Core Viewpoint - Lear Corp. reported adjusted earnings per share of $3.12 for Q1 2025, exceeding the Zacks Consensus Estimate of $2.64, driven by strong performance in the Seating segment, although it decreased from $3.18 in the same quarter last year [1] Financial Performance - Total revenues for Lear Corp. decreased by 7.24% year over year to $5.56 billion, slightly surpassing the Zacks Consensus Estimate of $5.55 billion [1] - The Seating segment generated sales of $4.15 billion, down from $4.48 billion year over year, but exceeded the Zacks Consensus Estimate by 1.1% [2] - The E-Systems segment reported sales of $1.41 billion, a decline of 7.12% year over year, missing the Zacks Consensus Estimate by 0.5% [3] Segment Performance - Adjusted earnings for the Seating segment were $280 million, down from $294.9 million year over year, but beat the Zacks Consensus Estimate by 16.2% [2] - The E-Systems segment's adjusted earnings were $73.8 million, down from $77.1 million in the same quarter last year, yet surpassed the Zacks Consensus Estimate by 25.4% [3] Regional Performance - North America sales fell by 9.2% year over year to $2.25 billion, missing the Zacks Consensus Estimate by 2.43% [4] - Sales in Europe and Africa decreased by 8.5% year over year to $2.06 billion, beating the Zacks Consensus Estimate by 7.28% [4] - Asia region sales totaled $1.07 billion, an increase of 1.12% year over year, but missed the Zacks Consensus Estimate by 0.5% [4] - South America sales were $177.8 million, down from $205.2 million year over year, missing the Zacks Consensus Estimate by 18.35% [5] Financial Position - As of March 29, 2025, Lear Corp. had $779.9 million in cash and cash equivalents, down from $1.05 billion at the end of 2024 [6] - Long-term debt remained unchanged at $2.73 billion as of March 29, 2025 [6] - The company reported a negative free cash flow of $231.7 million for the quarter [6] Share Repurchase and Guidance - During the quarter, Lear Corp. repurchased 263,003 shares for a total of $25 million, with a remaining share repurchase authorization of nearly $1.1 billion [7] - The company has not reaffirmed its full year 2025 guidance due to uncertain macroeconomic conditions [7]

Lear (LEA) reported $5.56 billion in revenue for the quarter ended March 2025, representing a year-over-year decline of 7.2%. EPS of $3.12 for the same period compares to $3.18 a year ago.The reported revenue represents a surprise of +0.09% over the Zacks Consensus Estimate of $5.56 billion. With the consensus EPS estimate being $2.64, the EPS surprise was +18.18%.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectati ...

Financial Data and Key Metrics Changes - The company reported revenue of $5.6 billion for the first quarter of 2025, with core operating earnings of $270 million and operating margins improving to 4.9% [6][32] - Adjusted earnings per share were $3.12, down from $3.18 a year ago, while operating cash flow was a use of $128 million in the first quarter [6][32] Business Line Data and Key Metrics Changes - In the Seating segment, sales were $4.2 billion, a decrease of 7% year-over-year, with adjusted operating margins at 6.7% [33] - The E Systems segment reported sales of $1.4 billion, also down 7% year-over-year, with adjusted earnings of $74 million and operating margins at 5.2% [34] Market Data and Key Metrics Changes - Global vehicle production increased by 1% year-over-year, but Lear's sales-weighted production declined by 5%, with North America down 5% and Europe down 7% [28][30] - In China, production volumes increased by 12%, but Lear's business lagged industry growth estimates by 5% [30] Company Strategy and Development Direction - The company aims to extend its leadership in Seating, expand margins in E Systems, and support sustainable value creation through disciplined capital allocation [7][8] - The company is focusing on operational excellence and innovation, particularly through its ComfortFlex modules, which have received positive recognition [9][10] Management's Comments on Operating Environment and Future Outlook - Management noted that the ongoing international trade negotiations have introduced significant uncertainty, particularly regarding tariffs and production volumes [35][36] - The company remains confident in recovering the costs associated with tariffs and is adjusting its capital spending in response to the weaker industry production outlook [38][39] Other Important Information - The company has paused share repurchase activities to maintain liquidity during uncertain times, with plans to resume once visibility improves [40][41] - The company has reduced its global hourly headcount by nearly 19,000 since the end of 2023, contributing to operational efficiency [17][18] Q&A Session Summary Question: Have you seen any meaningful changes to production schedules? - Management acknowledged that changes have been announced but noted the environment remains dynamic, leading to the decision to withdraw guidance due to uncertainty [48][49] Question: Is there a way to get your customers to be the importer of record for tariff reimbursements? - Management confirmed they are discussing options with customers regarding who will be the importer of record and are considering moving production around [55][56] Question: What is the lower end of your outlook contemplating as far as LVP by region? - Management indicated that the February guidance anticipated a 1% global production decline, with significant uncertainty remaining, particularly in North America [69][70] Question: What drove the better-than-expected margin performance? - Management attributed the improved margins to better-than-expected production and a strong finish in March, along with strong operating performance across both business segments [96][97] Question: Are you pausing the buyback while figuring out the outlook for free cash flow? - Management confirmed they are pausing share repurchases temporarily until there is more visibility on production plans [91][92]

Financial Data and Key Metrics Changes - The company reported revenue of $5.6 billion for the first quarter of 2025, with core operating earnings of $270 million and operating margins improving to 4.9% [5][29] - Adjusted earnings per share were $3.12, down from $3.18 a year ago, while operating cash flow was a use of $128 million in the first quarter [5][29] Business Line Data and Key Metrics Changes - In the Seating segment, sales decreased by 7% year-over-year to $4.2 billion, with adjusted earnings of $280 million and operating margins of 6.7% [30] - The E Systems segment also saw a 7% decline in sales to $1.4 billion, with adjusted earnings of $74 million and operating margins of 5.2% [31] Market Data and Key Metrics Changes - Global vehicle production increased by 1% year-over-year, but Lear's sales-weighted production was down 5%, with North America and Europe seeing declines of 5% and 7%, respectively [25][26] - In China, production volumes were up 12%, but Lear's business lagged industry growth estimates by five percentage points [27][28] Company Strategy and Development Direction - The company aims to extend its leadership in Seating, expand margins in E Systems, and support sustainable value creation through disciplined capital allocation [6][12] - Investments in automation and restructuring are expected to drive durable operating performance and margin improvements [15][34] Management's Comments on Operating Environment and Future Outlook - Management noted significant uncertainty in the automotive industry due to ongoing international trade negotiations and the impact of tariffs [32][34] - The company is confident in recovering costs associated with tariffs and is actively managing both direct and indirect exposures [17][19] Other Important Information - The company repurchased $25 million worth of shares during the quarter, but has paused share repurchase activity to maintain liquidity amid uncertainty [36][37] - The company has a strong balance sheet with $2.8 billion in available liquidity and no near-term debt maturities [35] Q&A Session Summary Question: Have you seen any meaningful changes to production schedules? - Management acknowledged seeing changes announced over the past few weeks but noted the environment remains dynamic [43][44] Question: Is there a way to get your customers to be the importer of record for tariff reimbursement? - Management confirmed they are discussing options with customers regarding who will be the importer of record [50][51] Question: What is the lower end of your outlook contemplating as far as LVP by region? - Management indicated that the February guidance anticipated a 1% global production decline and a 2% decline on a Lear-weighted basis [64] Question: How are you starting to see performance separate from competitors? - Management highlighted strong operational performance and innovation as key factors in gaining market share [72][75] Question: Do you see any risk from the current uncertainty on backlog? - Management stated it is too early to provide an update on the backlog but noted that new business awards will help long-term growth [88][90]

Financial Data and Key Metrics Changes - The company reported revenue of $5.6 billion for Q1 2025, with core operating earnings of $270 million and operating margins improving to 4.9% [6][12][31] - Adjusted earnings per share were $3.12, down from $3.18 a year ago, and operating cash flow was a use of $128 million in the first quarter [6][31] Business Line Data and Key Metrics Changes - In the Seating segment, sales decreased by 7% year-over-year to $4.2 billion, with adjusted operating margins at 6.7% [31][32] - The E Systems segment also saw a 7% decline in sales to $1.4 billion, with adjusted earnings of $74 million, reflecting a slight increase in operating margins to 5.2% [32][33] Market Data and Key Metrics Changes - Global vehicle production increased by 1% year-over-year, but Lear's sales-weighted production was down 5%, with North America and Europe seeing declines of 5% and 7% respectively, while China experienced a 12% increase [26][27] - Lear's sales growth in Europe outperformed industry production by 2 percentage points, while North America lagged by 2 percentage points [27][28] Company Strategy and Development Direction - The company aims to extend its leadership in Seating, expand margins in E Systems, and support sustainable value creation through disciplined capital allocation [7][12] - Recent awards in Seating and E Systems, including significant contracts with major automakers, highlight the company's focus on innovation and operational excellence [8][11][41] Management's Comments on Operating Environment and Future Outlook - Management noted ongoing uncertainty in the automotive industry due to international trade negotiations and tariff impacts, leading to a withdrawal of full-year guidance [34][35] - Despite challenges, the company remains confident in recovering tariff costs and achieving operational performance improvements [35][36] Other Important Information - The company has paused share repurchases to maintain liquidity during uncertain times, with plans to resume once visibility improves [39][86] - A strong balance sheet with no near-term debt maturities and $2.8 billion in available liquidity positions the company well for future challenges [38][39] Q&A Session Summary Question: Have you seen any meaningful changes to production schedules? - Management acknowledged some changes in production schedules but noted the environment remains dynamic, leading to the decision to withdraw guidance due to uncertainty [46][48] Question: Is there a way to get customers to be the importer of record for tariff reimbursements? - Management confirmed they are discussing options with customers regarding who will be the importer of record to maximize tariff reimbursement opportunities [52][53] Question: What is the lower end of your outlook contemplating as far as LVP by region? - Management indicated that the original guidance anticipated a 1% global production decline, with potential adjustments based on foreign exchange rates and market conditions [64][66] Question: How are you starting to see performance separate from competitors? - Management highlighted strong operational performance and innovation as key factors in gaining market share, particularly in E Systems [72][75] Question: Will you be able to offset indirect tariff impacts with accelerated restructuring benefits? - Management expressed confidence in achieving additional net performance from increased restructuring investments, despite dialing back capital spending [78][79]

Lear (LEA) came out with quarterly earnings of $3.12 per share, beating the Zacks Consensus Estimate of $2.64 per share. This compares to earnings of $3.18 per share a year ago. These figures are adjusted for non-recurring items. There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have change ...

Financial Performance - Sales decreased from $6 billion in Q1 2024 to $5.6 billion in Q1 2025[10] - Core operating earnings decreased from $280 million in Q1 2024 to $270 million in Q1 2025[10] - Adjusted earnings per share decreased from $3.18 in Q1 2024 to $3.12 in Q1 2025[10] - Operating cash flow decreased from negative $35 million in Q1 2024 to negative $128 million in Q1 2025[10] Segment Performance - Seating sales decreased from $4478 million in Q1 2024 to $4151 million in Q1 2025[27] - E-Systems sales decreased from $1517 million in Q1 2024 to $1409 million in Q1 2025[32] - Seating adjusted earnings were $294.9 million in Q1 2024 and $279.9 million in Q1 2025, with adjusted margins of 6.6% and 6.7% respectively[56] - E-Systems adjusted earnings were $77.1 million in Q1 2024 and $73.8 million in Q1 2025, with adjusted margins of 5.1% and 5.2% respectively[56] Production and Currency - Global vehicle production increased by 1% year-over-year, North America decreased by 5%, Europe and Africa decreased by 7%, and China increased by 12%[20] - The Euro decreased by 4% from $1.09/€ in Q1 2024 to $1.05/€ in Q1 2025[21]

Financial Performance - Revenue for Q1 2025 was $5.6 billion, a decrease of 7% compared to $6.0 billion in Q1 2024[4] - Net income for Q1 2025 was $81 million, down from $110 million in Q1 2024, with adjusted net income at $169 million compared to $183 million[4] - Core operating earnings were $270 million, representing 4.9% of sales, compared to $280 million or 4.7% of sales in Q1 2024[6] - Earnings per share were $1.49, down from $1.90 in Q1 2024, while adjusted earnings per share were $3.12 compared to $3.18[10] - Total net sales for Q1 2025 were $5,560.3 million, a decrease of 7.2% compared to $5,994.6 million in Q1 2024[29] - North America net sales decreased to $2,248.8 million from $2,475.9 million, representing a decline of 9.2%[29] - Seating segment net sales were $4,151.1 million, down from $4,477.6 million, a decrease of 7.3%[33] - E-Systems segment net sales decreased to $1,409.2 million from $1,517.0 million, a decline of 7.1%[33] Cash Flow and Operating Activities - Net cash used in operating activities was $(128) million, and free cash flow was $(232) million, compared to $(35) million and $(148) million in Q1 2024[10] - Free cash flow for Q1 2025 was $(231.7) million, compared to $(148.2) million in Q1 2024, indicating a worsening cash flow situation[29] Business Operations and Market Conditions - Operating margins increased year-over-year for both Seating and E-Systems segments, with approximately 125 basis points in Seating and approximately 155 basis points in E-Systems[4] - Awarded business in E-Systems totaling over $750 million in average annual sales[4] - Global vehicle production was up 1% year-over-year, with North America down 5%, Europe down 7%, and China up 12%[6] Shareholder Actions - Lear repurchased $25 million of shares during Q1 2025, with a remaining share repurchase authorization of approximately $1.1 billion[11] Financial Outlook - The company did not reaffirm its 2025 financial outlook due to uncertainty in industry production caused by evolving tariff environments[13] Assets and Liabilities - Total assets increased to $14,623.3 million in Q1 2025 from $14,027.5 million in Q4 2024, an increase of 4.3%[27] - Total liabilities and equity also rose to $14,623.3 million in Q1 2025 from $14,027.5 million in Q4 2024, reflecting a 4.3% increase[27] Adjusted Financial Metrics - Adjusted net income for Q1 2025 was $169.3 million, compared to $183.2 million in Q1 2024, a decline of 7.9%[31] - Diluted net income per share available to Lear decreased to $1.49 from $1.90, a drop of 21.6% year-over-year[31] - Core operating earnings for Q1 2025 were $270.4 million, down from $279.8 million in Q1 2024, reflecting a decrease of 5.0%[29]

Core Insights - Lear Corporation reported a solid start to 2025 with improved operational margins in both Seating and E-Systems segments despite lower industry production in key markets [3][4] - The company is facing challenges due to changes in global tariffs, which have created uncertainty in the automotive industry and impacted the cost structure of the supply chain [3][4] - Lear is focused on maintaining long-term competitiveness by managing near-term challenges, winning new business, and investing in automation and restructuring [3][4] Financial Performance - Total sales for Q1 2025 were $5,560.3 million, a decrease of 7% from $5,994.6 million in Q1 2024 [4][5] - Net income for Q1 2025 was $80.7 million, down from $109.6 million in the same period last year [4][5] - Adjusted net income was $169.3 million compared to $183.2 million in Q1 2024, with adjusted earnings per share at $3.12, down from $3.18 [4][5][8] Segment Performance - In the Seating segment, net sales were $4,151.1 million with segment margins of 5.2% and adjusted margins of 6.7% [34][35] - The E-Systems segment reported net sales of $1,409.2 million, with segment margins of 3.9% and adjusted margins of 5.2% [34][35] - Both segments experienced year-over-year margin improvements driven by efficiency gains and restructuring efforts [5][8] Cash Flow and Share Repurchase - Net cash used in operating activities was $(128) million, and free cash flow was $(232) million, compared to $(35) million and $(148) million in Q1 2024, respectively [5][9] - The company repurchased $25 million of shares during the quarter and had a remaining share repurchase authorization of approximately $1.1 billion [11][12] Market Outlook - Due to the uncertainty in industry production caused by evolving tariff environments, Lear is not reaffirming its 2025 financial outlook at this time [13] - The company remains confident in delivering its operating performance commitments as highlighted in previous earnings calls [13]

Company Overview - Lear (LEA) is expected to report earnings for the quarter ended March 2025, with a consensus estimate of $2.61 per share, reflecting a year-over-year decline of 17.9% [3] - Revenues are anticipated to be $5.56 billion, down 7.3% from the same quarter last year [3] Earnings Expectations - The earnings report is scheduled for release on May 6, 2025, and could influence stock movement based on whether actual results exceed or fall short of expectations [2] - The consensus EPS estimate has been revised 5.6% lower in the last 30 days, indicating a reassessment by analysts [4] Earnings Surprise Prediction - The Zacks Earnings ESP for Lear is +0.75%, suggesting a potential positive deviation from the consensus estimate [10][11] - However, Lear currently holds a Zacks Rank of 4 (Sell), complicating the prediction of an earnings beat [11] Historical Performance - In the last reported quarter, Lear exceeded the expected EPS of $2.59 by delivering $2.94, resulting in a surprise of +13.51% [12] - Over the past four quarters, Lear has beaten consensus EPS estimates consistently [13] Industry Context - In the Zacks Automotive - Original Equipment industry, Magna (MGA) is also expected to report earnings of $0.90 per share, down 16.7% year-over-year, with revenues projected at $9.53 billion, a decrease of 13.2% [17] - Magna's consensus EPS estimate has been revised 3.9% lower, but it has a higher Most Accurate Estimate leading to an Earnings ESP of 6.70% [18]