Financial Performance - Autoliv's Q2 2024 consolidated sales were $2605 million, a decrease of 1% compared to Q2 2023's $2635 million[16] - Adjusted operating income increased to $221 million with an 8.5% margin, compared to $212 million with an 8% margin in Q2 2023[16] - Operating cash flow decreased from $379 million in Q2 2023 to $340 million in Q2 2024[16] - The company repurchased shares worth $160 million and paid a dividend of $0.68 per share[6] - Autoliv expects an operating cash flow of around $1.1 billion for the full year 2024[66] Market Dynamics - Global Light Vehicle Production (LVP) is expected to decline by approximately 3% in 2024[65] - Autoliv's organic sales growth outperformed global LVP by more than 1 percentage point[21] - In Q2 2024, LVP in China accounted for 18%, Americas 34%, Japan 8%, Europe 29%, and Rest of Asia 11% of total sales[19] Cost Reduction and Efficiency - The company reduced indirect headcount by around 1,100, representing more than 5%[6] - Autoliv is progressing with structural cost reduction activities[6] Sustainability - Autoliv successfully phased out the greenhouse gas Sulfur hexafluoride (SF6) in steering wheel production[31] - The company is increasing its use of renewable electricity, supporting its ambition of climate neutrality in its own operations by 2030[31]

Financial Data and Key Metrics - Net sales decreased by 1% YoY to $2.6 billion, driven by unfavorable currency translation effects, lower light vehicle production, and a negative regional and customer mix [11][12] - Adjusted operating income increased by 4% YoY to $221 million, with the adjusted operating margin improving by 50 basis points to 8.5% [11][21] - Operating cash flow was $340 million, $39 million lower than Q2 2023, which was unusually strong due to working capital reversals [11][24] - Gross margin improved by 130 basis points YoY and sequentially, supported by higher direct labor efficiency and cost reductions [10][21] - Leverage ratio improved to 1.2x, despite $250 million in shareholder returns during the quarter [7][26] Business Line Performance - Sales to domestic Chinese OEMs increased by 39% YoY and accounted for 38% of total sales in China, up from 20% in early 2022 [15] - Safety Content per Vehicle (CPV) is on track to grow by around 10% from 2022 to 2024 for both global and domestic Chinese OEMs [16] - The company signed a strategic cooperation agreement with XPENG AEROHT, a Chinese flying car innovator, to pioneer safety solutions for future mobility [7] Market Performance - Global light vehicle production was 3 percentage points lower than expected, with significant reductions in Europe, Japan, and China [8][13] - Sales in China underperformed by 7 percentage points due to declining production from key global customers and strong growth in low Autoliv content models [14][16] - The company outperformed global light vehicle production by 140 basis points, driven by strong performance in Japan, Rest of Asia, and Europe [14] Strategy and Industry Competition - The company is focused on reducing its indirect workforce by up to 2,000 employees, targeting $50 million in savings for 2024 [5] - Autoliv is strengthening its position with fast-growing domestic Chinese OEMs, which now account for 55% of China's light vehicle production, up from 40% in early 2022 [15] - The company expects a record number of product launches in 2024, with six models produced in China, reflecting its strong position in the region [17] Management Commentary on Operating Environment and Outlook - Management expects sequential margin improvement in H2 2024, targeting an adjusted operating margin of 11% to 12%, supported by stable light vehicle production, cost control, and customer compensations [32][69] - Full-year 2024 guidance was adjusted to reflect a 3% decline in global light vehicle production, with organic sales growth expected at around 2% [32] - The company remains committed to its around 12% adjusted operating margin target and high shareholder returns, supported by strong cash flow and balance sheet efficiency [7][32] Other Key Information - The company phased out sulfur hexafluoride (SF6) in steering wheel production, reducing Scope 1 and 2 emissions by 6% [19] - Autoliv developed airbag cushions made from 100% recycled polyester, contributing to its net-zero greenhouse gas emissions target by 2040 [20] - The company entered into a $125 million revolving credit facility with Standard Chartered Bank, maturing in 2029 [27] Q&A Session Summary Question: Why is the decremental margin at the higher end of the range? - The decremental margin is at the higher end due to lower light vehicle production and a slight headwind from raw materials [36][37] Question: How much of the mix headwind is expected in H2 2024? - The mix headwind is expected to be around negative 1% for the full year, with improvements in China offsetting some of the negative trends [39][40] Question: What is the view on light vehicle production and price compensation? - The company is more cautious on Europe due to economic headwinds, while price compensation negotiations remain detailed and evidence-driven [44][45] Question: Is the out-of-period compensation a timing issue? - The out-of-period compensation is a timing issue, with $6 million negotiated in Q2 2024 retroactively applied to Q1 2024 [48][49] Question: What drives the expected margin improvement in H2 2024? - Margin improvement is driven by higher light vehicle production, cost control, customer compensations, and structural initiatives, offset by raw material headwinds [69][70] Question: What are the cost reduction opportunities? - The company targets $50 million in indirect cost savings for 2024, ramping up to $130 million when fully implemented, with $40 million in year-over-year savings [75] Question: How should we think about market outgrowth? - The company focuses on organic growth of 4% to 6%, driven by light vehicle production growth, content growth, and additional business opportunities [78]

Core Insights - Autoliv reported a decline in second-quarter sales due to a slump in car demand, leading to a reduction in its guidance for the year [1] - The company missed both quarterly profit and revenue estimates, with adjusted earnings per share (EPS) at $1.87 and revenue down 1.1% year-over-year to $2.61 billion [1] - Autoliv has revised its full-year organic sales growth outlook down to approximately 2% from the previous estimate of about 5% and adjusted its operating margin forecast to around 9.5% to 10% from about 10.5% [3] Company Performance - CEO Mikael Bratt indicated that light vehicle production with key customers was lower than expected, particularly in June, due to weaker sales and inventory adjustments [2] - The company anticipates a 5.5% decline in worldwide light vehicle production for the third quarter and a 2.2% decrease for the entire year of 2024 [3] - Following the announcement, Autoliv's shares fell approximately 8% to $99.82, marking the lowest level in eight months [3]

Group 1: Profitability and Sales Performance - Profitability improved in Q2 despite a slight decline in net sales, driven by better pricing and cost reductions, with indirect headcount reduced by 1,100 [1] - The company outperformed LVP significantly in Asia excluding China and in Europe, supported by product launches and better pricing, while slightly underperforming in the Americas due to reduced production from key customers [1] Group 2: Market Dynamics in China - The company expanded its business with domestic Chinese OEMs, which accounted for 38% of China sales in Q2, with a 39% year-over-year sales growth and a 25% increase compared to the previous quarter [2] - Despite the growth with domestic OEMs, the overall market in China developed unfavorably, leading to a 7 percentage point underperformance due to significant production declines from key global customers [2] Group 3: Financial Guidance and Outlook - The company remains focused on achieving an adjusted operating margin target of around 12%, while slightly adjusting the full year 2024 guidance due to changes in LVP and customer mix [3] - A significant increase in profitability is expected in the second half of the year, with an adjusted operating margin projected at around 11-12% compared to 8.0% in the first half [3] - Positive developments in cash flow and balance sheet support the company's commitment to high shareholder returns [3]

Group 1: Profitability and Sales Performance - Profitability improved in Q2 despite a slight decline in net sales, driven by better pricing and cost reductions, with a reduction of 1,100 indirect headcount since the start of the program [1] - The company outperformed LVP significantly in Asia excluding China and in Europe, supported by product launches and better pricing, while slightly underperforming in the Americas due to reduced production from key customers [1] Group 2: Market Dynamics in China - The company is expanding its business with domestic Chinese OEMs, which accounted for 38% of China sales in Q2, with a 39% year-over-year sales growth and a 25% increase compared to the previous quarter [2] - Despite growth in sales to domestic OEMs, the overall market developed unfavorably in Q2, leading to a 7 percentage point underperformance in China due to significant production declines from key global customers [2] Group 3: Financial Guidance and Outlook - The company remains focused on achieving an adjusted operating margin target of around 12%, while slightly adjusting the full year 2024 guidance due to changes in LVP and adverse customer mix [3] - A significant increase in profitability is expected in the second half of the year, with an adjusted operating margin projected at around 11-12% compared to 8.0% in the first half [3] - Positive developments in cash flow and balance sheet support the company's commitment to high levels of shareholder returns [3]

Core Insights - Autoliv, Inc. reported revenue of $2.61 billion for the quarter ended June 2024, reflecting a year-over-year decline of 1.1% [1] - The earnings per share (EPS) for the quarter was $1.87, down from $1.93 in the same quarter last year [1] - The reported revenue fell short of the Zacks Consensus Estimate of $2.77 billion by 6.09%, and the EPS was 23.36% below the consensus estimate of $2.44 [1] Sales Performance - Sales of Airbags, Steering Wheels, and Other products showed an organic change of 1.2%, compared to an estimated 6.2% by analysts [2] - Sales of Seatbelt Products experienced an organic change of -0.3%, against an estimated 4.2% by analysts [2] - Overall sales by segment had an organic change of 0.7%, while the estimate was 6.6% [2] - Actual sales for Seatbelt Products were $858 million, lower than the estimated $908.63 million, representing a -2.3% change year-over-year [2] - Sales for Airbags, Steering Wheels, and Other products were reported at $1.75 billion, compared to the average estimate of $1.87 billion, indicating a -0.6% change year-over-year [2] Stock Performance - Autoliv's shares have returned +1.8% over the past month, outperforming the Zacks S&P 500 composite's +1.1% change [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

PART I - FINANCIAL INFORMATION [Financial Statements](index=4&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) Presents unaudited condensed consolidated financial statements for Q2 and H1 2024, covering income, balance sheets, cash flows, and detailed notes [Consolidated Statements of Income](index=4&type=section&id=Consolidated%20Statements%20of%20Income) Consolidated Statements of Income (Unaudited) | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :--- | :--- | :--- | :--- | :--- | | **Net sales** | **$2,605M** | **$2,635M** | **$5,220M** | **$5,127M** | | Gross profit | $475M | $447M | $917M | $826M | | Operating income | $206M | $94M | $400M | $221M | | **Net income attributable to controlling interest** | **$138M** | **$53M** | **$265M** | **$127M** | | **Net earnings per share – diluted** | **$1.71** | **$0.61** | **$3.23** | **$1.47** | [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Condensed Consolidated Balance Sheet Highlights (Unaudited) | Metric | June 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | **Total current assets** | **$3,703M** | **$3,974M** | | Cash and cash equivalents | $408M | $498M | | **Total assets** | **$8,010M** | **$8,332M** | | **Total current liabilities** | **$3,785M** | **$4,035M** | | Long-term debt | $1,540M | $1,324M | | **Total equity** | **$2,311M** | **$2,570M** | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Condensed Consolidated Statements of Cash Flows (Unaudited) | Metric | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | **$462M** | **$334M** | | Net cash used in investing activities | ($286M) | ($267M) | | Net cash used in financing activities | ($269M) | ($168M) | | **Net decrease in cash and cash equivalents** | **($90M)** | **($119M)** | [Notes to the Financial Statements](index=9&type=section&id=Notes%20to%20the%20Financial%20Statements) - In February 2024, the Company issued 5.5-year notes for **€500 million** with a **3.625% coupon**, maturing in August 2029. In April 2024, the Company repaid **$297 million** of US Private Placement debt[32](index=32&type=chunk) - The effective tax rate for the six months ended June 30, 2024 was **25.5%**, down from **33.4%** for the same period in 2023[35](index=35&type=chunk) - The restructuring reserve balance was **$189 million** as of June 30, 2024, primarily related to the global structural cost reduction program initiated in Europe in 2023[39](index=39&type=chunk) - The Company is involved in a multi-district litigation regarding ARC airbag inflators and is also monitoring a NHTSA initial decision to recall approximately **52 million** ARC and Delphi inflators. A loss is considered reasonably possible for both matters, but no accrual has been made as an estimate of potential loss cannot be determined[55](index=55&type=chunk)[56](index=56&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=21&type=section&id=ITEM%202.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Management discusses Q2 and H1 2024 financial results, noting improved profitability from cost reductions and better pricing, and provides full-year 2024 guidance [Executive Overview](index=22&type=section&id=Executive%20Overview) Q2 2024 Financial Highlights | Metric | Value | Change vs. Q2 2023 | | :--- | :--- | :--- | | Net Sales | $2,605M | -1.1% | | Organic Sales Growth | 0.7% | N/A | | Operating Margin | 7.9% | +4.3pp | | Adjusted Operating Margin | 8.5% | +0.5pp | | EPS | $1.71 | +178% | | Adjusted EPS | $1.87 | -3% | - Profitability improvement was driven by better pricing and successful cost reductions, including a reduction of **1,100 indirect headcount** since the program's start. The leverage ratio improved to **1.2x**[72](index=72&type=chunk) - The company underperformed in China due to an unfavorable market mix, where models with low Autoliv content grew strongly while key global customers' production declined. However, sales to domestic Chinese OEMs grew by **39% YoY**[72](index=72&type=chunk) [Results of Operations](index=24&type=section&id=Results%20of%20Operations) Q2 2024 vs. Q2 2023 Sales Development | Region | Organic Sales Growth | LVP Growth | Out/Under Performance | | :--- | :--- | :--- | :--- | | Americas | (2.8)% | (0.5)% | (2.3)pp | | Europe | 1.6% | (6.1)% | +7.7pp | | China | (2.8)% | 4.5% | (7.3)pp | | Asia excl. China | 10.0% | (2.6)% | +12.6pp | | **Global** | **0.7%** | **(0.7)%** | **+1.4pp** | H1 2024 vs. H1 2023 Sales Development | Region | Organic Sales Growth | LVP Growth | Out/Under Performance | | :--- | :--- | :--- | :--- | | Americas | 0.7% | (0.3)% | +1.0pp | | Europe | 2.6% | (3.4)% | +6.0pp | | China | 1.6% | 5.6% | (4.0)pp | | Asia excl. China | 9.1% | (4.6)% | +13.7pp | | **Global** | **3.0%** | **(0.3)%** | **+3.3pp** | - In Q2 2024, operating income increased to **$206 million** from **$94 million** in Q2 2023, primarily due to lower capacity alignment accruals (**$14 million** in Q2'24 vs **$109 million** in Q2'23) and a **$28 million** increase in gross profit[88](index=88&type=chunk)[89](index=89&type=chunk) [Liquidity and Capital Resources](index=29&type=section&id=Liquidity%20and%20Capital%20Resources) Cash Flow Summary (Six Months Ended June 30) | Metric | 2024 | 2023 | | :--- | :--- | :--- | | Operating Cash Flow | $462M | $334M | | Capital Expenditure, net | ($286M) | ($267M) | | **Free Cash Flow** | **$176M** | **$66M** | - As of June 30, 2024, the company's liquidity position was approximately **$1.5 billion**, including a cash balance of **$0.4 billion** and committed, unused loan facilities[100](index=100&type=chunk) - The leverage ratio (Net Debt + Pension Liabilities / Adjusted EBITDA) improved to **1.2x** as of June 30, 2024, compared to **1.3x** a year earlier[100](index=100&type=chunk)[112](index=112&type=chunk) [Full Year 2024 Guidance](index=33&type=section&id=Full%20year%202024%20guidance) Full Year 2024 Financial Indication | Financial Measure | Indication | | :--- | :--- | | Organic sales growth | Around 2% | | Foreign currency impact on net sales | Around 1% negative | | Adjusted operating margin | Around 9.5-10.0% | | Tax rate | Around 28% | | Operating cash flow | Around $1.1 billion | | Capital expenditures, net (% of sales) | Around 5.5% | [Quantitative and Qualitative Disclosures About Market Risk](index=35&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company reports no material changes to market risk disclosures since its 2023 Annual Report on Form 10-K - No material changes to market risk disclosures have occurred since the 2023 Form 10-K filing[123](index=123&type=chunk) [Controls and Procedures](index=35&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) Management concluded that disclosure controls and procedures were effective, with no material changes to internal control over financial reporting during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures are effective as of June 30, 2024[124](index=124&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that have materially affected, or are reasonably likely to materially affect, these controls[124](index=124&type=chunk) PART II - OTHER INFORMATION [Legal Proceedings](index=36&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) This section refers to Note 9 of the financial statements for a summary of ongoing legal proceedings arising in the ordinary course of business - Information regarding legal proceedings is incorporated by reference from Part I, Item 1, Note 9 'Contingent Liabilities'[126](index=126&type=chunk) [Risk Factors](index=36&type=section&id=ITEM%201A.%20RISK%20FACTORS) The company reports no material changes to the risk factors previously disclosed in its 2023 Annual Report on Form 10-K - No material changes to risk factors have occurred since the 2023 Form 10-K filing[127](index=127&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=36&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) This section details common stock repurchases during Q2 2024 as part of the publicly announced stock repurchase program Stock Repurchases (Q2 2024) | Period | Total Shares Purchased | Average Price Paid per Share (USD) | | :--- | :--- | :--- | | April 1-30, 2024 | — | — | | May 1-31, 2024 | 779,394 | $124.67 | | June 1-30, 2024 | 530,212 | $118.56 | - The stock repurchase program, announced in November 2021, authorizes repurchases up to **$1.5 billion** or **17 million shares**, whichever comes first, through the end of 2024[129](index=129&type=chunk) [Other Information](index=36&type=section&id=ITEM%205.%20OTHER%20INFORMATION) The company reports no director or officer adopted or terminated a Rule 10b5-1 trading arrangement during Q2 2024 - During the three months ended June 30, 2024, no director or officer adopted or terminated a Rule 10b5-1 trading arrangement[131](index=131&type=chunk) [Exhibits](index=37&type=section&id=ITEM%206.%20EXHIBITS) This section lists exhibits filed with the Form 10-Q, including CEO and CFO certifications and XBRL data files, referencing previously filed documents - The report includes certifications from the CEO and CFO as required by the Securities Exchange Act of 1934 and the Sarbanes-Oxley Act of 2002[132](index=132&type=chunk)

Autoliv, Inc. (ALV) came out with quarterly earnings of $1.87 per share, missing the Zacks Consensus Estimate of $2.44 per share. This compares to earnings of $1.93 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -23.36%. A quarter ago, it was expected that this company would post earnings of $1.40 per share when it actually produced earnings of $1.58, delivering a surprise of 12.86%.Over the last four quarters, the company ha ...

Exhibit 99.1 Financial Report April - June 2024 Stockholm, Sweden, July 19, 2024 (NYSE: ALV and SSE: ALIV.sdb) Autoliv Financial Report April - June 2024 Q2 2024: Sales headwinds from lower LVP Financial highlights Q2 2024 $2,605 million net sales 1.1% net sales decrease 0.7% organic sales growth* 7.9% operating margin 8.5% adjusted operating margin* $1.71 EPS, 178% increase $1.87 adjusted EPS*, 3% decrease Full year 2024 guidance Around 2% organic sales growth Around 1% negative FX effect on net sales Arou ...

Share Repurchase and Issued Shares - Autoliv retired 1,309,606 shares of common stock that had been repurchased during the quarter, resulting in a decrease in the issued shares [1] - The total number of issued shares of common stock is now 84,816,615, with 80,079,757 shares outstanding [1] - After the retirement of the repurchased shares, Autoliv holds 4,736,858 shares of common stock in treasury, which have no voting rights or rights to participate in distributions under Delaware law [1] Company Overview - Autoliv is the worldwide leader in automotive safety systems, developing, manufacturing, and marketing protective systems such as airbags, seatbelts, and steering wheels for major automotive manufacturers [2] - The company also provides mobility safety solutions, including pedestrian protection, connected safety services, and safety solutions for riders of powered two-wheelers [2] - In 2023, Autoliv's products saved 35,000 lives and reduced more than 450,000 injuries [2] Operational and Financial Highlights - Autoliv has 70,000 associates in 25 countries and operates 14 technical centers with 20 test tracks [3] - The company's sales in 2023 amounted to $10.5 billion [3] - Autoliv is committed to driving innovation, research, and development to sustainably deliver leading safety solutions [3]