazil with a demonstration of the bus in real operation in Curitiba. Net order intake and deliveries ¹ Third quarter Change % First nine months Change %Number of buses 2023 2022 2023 2022 Total orders 1,587 1,492 6 5,169 4,678 10 Of which fully electric 207 103 101 572 233 145 Of which hybrids 2 55 -96 9 107 -92 Total deliveries 1,420 1,359 4 3,881 3,601 8 Of which fully electric 31 77 -60 196 147 33 Of which hybrids 30 73 -59 126 122 3 Net sales and operating income Third quarter Change % First nine months Change %SEK M 2023 2022 2023 2022 Net sales per geographical region Europe 1,387 1,659 -16 4,696 4,111 14 North America 2,111 1,593 32 5,959 4,370 36 South America 865 741 17 1,542 1,349 14 Asia 452 419 8 1,180 981 20 Africa and Oceania 571 405 41 1,709 1,118 53 Total net sales 5,386 4,817 12 15,087 11,929 26 Net sales per product group Vehicles 3,994 3,646 10 11,061 8,751 26 Services 1,391 1,171 19 4,026 3,178 27 Total net sales 5,386 4,817 12 15,087 11,929 26 Timing of revenue recognition Revenue of vehicles and services recognized at the point of delivery 5,123 4,614 11 14,396 11,385 26 Revenue of vehicles and services recognized over contract period 263 202 30 690 544 27 Total net sales 5,386 4,817 12 15,087 11,929 26 Adjusted operating income ¹ 340 99 245 736 126 484 Adjustments - - - -1,439 - - Operating income 340 99 245 -703 126 -658 Adjusted operating margin, % 6.3 2.0 4.9 1.1 Operating margin, % 6.3 2.0 -4.7 1.1 1 For more information on adjusted operating income, please see note 6. VOLVO GROUP — 13 — THE THIRD QUARTER 2023 ===== SIDA 14 ===== VOLVO PENTA Increased earnings • In Q3, net sales increased by 5% adjusted for currency while order intake decreased by 28% • Both adjusted and reported operating income increased to SEK 790 M (593), with a margin of 15.9% (13.3) • A new dealership agreement for Swedish industrial sales was signed with Swecon In Q3, there was a slowdown in demand in both the marine and industrial segments. In marine leisure, there was a general decline in demand, most accentuated for smaller power boats. Within marine commercial, demand continued to be high, especially for supply boats and patrol vessels. The market for industrial power generation slowed down in Europe and the Middle East while the industrial off- road market started to show a more general decline. The construction segment weakened in Europe and remained on low levels in China. Demand within material handling and mining also slowed down. Supply chain disturbances continued to affect lead times and deliveries negatively. Net order intake decreased by 28% to 7,789 units while deliveries decreased by 9% to 9,811 units. Net sales increased by 11% to SEK 4,956 M (4,451). Adjusted for currency movements, net sales increased by 5%, of which sales of engines increased by 5% and sales of services by 6%. Both adjusted and reported operating income amounted to SEK 790 M (593), corresponding to an operating margin of 15.9% (13.3). Price realization and a favorable product mix contributed positively, but was partly offset by higher material costs, lower production efficiency and increased selling expenses. Compared with Q3 2022, the currency impact was positive in an amount of SEK 136 M. Volvo Pentaʼs development of a specialized dealer network to better meet customer demands continued with Volvo Construction Equipmentʼs long-standing Swedish distributor Swecon being appointed Volvo Penta dealer for industrial sales in Sweden. Net order intake and deliveries Third quarter Change % First nine months Change %Number of Engines 2023 2022 2023 2022 Total orders 7,789 10,866 -28 29,880 34,822 -14 Of which fully electric 43 -3 - 73 15 387 Total deliveries 9,811 10,735 -9 33,799 33,850 - Of which fully electric 30 6 400 81 15 440 Net sales and operating income Third quarter Change % First nine months Change %SEK M 2023 2022 2023 2022 Net sales per geographical region Europe 2,434 2,185 11 8,278 6,945 19 North America 1,058 1,008 5 3,156 2,756 15 South America 199 165 20 548 481 14 Asia 947 836 13 2,950 2,327 27 Africa and Oceania 318 257 24 1,043 744 40 Total net sales 4,956 4,451 11 15,975 13,253 21 Net sales per product group Engines 3,499 3,133 12 11,649 9,508 23 Services 1,458 1,318 11 4,326 3,745 16 Total net sales 4,956 4,451 11 15,975 13,253 21 Timing of revenue recognition Revenue of vehicles and services recognized at the point of delivery 4,947 4,451 11 15,956 13,253 20 Revenue of vehicles and services recognized over contract period 10 - - 19 - - Total net sales 4,956 4,451 11 15,975 13,253 21 Adjusted operating income ¹ 790 593 33 2,865 2,061 39 Adjustments - - - - -3 - Operating income 790 593 33 2,865 2,059 39 Adjusted operating margin, % 15.9 13.3 17.9 15.6 Operating margin, % 15.9 13.3 17.9 15.5 1 For more information on adjusted operating income, please see note 6. VOLVO GROUP — 14 — THE THIRD QUARTER 2023 ===== SIDA 15 ===== FINANCIAL SERVICES Good portfolio growth and stable performance • In Q3, new business volume increased by 13%, adjusted for currency • Adjusted operating income increased to SEK 1,062 M (879) • Stable portfolio performance In Q3 2023, new business volume increased by 13%, adjusted for currency, with stable penetration levels and continued high sales of Group products. The credit portfolio increased by 20% compared with Q3 2022, adjusted for currency. Customer activity levels continued to be high, resulting in stable portfolio performance in most parts of the world. Adjusted operating income increased to SEK 1,062 M (879) ex- cluding a loss on the divestment of the Russian entities of SEK 136 M. For more information on adjusted operating income, see note 6. The increase in adjusted operating income is primarily a result of continued profitable portfolio growth, which was partly offset by spread compression. Currency movements had a positive impact of SEK 36 M compared with Q3 2022. Reported operating income amounted to SEK 927 (879). Return on equity increased to 10.2% (3.4). Excluding Russia and Belarus, return on equity amounted to 14.1% (16.3). Financial Services Third quarter First nine months SEK M unless otherwise stated 2023 2022 2023 2022 Number of financed units, 12 months rolling 67,734 70,052 Total penetration rate, 12 months rolling, % ¹ 27 29 New retail financing volume, SEK billion 29.2 24.8 83.5 73.0 Credit portfolio net, SEK billion 255 211 Credit portfolio net excluding Russian and Belarus operations, SEK billion 255 208 Credit provision expenses 150 100 418 3,173 Credit provision expenses excluding Russian and Belarus operations 172 101 449 206 Adjusted operating income ² 1,062 879 2,850 2,553 Adjustments ² -136 - -136 -2,568 Operating income 927 879 2,714 -15 Credit reserves, % of credit portfolio 1.42 3.12 Credit reserves, % of credit portfolio excluding Russian and Belarus operations 1.42 1.73 Return on equity, 12 months rolling, % 10.2 3.4 Return on equity excluding Russian and Belarus operations, 12 months rolling, % 14.1 16.3 1 Share of unit sales financed by Volvo Financial Services in relation to the total number of units sold by the Volvo Group in markets where financial services are offered. 2 For more information on adjustments, please see note 6. VOLVO GROUP — 15 — THE THIRD QUARTER 2023 ===== SIDA 16 ===== CONSOLIDATED INCOME STATEMENT THIRD QUARTER Industrial Operations Financial Services Eliminations Volvo Group SEK M 2023 2022 2023 2022 2023 2022 2023 2022 Net sales 127,220 111,427 6,249 4,430 -1,064 -940 132,405 114,917 Cost of sales -92,819 -85,783 -4,271 -2,751 1,064 940 -96,026 -87,594 Gross income 34,402 25,644 1,978 1,679 - 1 36,380 27,324 Research and development expenses -6,305 -5,595 - - - - -6,305 -5,595 Selling expenses -7,399 -6,301 -803 -744 - - -8,202 -7,046 Administrative expenses -1,682 -1,380 -4 -3 - - -1,686 -1,383 Other operating income and expenses -936 -843 -245 -53 - - -1,180 -896 Income/loss from investments in joint ventures and associated companies -665 -536 - - - - -665 -536 Income/loss from other investments -22 1 - - - - -22 1 Operating income 17,393 10,990 927 879 - 1 18,320 11,869 Interest income and similar credits 800 352 - - -144 -105 656 247 Interest expenses and similar charges -417 -367 - - 144 105 -272 -262 Other financial income and expenses -67 -96 - - - - -67 -96 Income after financial items 17,710 10,878 927 879 - 1 18,636 11,758 Income taxes -4,262 -2,840 -282 -231 - - -4,543 -3,071 Income for the period * 13,448 8,039 645 648 - - 14,093 8,687 * Attributable to: Owners of AB Volvo 14,092 8,627 Non-controlling interest 1 61 14,093 8,687 Basic earnings per share, SEK 6.93 4.24 Diluted earnings per share, SEK 6.93 4.24 Key ratios, % Gross margin 27.0 23.0 27.5 23.8 Research and development expenses as % of net sales 5.0 5.0 4.8 4.9 Selling expenses as % of net sales 5.8 5.7 6.2 6.1 Administrative expenses as % of net sales 1.3 1.2 1.3 1.2 Operating margin 13.7 9.9 13.8 10.3 CONSOLIDATED OTHER COMPREHENSIVE INCOME THIRD QUARTER SEK M 2023 2022 Income for the period 14,093 8,687 Items that will not be reclassified to income statement: Remeasurements of defined benefit pension plans 335 -303 Remeasurements of holding of shares at fair value -3 3 Items that may be reclassified subsequently to income statement: Exchange differences on translation of foreign operations -2,015 4,073 Share of OCI related to joint ventures and associated companies -301 549 Accumulated translation difference reversed to income -318 - Other comprehensive income, net of income taxes -2,303 4,322 Total comprehensive income for the period * 11,791 13,009 * Attributable to: Owners of AB Volvo 11,809 12,855 Non-controlling interest -18 154 11,791 13,009 VOLVO GROUP — 16 — THE THIRD QUARTER 2023 ===== SIDA 17 ===== CONSOLIDATED INCOME STATEMENT FIRST NINE MONTHS Industrial Operations Financial Services Eliminations Volvo Group SEK M 2023 2022 2023 2022 2023 2022 2023 2022 Net sales 390,329 329,491 17,470 12,231 -3,153 -2,546 404,646 339,176 Cost of sales -285,314 -253,762 -11,876 -7,300 3,153 2,548 -294,037 -258,515 Gross income 105,015 75,729 5,594 4,931 - 2 110,609 80,662 Research and development expenses -19,616 -15,632 - - - - -19,616 -15,632 Selling expenses -21,995 -18,680 -2,430 -2,125 - - -24,426 -20,805 Administrative expenses -5,196 -4,126 -11 -9 - - -5,207 -4,136 Other operating income and expenses -9,599 -2,271 -434 -2,812 - - -10,033 -5,082 Income/loss from investments in joint ventures and associated companies -1,414 -982 - - - - -1,414 -982 Income/loss from other investments -18 147 -5 - - - -23 147 Operating income 47,176 34,184 2,714 -15 - 2 49,890 34,171 Interest income and similar credits 2,229 728 - - -430 -173 1,800 555 Interest expenses and similar charges -1,278 -1,041 - - 430 173 -848 -868 Other financial income and expenses -999 800 - - - - -999 800 Income after financial items 47,129 34,671 2,714 -15 - 2 49,843 34,657 Income taxes -11,236 -8,264 -761 -115 - - -11,997 -8,379 Income for the period * 35,893 26,407 1,953 -130 - 1 37,846 26,279 * Attributable to: Owners of AB Volvo 37,772 26,102 Non-controlling interest 74 176 37,846 26,279 Basic earnings per share, SEK 18.58 12.84 Diluted earnings per share, SEK 18.58 12.84 Key ratios, % Gross margin 26.9 23.0 27.3 23.8 Research and development expenses as % of net sales 5.0 4.7 4.8 4.6 Selling expenses as % of net sales 5.6 5.7 6.0 6.1 Administrative expenses as % of net sales 1.3 1.3 1.3 1.2 Operating margin 12.1 10.4 12.3 10.1 CONSOLIDATED OTHER COMPREHENSIVE INCOME FIRST NINE MONTHS SEK M 2023 2022 Income for the period 37,846 26,279 Items that will not be reclassified to income statement: Remeasurements of defined benefit pension plans 318 8,112 Remeasurements of holding of shares at fair value 6 -39 Items that may be reclassified subsequently to income statement: Exchange differences on translation of foreign operations 1,728 14,784 Share of OCI related to joint ventures and associated companies 243 1,708 Accumulated translation difference reversed to income -318 - Other comprehensive income, net of income taxes 1,978 24,566 Total comprehensive income for the period * 39,824 50,844 * Attributable to: Owners of AB Volvo 39,782 50,342 Non-controlling interest 42 502 39,824 50,844 VOLVO GROUP — 17 — THE THIRD QUARTER 2023 ===== SIDA 18 ===== CONSOLIDATED BALANCE SHEET Industrial Operations Financial Services Eliminations Volvo Group SEK M Sep 30 2023 Dec 31 2022 Sep 30 2023 Dec 31 2022 Sep 30 2023 Dec 31 2022 Sep 30 2023 Dec 31 2022 Assets Non-current assets Intangible assets 43,305 41,471 88 73 - - 43,393 41,544 Tangible assets Property, plant and equipment 68,619 63,112 67 50 - - 68,687 63,162 Assets under operating leases 34,947 34,109 21,701 21,372 -13,738 -11,963 42,911 43,518 Financial assets Investments in Joint Ventures and associated companies 20,614 21,583 - - - - 20,614 21,583 Other shares and participations 869 587 19 18 - - 888 605 Non-current customer-financing receivables 1,809 1,903 120,630 105,536 -2,080 -2,375 120,360 105,064 Net pension assets 2,809 2,722 2 5 - - 2,811 2,727 Non-current interest-bearing receivables 2,798 7,227 - 1,153 -927 -6,578 1,871 1,803 Other non-current receivables 9,582 10,997 285 227 -213 -202 9,654 11,022 Deferred tax assets 15,400 12,219 2,118 1,969 - - 17,518 14,189 Total non-current assets 200,752 195,931 144,912 130,404 -16,957 -21,118 328,706 305,217 Current assets Inventories 92,695 75,382 407 307 - - 93,101 75,689 Current receivables Customer-financing receivables 1,239 1,128 112,521 89,145 -1,503 -1,409 112,257 88,864 Tax assets 5,959 1,489 632 570 - - 6,591 2,059 Interest-bearing receivables 6,556 5,690 - - -22 -27 6,534 5,663 Internal funding 4,687 7,991 - - -4,687 -7,991 - - Accounts receivable 45,574 46,672 1,766 1,548 - - 47,340 48,220 Other receivables 22,350 21,390 2,341 3,302 -4,577 -5,319 20,115 19,373 Marketable securities 95 93 - - - - 95 93 Cash and cash equivalents 61,455 76,005 4,806 9,688 -1,113 -1,806 65,148 83,886 Assets held for sale 263 - - - - - 263 - Total current assets 240,872 235,840 122,473 104,560 -11,902 -16,553 351,444 323,847 Total assets 441,624 431,771 267,385 234,964 -28,859 -37,671 680,150 629,064 Equity and liabilities Equity attributable to owners of AB Volvo 152,540 143,921 21,387 18,796 - - 173,927 162,717 Non-controlling interest 3,297 3,519 - - - - 3,296 3,519 Total equity 155,837 147,439 21,386 18,796 - - 177,223 166,236 Non-current provisions Provisions for post-employment benefits 8,881 8,690 60 55 - - 8,940 8,745 Other provisions 13,954 12,330 76 66 - - 14,030 12,396 Non-current liabilities Bond loans 96,756 102,887 - - - - 96,756 102,887 Other loans 26,830 25,446 12,858 12,325 -1,800 -2,086 37,887 35,684 Internal funding -111,667 -110,254 106,947 98,310 4,720 11,944 - - Deferred tax liabilities 3,330 3,060 2,335 2,412 - - 5,665 5,472 Other liabilities 53,839 51,351 1,598 1,467 -8,879 -7,270 46,558 45,549 Current provisions 19,662 13,095 15 24 - - 19,678 13,119 Current liabilities Bond loans 51,555 37,794 - - - - 51,555 37,794 Other loans 42,937 24,666 10,720 11,163 -1,187 -1,247 52,470 34,583 Internal funding -88,508 -50,804 100,641 79,677 -12,133 -28,873 - - Trade payables 83,947 89,174 1,021 1,003 - - 84,968 90,177 Tax liabilities 10,175 6,147 813 760 - - 10,988 6,907 Other liabilities 74,094 70,749 8,915 8,906 -9,581 -10,138 73,429 69,517 Liabilities held for sale 2 - - - - - 2 - Total equity and liabilities 441,624 431,771 267,385 234,964 -28,859 -37,671 680,150 629,064 Key ratios, % Equity ratio 35.3 34.1 8.0 8.0 26.1 26.4 Equity attributable to owners of AB Volvo, per share in SEK 85.5 80.0 Return on operating capital ¹ 66.0 50.8 Return on capital employed ¹ 33.7 27.4 Return on equity ¹ 10.2 -0.3 26.1 20.7 1 12 months rolling. VOLVO GROUP — 18 — THE THIRD QUARTER 2023 ===== SIDA 19 ===== CONSOLIDATED CASH FLOW STATEMENT THIRD QUARTER Industrial Operations Financial Services Eliminations Volvo Group SEK M 2023 2022 2023 2022 2023 2022 2023 2022 Operating activities Operating income 17,393 10,990 927 879 - 1 18,320 11,869 Amortization intangible assets 743 738 6 14 - - 749 752 Depreciation tangible assets 2,256 2,022 5 7 - - 2,261 2,028 Depreciation leasing vehicles 1,058 1,068 1,266 1,193 - - 2,324 2,261 Other non-cash items 753 610 341 91 - -93 1,094 608 Total change in working capital whereof -8,370 5,887 -8,215 -4,269 26 45 -16,560 1,663 Change in accounts receivables 2,130 2,394 31 4 - - 2,162 2,398 Change in customer-financing receivables -6 -176 -7,946 -4,672 45 146 -7,908 -4,702 Change in inventories -2,034 1,187 -142 58 - - -2,176 1,245 Change in trade payables -9,767 2,051 134 -2 - - -9,633 2,050 Other changes in working capital 1,308 431 -292 343 -19 -100 997 673 Dividends received from joint ventures and associated companies - 6 - - - - - 6 Interest and similar items received 735 264 - - -144 28 590 291 Interest and similar items paid -372 -176 - - 159 64 -213 -112 Other financial items -19 -150 - - - - -19 -150 Income taxes paid -4,306 -2,480 -218 -188 - - -4,525 -2,668 Cash flow from operating activities 9,871 18,779 -5,889 -2,273 40 45 4,022 16,551 Investing activities Investments in intangible assets -1,051 -1,521 -10 -12 - - -1,061 -1,533 Investments in tangible assets -3,264 -2,733 -10 -3 - - -3,274 -2,737 Investment in leasing vehicles - - -2,292 -2,092 4 3 -2,288 -2,089 Disposals of in-/tangible assets and leasing vehicles 54 86 1,068 963 -4 - 1,118 1,049 Operating cash flow 5,609 14,611 -7,132 -3,417 40 48 -1,483 11,241 Investments of shares -15 -426 Divestment of shares 316 - Acquired operations -16 -203 Divested operations -2,499 - Interest-bearing receivables incl. marketable securities -32 -23 Cash flow after net investments -3,730 10,589 Financing activities New borrowings ¹ 75,387 34,257 Repayments of borrowings ¹ -69,168 -28,538 Dividend to owners of AB Volvo - - Dividend to non-controlling interest -235 -19 Other -26 -2 Change in cash and cash equivalents excl. translation differences 2,228 16,285 Translation difference on cash and cash equivalents -898 1,353 Change in cash and cash equivalents 1,329 17,638 Cash and cash equivalents, beginning of quarter 63,819 54,268 Cash and cash equivalents, end of quarter 65,148 71,906 1 The comparative figures are restated due to a reclassification between new borrowings and repayments of borrowings. VOLVO GROUP — 19 — THE THIRD QUARTER 2023 ===== SIDA 20 ===== CONSOLIDATED CASH FLOW STATEMENT FIRST NINE MONTHS Industrial Operations Financial Services Eliminations Volvo Group SEK M 2023 2022 2023 2022 2023 2022 2023 2022 Operating activities Operating income 47,176 34,184 2,714 -15 - 2 49,890 34,171 Amortization intangible assets 2,229 2,162 22 40 - - 2,251 2,201 Depreciation tangible assets 6,444 5,835 16 19 - - 6,460 5,854 Depreciation leasing vehicles 3,272 3,391 3,750 3,459 - - 7,022 6,850 Other non-cash items 9,453 2,727 826 3,237 -1 -216 10,278 5,747 Total change in working capital whereof -21,035 -13,628 -30,651 -13,808 -497 74 -52,184 -27,362 Change in accounts receivables 2,229 -1,292 -329 -65 - - 1,900 -1,356 Change in customer-financing receivables 65 -181 -31,088 -15,445 -325 145 -31,348 -15,482 Change in inventories -16,896 -8,770 -145 -22 - - -17,041 -8,792 Change in trade payables -6,858 -2,712 -6 80 - - -6,865 -2,631 Other changes in working capital 426 -673 916 1,643 -173 -71 1,170 899 Dividends received from joint ventures and associated companies 108 60 - - - - 108 60 Interest and similar items received 2,250 507 - - -430 131 1,820 637 Interest and similar items paid -1,401 -834 - - 451 84 -950 -750 Other financial items -177 -203 - - - - -177 -203 Income taxes paid -13,850 -7,152 -886 -1,329 - - -14,736 -8,480 Cash flow from operating activities 34,470 27,048 -24,209 -8,397 -478 74 9,783 18,725 Investing activities Investments in intangible assets -3,578 -4,185 -38 -24 - - -3,617 -4,209 Investments in tangible assets -8,347 -6,751 -16 -8 - - -8,363 -6,759 Investment in leasing vehicles - -1 -6,764 -6,346 36 8 -6,728 -6,339 Disposals of in-/tangible assets and leasing vehicles 621 298 3,382 3,836 -8 -6 3,995 4,129 Operating cash flow 23,166 16,409 -27,646 -10,939 -450 76 -4,930 5,546 Investments of shares -959 -1,050 Divestments of shares 323 157 Acquired operations ¹ 333 -239 Divested operations -2,303 153 Interest-bearing receivables incl. marketable securities -215 -76 Cash flow after net investments -7,749 4,491 Financing activities New borrowings ² 184,957 133,376 Repayments of borrowings ² -167,668 -105,997 Dividend to owners of AB Volvo -28,468 -26,435 Dividend to non-controlling interest -235 -19 Other -54 -20 Change in cash and cash equivalents excl. translation differences -19,217 5,396 Translation difference on cash and cash equivalents 480 4,385 Change in cash and cash equivalents -18,738 9,781 Cash and cash equivalents, beginning of period 83,886 62,126 Cash and cash equivalents, end of period 65,148 71,906 1 Volvo Trucks has discontinued the acquisition of a heavy-duty truck manufacturing operation in China and recovered a previous advance payment. 2 The comparative figures are restated due to a reclassification between new borrowings and repayments of borrowings. VOLVO GROUP — 20 — THE THIRD QUARTER 2023 ===== SIDA 21 ===== CONSOLIDATED NET FINANCIAL POSITION Net financial position excl. post-employment benefits and lease liabilities Industrial Operations Volvo Group SEK bn Sep 30 2023 Dec 31 2022 Sep 30 2023 Dec 31 2022 Non-current interest-bearing assets Non-current customer-financing receivables - - 120.4 105.1 Non-current interest-bearing receivables 2.8 7.2 1.9 1.8 Current interest-bearing assets Customer-financing receivables - - 112.3 88.9 Interest-bearing receivables 6.6 5.7 6.5 5.7 Internal funding 4.7 8.0 - - Marketable securities 0.1 0.1 0.1 0.1 Cash and cash equivalents 61.5 76.0 65.1 83.9 Total interest-bearing financial assets 75.6 97.0 306.3 285.4 Non-current interest-bearing liabilities Bond loans -96.8 -102.9 -96.8 -102.9 Other loans -21.3 -20.6 -32.4 -30.9 Internal funding 111.7 110.3 - - Current interest-bearing liabilities Bond loans -51.6 -37.8 -51.6 -37.8 Other loans -40.9 -22.9 -50.5 -32.8 Internal funding 88.5 50.8 - - Total interest-bearing financial liabilities excl. lease liabilities -10.4 -23.1 -231.2 -204.4 Net financial position excl. post-employment benefits and lease liabilities 65.2 73.9 75.1 81.0 Provisions for post-employment benefits and lease liabilities, net Industrial Operations Volvo Group SEK bn Sep 30 2023 Dec 31 2022 Sep 30 2023 Dec 31 2022 Non-current lease liabilities -5.5 -4.8 -5.5 -4.8 Current lease liabilities -2.0 -1.8 -2.0 -1.8 Provisions for post-employment benefits, net -6.1 -6.0 -6.1 -6.0 Provisions for post-employment benefits and lease liabilities, net -13.6 -12.6 -13.6 -12.6 Net financial position incl. post-employment benefits and lease liabilities Industrial Operations Volvo Group SEK bn Sep 30 2023 Dec 31 2022 Sep 30 2023 Dec 31 2022 Net financial position excl. post-employment benefits and lease liabilities 65.2 73.9 75.1 81.0 Provisions for post-employment benefits and lease liabilities, net -13.6 -12.6 -13.6 -12.6 Net financial position incl. post-employment benefits and lease liabilities 51.6 61.3 61.5 68.4 VOLVO GROUP — 21 — THE THIRD QUARTER 2023 ===== SIDA 22 ===== CHANGES IN NET FINANCIAL POSITION, INDUSTRIAL OPERATIONS Third quarter First nine months SEK bn 2023 2023 Net financial position excl. post-employment benefits and lease liabilities at the end of previous period 61.6 73.9 Operating cash flow 5.6 23.2 Investments and divestments of shares, net 0.3 -0.6 Acquired and divested operations, net -1.5 -1.0 Capital injections to/from Financial Services 0.6 -0.4 Currency effect -0.5 1.0 Dividend to owners of AB Volvo - -28.5 Dividend to non-controlling interest -0.2 -0.2 Other changes -0.7 -2.1 Net financial position excl. post-employment benefits and lease liabilities at the end of period 65.2 65.2 Provisions for post-employment benefits and lease liabilities at the end of previous period -13.8 -12.6 Pension payments, included in operating cash flow 0.3 0.7 Remeasurements of defined post-employment benefits 0.5 0.4 Service costs and other pension costs -0.3 -0.9 Investments, remeasurements and amortizations of lease contracts -0.4 -0.8 Currency effect 0.2 -0.4 Other changes - -0.2 Provisions for post-employment benefits and lease liabilities at the end of period -13.6 -13.6 Net financial position incl. post-employment benefits and lease liabilities at the end of period 51.6 51.6 CONSOLIDATED CHANGES IN TOTAL EQUITY SEK M Equity attributable to owners of AB Volvo Non-controlling interest Total equity Balance as of December 31, 2021 141,045 3,073 144,118 Income for the period 32,722 247 32,969 Other comprehensive income for the period 15,417 179 15,596 Total comprehensive income for the period 48,140 425 48,565 Dividend -26,435 -19 -26,454 Changes in non-controlling interests - 40 40 Other changes -33 - -33 Transactions with shareholders -26,468 20 -26,447 Balance as of December 31, 2022 162,717 3,519 166,236 Income for the period 37,772 74 37,846 Other comprehensive income for the period 2,010 -32 1,978 Total comprehensive income for the period 39,782 42 39,824 Dividend -28,468 -235 -28,704 Changes in non-controlling interests - -29 -29 Other changes -104 - -104 Transactions with shareholders -28,572 -264 -28,836 Balance as of September 30, 2023 173,927 3,296 177,223 VOLVO GROUP — 22 — THE THIRD QUARTER 2023 ===== SIDA 23 ===== QUARTERLY FIGURES Income Statements, Volvo Group First nine months First nine months SEK M unless otherwise stated 3/2023 2/2023 1/2023 4/2022 3/2022 2023 2022 Net sales 132,405 140,821 131,420 134,302 114,917 404,646 339,176 Cost of sales -96,026 -101,900 -96,112 -103,227 -87,594 -294,037 -258,515 Gross income 36,380 38,920 35,308 31,076 27,324 110,609 80,662 Research and development expenses -6,305 -6,819 -6,492 -6,893 -5,595 -19,616 -15,632 Selling expenses -8,202 -8,329 -7,894 -8,239 -7,046 -24,426 -20,805 Administrative expenses -1,686 -1,858 -1,663 -1,744 -1,383 -5,207 -4,136 Other operating income and expenses -1,180 -6,873 -1,980 -2,292 -896 -10,033 -5,082 Income/loss from investments in Joint Ventures and associated companies -665 -578 -171 -351 -536 -1,414 -982 Income/loss from other investments -22 -2 - -15 1 -23 147 Operating income 18,320 14,462 17,109 11,541 11,869 49,890 34,171 Interest income and similar credits 656 572 572 453 247 1,800 555 Interest expenses and similar charges -272 -262 -314 -338 -262 -848 -868 Other financial income and expenses -67 -362 -570 -1,237 -96 -999 800 Income after financial items 18,636 14,409 16,797 10,420 11,758 49,843 34,657 Income taxes -4,543 -3,591 -3,863 -3,730 -3,071 -11,997 -8,379 Income for the period * 14,093 10,819 12,934 6,690 8,687 37,846 26,279 * Attributable to: Owners of AB Volvo 14,092 10,770 12,910 6,620 8,627 37,772 26,102 Non-controlling interest 1 49 24 70 61 74 176 14,093 10,819 12,934 6,690 8,687 37,846 26,279 Key ratios, Volvo Group, % Gross margin 27.5 27.6 26.9 23.1 23.8 27.3 23.8 Research and development expenses as % of net sales 4.8 4.8 4.9 5.1 4.9 4.8 4.6 Selling expenses as % of net sales 6.2 5.9 6.0 6.1 6.1 6.0 6.1 Administrative expenses as % of net sales 1.3 1.3 1.3 1.3 1.2 1.3 1.2 Operating margin 13.8 10.3 13.0 8.6 10.3 12.3 10.1 Key ratios, Industrial Operations, % Gross margin 27.0 27.3 26.4 22.5 23.0 26.9 23.0 Research and development expenses as % of net sales 5.0 5.0 5.1 5.3 5.0 5.0 4.7 Selling expenses as % of net sales 5.8 5.5 5.6 5.7 5.7 5.6 5.7 Administrative expenses as % of net sales 1.3 1.4 1.3 1.3 1.2 1.3 1.3 Operating margin 13.7 10.0 12.8 8.2 9.9 12.1 10.4 EBITDA margin, Industrial Operations Operating income Industrial Operations 17,393 13,545 16,238 10,678 10,990 47,176 34,184 Product and software development, amortization 704 709 696 723 712 2,109 2,076 Other intangible assets, amortization 39 38 44 33 27 120 86 Tangible assets, depreciation 3,314 3,259 3,143 3,784 3,090 9,716 9,226 Total depreciation and amortization 4,057 4,006 3,883 4,541 3,828 11,945 11,387 Operating income before depreciation and amortization (EBITDA) 21,450 17,551 20,121 15,219 14,818 59,121 45,571 EBITDA margin, % 16.9 12.9 15.8 11.7 13.3 15.1 13.8 Net capitalization of research and development Capitalization 1,022 1,166 1,208 1,114 972 3,396 3,593 Amortization -665 -670 -657 -677 -673 -1,992 -1,959 Net capitalization and amortization 357 496 551 438 300 1,404 1,634 Return on operating capital in Industrial Operations, % ¹ 66.0 58.4 57.0 50.8 50.1 Return on capital employed in Industrial Operations, % ¹ 33.7 30.2 30.3 27.4 27.4 1 12 months rolling. VOLVO GROUP — 23 — THE THIRD QUARTER 2023 ===== SIDA 24 ===== QUARTERLY FIGURES Net sales First nine months First nine months SEK M 3/2023 2/2023 1/2023 4/2022 3/2022 2023 2022 Trucks 89,848 93,748 89,556 87,303 75,078 273,152 223,233 Construction Equipment 24,296 28,999 25,109 27,596 24,238 78,404 72,664 Buses 5,386 5,434 4,267 6,654 4,817 15,087 11,929 Volvo Penta 4,956 5,416 5,603 4,849 4,451 15,975 13,253 Group Functions & Other 3,954 3,629 3,779 4,985 3,793 11,361 11,392 Eliminations -1,219 -1,236 -1,195 -1,175 -950 -3,650 -2,980 Industrial Operations 127,220 135,991 127,117 130,212 111,427 390,329 329,491 Financial Services 6,249 5,851 5,370 5,124 4,430 17,470 12,231 Eliminations -1,064 -1,021 -1,067 -1,033 -940 -3,153 -2,546 Volvo Group net sales 132,405 140,821 131,420 134,301 114,917 404,646 339,176 Operating income First nine months First nine months SEK M 3/2023 2/2023 1/2023 4/2022 3/2022 2023 2022 Trucks 13,397 8,950 12,854 7,644 7,539 35,201 24,332 Construction Equipment 3,733 5,353 4,587 3,093 3,541 13,673 9,813 Buses 340 219 -1,261 228 99 -703 126 Volvo Penta 790 804 1,271 468 593 2,865 2,059 Group Functions & Other -878 -1,783 -1,225 -754 -778 -3,886 -2,158 Eliminations 11 3 12 -1 -4 26 13 Industrial Operations 17,393 13,545 16,238 10,678 10,990 47,176 34,184 Financial Services 927 916 871 863 879 2,714 -15 Eliminations - - - 1 1 - 2 Volvo Group operating income 18,320 14,462 17,109 11,541 11,869 49,890 34,171 Adjusted operating income ¹ First nine months First nine months SEK M 3/2023 2/2023 1/2023 4/2022 3/2022 2023 2022 Trucks 14,038 14,950 12,715 8,274 7,307 41,703 25,547 Construction Equipment 3,733 5,353 4,587 3,093 3,773 13,673 10,151 Buses 340 219 178 228 99 736 126 Volvo Penta 790 804 1,271 468 593 2,865 2,061 Group Functions & Other -860 -513 -1,225 -754 -778 -2,598 -2,157 Eliminations 11 3 12 -1 -4 26 13 Industrial Operations 18,051 20,815 17,538 11,308 10,990 56,405 35,741 Financial Services 1,062 916 871 863 879 2,850 2,553 Eliminations - - - 1 1 - 2 Volvo Group adjusted operating income 19,114 21,732 18,409 12,171 11,869 59,254 38,295 1 For more information on adjusted operating income, please see note 6. Operating margin First nine months First nine months % 3/2023 2/2023 1/2023 4/2022 3/2022 2023 2022 Trucks 14.9 9.5 14.4 8.8 10.0 12.9 10.9 Construction Equipment 15.4 18.5 18.3 11.2 14.6 17.4 13.5 Buses 6.3 4.0 -29.6 3.4 2.0 -4.7 1.1 Volvo Penta 15.9 14.8 22.7 9.7 13.3 17.9 15.5 Industrial Operations 13.7 10.0 12.8 8.2 9.9 12.1 10.4 Volvo Group operating margin 13.8 10.3 13.0 8.6 10.3 12.3 10.1 Adjusted operating margin First nine months First nine months % 3/2023 2/2023 1/2023 4/2022 3/2022 2023 2022 Trucks 15.6 15.9 14.2 9.5 9.7 15.3 11.4 Construction Equipment 15.4 18.5 18.3 11.2 15.6 17.4 14.0 Buses 6.3 4.0 4.2 3.4 2.0 4.9 1.1 Volvo Penta 15.9 14.8 22.7 9.7 13.3 17.9 15.6 Industrial Operations 14.2 15.3 13.8 8.7 9.9 14.5 10.8 Volvo Group adjusted operating margin 14.4 15.4 14.0 9.1 10.3 14.6 11.3 VOLVO GROUP — 24 — THE THIRD QUARTER 2023 ===== SIDA 25 ===== QUARTERLY FIGURES Share data First nine months First nine months 3/2023 2/2023 1/2023 4/2022 3/2022 2023 2022 Earnings per share, SEK ¹ 6.93 5.30 6.35 3.26 4.24 18.58 12.84 Earnings per share, SEK ¹, 12 months rolling 21.84 19.15 18.98 16.09 16.77 - - Diluted earnings per share, SEK 6.93 5.30 6.35 3.26 4.24 18.58 12.84 Number of outstanding shares in millions 2,033 2,033 2,033 2,033 2,033 2,033 2,033 Average number of shares before dilution in millions 2,033 2,033 2,033 2,033 2,033 2,033 2,033 Average number of shares after dilution in millions 2,033 2,033 2,033 2,033 2,033 2,033 2,033 Number of own shares in millions - - - - - - - Average number of own shares in millions - - - - - - - 1 Earnings per share are calculated as Income for the period (excl. Non-controlling interest) divided by the weighted average number of shares outstanding during the period. _________________________________________________________________ NOTE 1 | ACCOUNTING POLICIES The Volvo Group applies International Financial Reporting Standards (IFRS) as endorsed by the EU. The accounting policies and definitions are consistently applied with those described in the Volvo Group Annual Report 2022 (available at www.volvogroup.com). As from January 1, 2023, a new long-term incentive plan has been adopted by the Annual General Meeting. The plan is accounted for in accordance with IFRS 2 Share-based payments. There are no other new accounting policies applicable from 2023 that materially affects the Volvo Group. This interim report has been prepared in accordance with IAS 34 Interim Financial Reporting and the Swedish Annual Accounts Act. The Parent Company applies the Swedish Annual Accounts Act and RFR 2 Reporting for legal entities. _________________________________________________________________ NOTE 2 | RISKS AND KEY SOURCES OF ESTIMATION UNCERTAINTY Each of the Volvo Groupʼs Business Areas and Truck Divisions monitors and manages risks in its operations. In addition, the Volvo Group utilizes a centralized Enterprise Risk Management (ERM) reporting process, which is a systematic and structured framework for reporting and reviewing risk assessments and mitigations as well as for follow-up on identified risks. The ERM process classifies Volvo Group risks into five categories: Macro and market related risks – such as the cyclical nature of the commercial vehicles industry, intense competition, extensive government regulations, political instability and security; Operational risks – such as transformation and technology risk, new business models, risks related to industrial operations, reliance on suppliers and scarce materials, cost inflation and price increases, cybersecurity and IT infrastructure, strategic transactions such as mergers and acquisitions, partnerships and divestments as well as residual value commitments; Climate and people risks – such as pandemics, climate and risk related to people and culture as well as human rights; Compliance risks – such as non-compliance with data protection laws, protection and maintenance of intangible assets, legal proceedings and corruption and non-compliance with competition law; and Financial risks – such as insurance coverage, credit risk, pension commitments, interest level and currency fluctuations, liquidity risks, as well as impairment on goodwill and other intangible assets. For a more elaborate description of these risks, please refer to the Risk Management section on pages 68-73 in the Volvo Group Annual Report 2022. Risk updates Short-term risks, when applicable, are also described in the respective segment section of this report. Update on supply situation and inflationary pressure Our ability to deliver according to market demand depends significantly on obtaining a timely and adequate supply of materials, components and other vital services, as well as on our ability to properly utilize the capacity in the Groupʼs different production and services facilities. At present, our supply chain and industrial system are strained in many areas due to e.g. shortages of labor, materials and components, and transport services. Further strains on the supply chain may also evolve from other events, including financial distress of suppliers and consequences of the war in Ukraine. There might be supply chain disturbances and stoppages in production going forward. Such disturbances could lead to higher costs and interruptions in production and delivery of Group products and services, that could have a material negative impact on the Groupʼs financial performance. The Group might experience higher input costs from increased prices on e.g. purchased material, freight and energy as well as higher labor costs. If the Group is unable to compensate for the higher input costs through increased prices on products and services sold, this could have a negative impact on the Groupʼs financial performance. Accounts receivable Due to the prevailing business model in the construction equipment industry in China, with long payment terms to customers, a substantial part of the Volvo Groupʼs accounts receivable is related to customers in this market. The weakened Chinese construction equipment market is currently impacting customersʼ and dealersʼ profitability negatively. This might affect their ability to honor their obligations to the Group and may consequently have a material adverse effect on the Groupʼs financial result and position. VOLVO GROUP — 25 — THE THIRD QUARTER 2023 ===== SIDA 26 ===== Detected premature degradation of emissions control component As previously communicated, the Volvo Group has detected that an emissions control component used in certain markets and models, may degrade more quickly than expected, affecting the vehicles emission performance negatively. The Volvo Group made a provision of SEK 7 billion impacting the operating income in Q4 2018, relating to the estimated costs to address the issue. Negative cash flow effects started in 2019 and will continue in the coming years. The Volvo Group will continuously assess the size of the provision as the matter develops. Contingent liabilities and contingent assets The reported amounts for contingent liabilities reflect a part of Volvo Groupʼs risk exposure. Total contingent liabilities as of September 30, 2023 , amounted to SEK 17.7 billion, a decrease of SEK 0.5 billion compared to December 31, 2022. The gross exposure of SEK 17.7 billion is partly reduced by counter guarantees and collaterals. Legal proceedings Starting in January 2011, the Volvo Group, together with a number of other truck manufacturers, was investigated by the European Commission in relation to a possible violation of EU antitrust rules. In July 2016 the European Commission adopted a settlement decision against the Volvo Group and other truck manufacturers finding that they were involved in an antitrust infringement which, in the case of the Volvo Group, covered a 14-year period from 1997 to 2011. The Volvo Group paid a monetary fine of EUR 670 million. Following the adoption of the European Commissionʼs settlement decision, the Volvo Group has received and is defending itself against a significant number of private damages claims brought by customers and other third parties alleging that they suffered loss, directly or indirectly, by reason of the conduct covered in the decision. The claims relate primarily to Volvo Group trucks sold during the 14-year period of the infringement and, in some cases, to trucks sold in certain periods after the infringement ended. Some claims have also been made against the Volvo Group that relate to trucks sold by other manufacturers. The truck manufacturers subject to the 2016 settlement decision are, in most countries, jointly and severally liable for any losses arising from the infringement. In the region of 3,000 claims are being brought in over 20 countries (including EU Member States, the United Kingdom, Norway and Israel) by large numbers of claimants either acting individually or as part of a wider group or class of claimants. Further claims may be commenced. The litigation in many countries can be expected to run for several years. Several hundred thousand trucks sold by the Volvo Group are currently subject to claims against it or other truck manufacturers, with claimants alleging that the infringement resulted in an increase in the prices paid for Volvo Group trucks which directly or indirectly caused them loss. The Volvo Group maintains its firm view that no damage was caused to its customers or any third party by the conduct set out in the settlement decision, and in fact, the European Commission did not assess any potential effects of the infringement on the market. The Volvo Group considers that transaction prices our customers paid for their trucks were unaffected by the infringement and were the outcome of individual negotiations across all elements of their purchasing requirements, including not only the prices for new trucks but also (where relevant) associated products and services sold together with new trucks such as service contracts, financing, buy-back guarantees etc. Litigation developments so far have been mixed with some adverse outcomes, although uncertainty regarding ultimate exposure to the litigation remains high and it is inherent in complex litigation that outlooks and risks fluctuate over time. At this stage it is not possible to make a reliable estimate of the total liability that could arise from such proceedings given the complexity of the claims and the different (and in some cases relatively early) stages to which national proceedings have progressed. However, the litigation is substantial in scale and any adverse outcome or outcomes of some or all of the litigation, depending on the nature and extent of such outcomes, may have a material negative impact on the Volvo Groupʼs financial results, cash flows and financial position. In light of progress in litigations and current risks, the Volvo Group has in Q2 2023 recognized a cost of SEK 6 billion, besides legal fees to advisors, which relate to aspects of the litigation that are currently possible to estimate and where an outflow of resources is probable. This is Volvo Group's current assessment, which may change as the litigation progresses. Strike in the US On October 8, the United Auto Workers (UAW) union informed Mack Trucks that their members had voted against ratification of a new five-year collective bargaining agreement covering about 3,900 employees at facilities in Pennsylvania, Maryland and Florida, including the powertrain plant, which supports the production of both Mack Trucks and Volvo, and Mack Trucksʼ assembly plant. Beginning on October 9, the UAW strike at all the covered facilities. If the strike continues for an extended period of time, it may result in negative financial consequences for the Volvo Group. VOLVO GROUP — 26 — THE THIRD QUARTER 2023 ===== SIDA 27 ===== NOTE 3 | ACQUISITIONS AND DIVESTMENTS Acquisitions and divestments In Q3, the Volvo Group divested the Russian entities. The divestment resulted in a negative impact on the operating income of SEK 794 M and a total negative cash flow effect of SEK 2,499 M. The Volvo Group also divested its shares in the associated company WirelessCar Sweden AB. The Volvo Group has not made any other acquisitions or divestments of operations during Q3 that have had a material impact on the financial statements. Assets and liabilities held for sale Assets and liabilities held for sale amounted to net SEK 260 M (-) as of September 30, 2023 , mainly related to planned property divestments. _________________________________________________________________ NOTE 4 | CURRENCY AND FINANCIAL INSTRUMENTS Fair value of financial instruments Valuation principles and classifications of Volvo Group financial instruments, as described in Volvo Group Annual Report 2022 Note 30, have been consistently applied throughout the reporting period. Financial instruments in the Volvo Group reported at fair value through profit and loss consist mainly of interest and currency derivatives. Derivatives with positive fair values amounted to SEK 6.0 billion (6.3) and derivatives with negative fair values amounted to SEK 8.5 billion (9.0) as of September 30, 2023. The derivatives are accounted for on gross basis. Financial liabilities valued at amortized cost, reported as non-current and current bond loans and other loans, amounted to SEK 232.9 billion ( 205.0) in reported carrying value with a fair value of SEK 229.6 billion (201.3). In the Volvo Group consolidated financial position, financial liabilities include loan-related derivatives with negative fair values amounting to SEK 5.7 billion (5.9). Currency effect on operating income, Volvo Group Compared to third quarter 2022 SEK M Third quarter 2023 Third quarter 2022 Change Net flow in foreign currency 208 Realized and unrealized gains and losses on derivatives -11 -18 6 Unrealized gains and losses on receivables and liabilities in foreign currency 1 -288 289 Translation effect on operating income in foreign subsidiaries 662 Total currency effect on operating income, Volvo Group 1,165 Applicable currency rates Quarterly exchange rates Close rates Third quarter 2023 Third quarter 2022 Sep 30 Sep 30 2023 2022 BRL 2.21 2.01 2.15 2.06 CNY 1.49 1.54 1.48 1.57 EUR 11.76 10.62 11.49 10.92 GBP 13.69 12.41 13.27 12.41 KRW 0.0082 0.0079 0.0081 0.0078 USD 10.81 10.55 10.84 11.12 __________________________________________________________________________________________________ NOTE 5 | TRANSACTIONS WITH RELATED PARTIES Sales of goods, services and other income Purchases of goods, services and other expenses SEK M Third quarter 2023 Third quarter 2022 Third quarter 2023 Third quarter 2022 Associated companies 597 353 50 35 Joint ventures 885 1,092 348 336 Receivables Payables Sep 30 Dec 31 Sep 30 Dec 31 SEK M 2023 2022 2023 2022 Associated companies 207 113 78 63 Joint ventures 391 472 146 122 VOLVO GROUP — 27 — THE THIRD QUARTER 2023 ===== SIDA 28 ===== NOTE 6 | RECONCILIATION OF ADJUSTED OPERATING INCOME Adjusted operating income First nine months First nine months SEK M 3/2023 2/2023 1/2023 4/2022 3/2022 2023 2022 Trucks 14,038 14,950 12,715 8,274 7,307 41,703 25,547 Construction Equipment 3,733 5,353 4,587 3,093 3,773 13,673 10,151 Buses 340 219 178 228 99 736 126 Volvo Penta 790 804 1,271 468 593 2,865 2,061 Group Functions & Other -860 -513 -1,225 -754 -778 -2,598 -2,157 Eliminations 11 3 12 -1 -4 26 13 Industrial Operations 18,051 20,815 17,538 11,308 10,990 56,405 35,741 Financial Services 1,062 916 871 863 879 2,850 2,553 Eliminations - - - 1 1 - 2 Volvo Group adjusted operating income 19,114 21,732 18,409 12,171 11,869 59,254 38,295 Adjustments First nine months First nine months SEK M 3/2023 2/2023 1/2023 4/2022 3/2022 2023 2022 Adjustment items (segment) Financial impact related to Russia: Trucks -640 - - - 232 -640 -1,215 Construction Equipment - - - - -232 - -338 Volvo Penta - - - - - - -3 Group Functions & Other -18 - - - - -18 -1 Financial Services -136 - - - - -136 -2,568 Costs relating to claims arising from the European Commissionʼs 2016 antitrust settlement decision (Trucks) - -6,000 - -630 - -6,000 - Restructuring charges relating to the US bus production for Nova Bus (Group Functions & Other) - -1,270 - - - -1,270 - Restructuring charges relating to the European bus operation (Buses) - - -1,300 - - -1,300 - Previously announced provision for premature degradation of an emission control component: Trucks - - 139 - - 139 - Buses - - -139 - - -139 - Total adjustments Trucks -640 -6,000 139 -630 232 -6,501 -1,215 Construction Equipment - - - - -232 - -338 Buses - - -1,439 - - -1,439 - Volvo Penta - - - - - - -3 Group Functions & Other -18 -1,270 - - - -1,288 -1 Industrial Operations -658 -7,270 -1,300 -630 - -9,228 -1,557 Financial Services -136 - - - - -136 -2,568 Eliminations - - - - - - - Volvo Group adjustments -794 -7,270 -1,300 -630 - -9,364 -4,125 Operating income First nine months First nine months SEK M 3/2023 2/2023 1/2023 4/2022 3/2022 2023 2022 Trucks 13,397 8,950 12,854 7,644 7,539 35,201 24,332 Construction Equipment 3,733 5,353 4,587 3,093 3,541 13,673 9,813 Buses 340 219 -1,261 228 99 -703 126 Volvo Penta 790 804 1,271 468 593 2,865 2,059 Group Functions & Other -878 -1,783 -1,225 -754 -778 -3,886 -2,158 Eliminations 11 3 12 -1 -4 26 13 Industrial Operations 17,393 13,545 16,238 10,678 10,990 47,176 34,184 Financial Services 927 916 871 863 879 2,714 -15 Eliminations - - - 1 1 - 2 Volvo Group operating income 18,320 14,462 17,109 11,541 11,869 49,890 34,171 For reconciliation of other key ratios, see www.volvogroup.com VOLVO GROUP — 28 — THE THIRD QUARTER 2023 ===== SIDA 29 ===== PARENT COMPANY Income from investments in group companies for the third quarter includes dividends amounting to SEK 167 M (1,221) and a loss on the divestment of the Russian entity amounting to SEK 173 M. Financial net debt amounted to SEK 30,748 M (22,213) at the end of the third quarter . Income statement Third quarter First nine months SEK M 2023 2022 2023 2022 Net sales¹ 71 52 225 183 Cost of sales¹ -71 -52 -225 -183 Gross income - - - - Operating expenses¹ -503 -334 -1,338 -940 Operating income (loss) -503 -334 -1,338 -940 Income from investments in group companies -6 1,221 3,983 5,099 Income from investments in joint ventures and associated companies - - 76 34 Income from investments, other shares and participations - - - - Interest income and expenses -354 -112 -821 -276 Other financial income and expenses 9 5 -120 204 Income after financial items -854 780 1,780 4,121 Appropriations - - - - Income taxes 162 46 2,785 143 Income for the period -692 826 4,565 4,264 1 Of net sales in the third quarter, SEK 67 M (48) pertained to group companies, while purchases from group companies amounted to SEK 131 M (91). Other comprehensive income Income for the period -692 826 4,565 4,264 Other comprehensive income, net of income taxes - - - - Total comprehensive income for the period -692 826 4,565 4,264 VOLVO GROUP — 29 — THE THIRD QUARTER 2023 ===== SIDA 30 ===== Balance sheet SEK M Sep 30 2023 Dec 31 2022 Assets Non-current assets Tangible assets 7 7 Financial assets Shares and participations in group companies 69,520 70,987 Investments in joint ventures and associated companies 8,946 8,946 Other shares and participations 2 2 Other non-current receivables 603 593 Deferred tax assets 641 217 Total non-current assets 79,719 80,752 Current assets Current receivables from group companies 1,025 29,316 Tax assets 4,106 - Other current receivables 317 251 Total current assets 5,448 29,567 Total assets 85,167 110,319 Equity and liabilities Equity Restricted equity 9,899 9,899 Unrestricted equity 35,601 59,504 Total Equity 45,500 69,403 Untaxed reserves 7,500 7,500 Provisions 257 259 Non-current liabilities¹ 645 405 Current liabilities² 31,265 32,752 Total equity and liabilities 85,167 110,319 1 Of which SEK 640 M (400) pertains to group companies. 2 Of which SEK 30,572 M (28,819) pertains to group companies. Events after the balance sheet date For important events, please see page 6. No other significant events have occurred after the end of the third quarter 2023 that are expected to have a material effect on the Volvo Group. Gothenburg, October 18, 2023 AB Volvo (publ) Martin Lundstedt President and CEO This report has not been reviewed by AB Volvoʼs auditors. VOLVO GROUP — 30 — THE THIRD QUARTER 2023 ===== SIDA 31 ===== NET ORDER INTAKE Net order intake of trucks Third quarter Change % First nine months Change %Number of trucks 2023 2022 2023 2022 Net order intake Europe 21,154 32,329 -35 77,284 83,908 -8 Heavy- and medium-duty 17,592 26,090 -33 62,123 68,056 -9 Light-duty 3,562 6,239 -43 15,161 15,852 -4 North America 17,355 18,641 -7 41,222 34,389 20 South America 4,284 5,837 -27 15,798 22,527 -30 Asia 2,796 4,889 -43 13,368 14,538 -8 Africa and Oceania 1,613 2,993 -46 7,878 8,309 -5 Total order intake 47,202 64,689 -27 155,550 163,671 -5 Heavy-duty (>16 tons) 38,687 52,891 -27 126,985 135,745 -6 Medium-duty (7-16 tons) 4,937 5,513 -10 13,265 11,839 12 Light-duty (<7 tons) 3,578 6,285 -43 15,300 16,087 -5 Total order intake 47,202 64,689 -27 155,550 163,671 -5 Net order intake of trucks by brand Volvo Europe 11,293 19,097 -41 41,522 42,655 -3 North America 5,580 7,614 -27 16,992 17,557 -3 South America 4,157 5,676 -27 15,309 21,762 -30 Asia 2,389 3,976 -40 10,899 11,040 -1 Africa and Oceania 1,100 1,946 -43 5,350 5,786 -8 Total Volvo 24,519 38,309 -36 90,072 98,800 -9 Heavy-duty (>16 tons) 23,846 36,956 -35 87,363 95,277 -8 Medium-duty (7-16 tons) 673 1,353 -50 2,709 3,523 -23 Total Volvo 24,519 38,309 -36 90,072 98,800 -9 Renault Trucks Europe 9,861 13,232 -25 35,762 41,253 -13 Heavy- and medium-duty 6,299 6,993 -10 20,601 25,401 -19 Light-duty 3,562 6,239 -43 15,161 15,852 -4 North America 15 41 -63 78 138 -43 South America 35 87 -60 187 379 -51 Asia 407 913 -55 2,469 3,498 -29 Africa and Oceania 344 335 3 1,233 1,057 17 Total Renault Trucks 10,662 14,608 -27 39,729 46,325 -14 Heavy-duty (>16 tons) 6,035 6,162 -2 20,178 24,670 -18 Medium-duty (7-16 tons) 1,049 2,161 -51 4,251 5,568 -24 Light-duty (<7 tons) 3,578 6,285 -43 15,300 16,087 -5 Total Renault Trucks 10,662 14,608 -27 39,729 46,325 -14 Mack North America 11,760 10,986 7 24,152 16,694 45 South America 92 74 24 290 310 -6 Africa and Oceania 98 356 -72 545 536 2 Total Mack 11,950 11,416 5 24,987 17,540 42 Heavy-duty (>16 tons) 8,752 9,471 -8 18,795 15,014 25 Medium-duty (7-16 tons) 3,198 1,945 64 6,192 2,526 145 Total Mack 11,950 11,416 5 24,987 17,540 42 VOLVO GROUP — 31 — THE THIRD QUARTER 2023 ===== SIDA 32 ===== DELIVERIES Deliveries of trucks Third quarter Change % First nine months Change %Number of trucks 2023 2022 2023 2022 Deliveries Europe 26,546 23,857 11 92,565 82,755 12 Heavy- and medium-duty 20,236 19,258 5 71,800 68,478 5 Light-duty 6,310 4,599 37 20,765 14,277 45 North America 15,041 13,312 13 47,012 42,293 11 South America 5,635 8,611 -35 15,495 23,236 -33 Asia 4,842 4,532 7 16,486 12,947 27 Africa and Oceania 3,210 2,991 7 9,089 8,493 7 Total deliveries 55,274 53,303 4 180,647 169,724 6 Heavy-duty (>16 tons) 44,795 45,174 -1 145,834 144,129 1 Medium-duty (7-16 tons) 4,086 3,509 16 13,760 11,174 23 Light-duty (<7 tons) 6,393 4,620 38 21,053 14,421 46 Total deliveries 55,274 53,303 4 180,647 169,724 6 Deliveries of trucks by brand Volvo Europe 14,024 12,845 9 47,404 44,934 5 North America 7,640 7,282 5 24,283 23,148 5 South America 5,494 8,308 -34 14,954 22,331 -33 Asia 3,803 3,505 9 12,895 10,131 27 Africa and Oceania 2,226 2,010 11 5,895 5,523 7 Total Volvo 33,187 33,950 -2 105,431 106,067 -1 Heavy-duty (>16 tons) 32,147 33,131 -3 102,042 103,492 -1 Medium-duty (7-16 tons) 1,040 819 27 3,389 2,575 32 Total Volvo 33,187 33,950 -2 105,431 106,067 -1 Renault Trucks Europe 12,522 11,012 14 45,161 37,821 19 Heavy- and medium-duty 6,212 6,413 -3 24,396 23,544 4 Light-duty 6,310 4,599 37 20,765 14,277 45 North America 63 15 320 181 62 192 South America 44 131 -66 271 467 -42 Asia 1,039 1,027 1 3,591 2,816 28 Africa and Oceania 376 401 -6 1,500 1,190 26 Total Renault Trucks 14,044 12,586 12 50,704 42,356 20 Heavy-duty (>16 tons) 6,393 6,581 -3 24,574 23,415 5 Medium-duty (7-16 tons) 1,258 1,385 -9 5,077 4,520 12 Light-duty (<7 tons) 6,393 4,620 38 21,053 14,421 46 Total Renault Trucks 14,044 12,586 12 50,704 42,356 20 Mack North America 7,338 6,015 22 22,548 19,083 18 South America 84 127 -34 233 360 -35 Africa and Oceania 327 233 40 886 602 47 Total Mack 7,749 6,375 22 23,667 20,045 18 Heavy-duty (>16 tons) 6,012 5,168 16 18,522 16,281 14 Medium-duty (7-16 tons) 1,737 1,207 44 5,145 3,764 37 Total Mack 7,749 6,375 22 23,667 20,045 18 VOLVO GROUP — 32 — THE THIRD QUARTER 2023 ===== SIDA 33 ===== This is information that AB Volvo (publ) is obliged to make public pursuant to the EU Market Abuse Regulation and the Securities Market Act. The information was submitted for publication, through the agency of the contact person set out in the press release concerning this report, at 07.20 CEST on October 18, 2023. This report contains forward-looking statements that reflect the Board of Directors' and management's current views with respect to certain future events and potential financial performance. Forward-looking statements are subject to risks and uncertainties. Results could differ materially from forward-looking statements as a result of, among other factors, (i) changes in economic, market and competitive conditions, (ii) success of business initiatives, (iii) changes in the regulatory environment and other government actions, (iv) fluctuations in exchange rates and (v) business risk management. This report is based solely on the circumstances at the date of publication and except to the extent required under applicable law, AB Volvo is under no obligation to update the information, opinions or forward-looking statements in this report. VOLVO GROUP — 33 — THE THIRD QUARTER 2023 ===== SIDA 34 ===== Financial calendar Report on the fourth quarter and full year 2023 January 26, 2024 Annual and Sustainability Report 2023 February 29, 2024 Annual General Meeting 2024 March 27, 2024 Report on the first quarter 2024 April 17, 2024 Report on the second quarter 2024 July 18, 2024 Report on the third quarter 2024 October 18, 2024 Contacts Media relations: Claes Eliasson +46 765 53 72 29 Investor Relations: Johan Bartler +46 739 02 21 93 Anders Christensson +46 765 53 59 66 Aktiebolaget Volvo (publ) 556012–5790 Investor Relations, VGHQ SE-405 08 Göteborg, Sweden Tel +46 31 66 00 00 www.volvogroup.com VOLVO GROUP — 34 — THE THIRD QUARTER 2023