The company's flagship Mercedes brand saw sales fall in the key Chinese market as it reorganized its sales operation there. High spending of 1.6 billion euros on new plants and equipment also hurt earnings for the quarter.
The company said that earnings before interest and tax for this year would come in below last year's figure of 8.1 billion euros, due to lowered market expectations and the weak first quarter performance. The company had previously said this year's earnings would match last year's.
The profit prediction was also reduced because Daimler has sold its 15 percent stake in aerospace firm EADS, parent company of plane maker Airbus. Daimler's future earnings will therefore no longer include a share of EADS profits or losses. Daimler had 22.5 percent of EADS voting rights, and so had been reporting that proportion of EADS income.