The Goodyear Tire(US:GT)2025-11-04 15:32Financial Performance - Goodyear's net sales in Q3 2025 were $4,645 million, a decrease of $179 million, or 3.7%, from $4,824 million in Q3 2024[207]. - Goodyear reported a net loss of $2,195 million, or $7.62 per share, in Q3 2025, compared to a net loss of $37 million, or $0.13 per share, in Q3 2024[191]. - Total segment operating income for Q3 2025 was $287 million, down from $346 million in Q3 2024, primarily due to increased conversion costs and lower tire volume[192]. - Goodyear's net sales for the first nine months of 2025 were $13,363 million, compared to $13,931 million in the same period of 2024, reflecting lower global tire volume and divestitures[193]. - Net sales for the first nine months of 2025 were $7,901 million, a decrease of $242 million, or 3.0%, from $8,143 million in the first nine months of 2024, primarily due to lower tire volume and the impact of the sale of the OTR tire business[258]. - The company reported a net loss of $2,106 million for the nine months ended September 30, 2025, compared to a net income of $26 million for the year ended December 31, 2024[338]. Segment Performance - Worldwide tire unit sales in Q3 2025 were 40.0 million units, a decrease of 2.5 million units, or 5.9%, from 42.5 million units in Q3 2024[209]. - The Americas unit sales in the third quarter of 2025 decreased by 1.4 million units, or 6.5%, primarily due to a decline in the consumer business[252]. - EMEA unit sales in Q3 2025 decreased by 0.2 million units, or 2.4%, to 12.0 million units, with replacement tire volume down 0.8 million units, or 8.6%[262]. - Asia Pacific unit sales in Q3 2025 decreased by 0.9 million units, or 9.2%, to 8.4 million units, with net sales down $117 million, or 18.9%, to $501 million[270][272]. Cost and Expenses - Cost of Goods Sold (CGS) in Q3 2025 was $3,801 million, a decrease of $81 million, or 2.1%, from $3,882 million in Q3 2024[210]. - CGS as a percentage of sales was 81.8% in Q3 2025, compared to 80.5% in Q3 2024[211]. - Selling, Administrative and General (SAG) expenses in Q3 2025 were $676 million, an increase of $13 million, or 2.0%, from $663 million in Q3 2024[212]. - Operating income for the first nine months of 2025 was $502 million, down $169 million, or 25.2%, from $671 million in the same period of 2024, driven by higher raw material and conversion costs[259]. Impairments and Charges - A goodwill impairment charge of $674 million was recorded in Q3 2025 related to the North America reporting unit[214]. - The company recorded a non-cash goodwill impairment charge of $674 million in the third quarter of 2025, impacting operating income significantly[255]. - The company maintained a valuation allowance of approximately $1.4 billion against U.S. net deferred tax assets as of September 30, 2025, reflecting concerns over realizability due to industry disruptions[241][243]. Cash Flow and Financing - Goodyear's cash and cash equivalents stood at $810 million as of September 30, 2025, with $2,547 million of unused availability under credit agreements[199]. - Net cash provided by investing activities increased by $1,422 million to $663 million in the first nine months of 2025, compared to a net cash used of $759 million in the same period of 2024[290]. - Net cash provided by financing activities decreased by $1,223 million to $92 million in the first nine months of 2025, compared to $1,315 million in the same period of 2024[291]. - The company may seek additional financing actions, including restructuring bank debt or capital markets transactions, due to future liquidity requirements[320]. Market Conditions and Outlook - Goodyear expects a decline of approximately 4% in global tire unit volume in Q4 2025 compared to Q4 2024, driven by lower consumer replacement volume[200]. - The company anticipates non-raw material inflation, tariffs, and other costs to increase by approximately $190 million in Q4 2025 compared to Q4 2024[203]. - The company faced significant global competition, which could adversely affect its market share and operating results[346]. - Inflationary cost pressures, including wages and energy costs, may materially impact the company's financial condition and operating results[346]. - The company is subject to extensive government regulations that may adversely affect its operating results[348]. Strategic Initiatives - The Goodyear Forward transformation plan is expected to provide approximately $750 million in segment operating income benefits for the full year of 2025[202]. - The company does not hedge commodity prices but employs strategies to offset cost increases for raw materials, which are primarily petroleum-based[350].