Attendees inspect a Mercedes-Benz EQV electric van in the Daimler AG exhibition hall on the opening day of the IAA Frankfurt Motor Show in Frankfurt, Germany, on Tuesday, Sept. 10, 2019. (Photo: VCG)

German carmaker Daimler reported Thursday a return to quarterly profits in July-September after its first three-month loss in ten years, but said more work was ahead as it confronts a slowing global market.

Net profits at the Mercedes-Benz parent company grew three percent year-on-year, to 1.8 billion euros ($2.0 billion).

At 43.3 billion euros, revenues grew eight percent thanks to "strong sales", chief executive Ola Kallenius said.

But he added that "in order to master the transformation in the next few years, we need to increase our efforts considerably".

The profit margin at the flagship Mercedes-Benz cars division -- watched closely by markets as an indicator of the firm's health -- slid 0.3 percentage points, to 6.0 percent.

Over the full year, Daimler confirmed that it expects revenue "slightly above" 2018's level, while operating profit will be "signficantly below" last year's 11.1 billion euros.

The group has suffered blows this year from new allegations of diesel emissions cheating, a recall over faulty Takata airbags and slowing growth in the global car market.

Trade conflicts have weighed heavily on the auto sector, as has continued uncertainty over British-European business after Brexit.

Massive diesel recalls of cars allegedly fitted with software to cheat emissions tests prompted a 1.2-billion-euro net loss for Daimler in the second quarter, as it booked 4.2 billion in one-off costs.

So far German motor vehicle authority KBA has ordered almost one million Daimler vehicles recalled, but the carmaker says none of the "motor control functions" highlighted by officials are illegal.

The Stuttgart-based firm nevertheless agreed to pay an 870-million-euro fine in September for having sold vehicles that did not conform with legal emissions limits.