Financial Data and Key Metrics Changes - Sales for Q3 2025 were $917 million, a 6% decline year-over-year, primarily due to an unplanned production shutdown at JLR, which impacted sales by approximately $12 million [2][20][21] - Adjusted EBITDA was $119 million, with a margin of 13%, reflecting strong operational execution and cost control [3][20][23] - Adjusted free cash flow for the quarter was $110 million, supported by robust EBITDA performance [3][21] Business Line Data and Key Metrics Changes - Cockpit electronics business showed strong growth in Europe and the Americas, while BMS sales declined significantly year-over-year in the U.S. due to a challenging EV market [3][6][20] - In North America, cockpit electronics exceeded expectations, while BMS sales were down due to a saturated EV market [5][6] - In Europe, sales were flat year-over-year, with gains in cockpit electronics for ICE hybrids and battery electric vehicles [6][7] Market Data and Key Metrics Changes - Sales in China declined year-over-year, driven by a negative vehicle mix and market share loss of global OEMs, but remained stable sequentially [7][8] - The company secured $1.8 billion in new business during the quarter, with a strong focus on large display programs and AI-enabled cockpit systems [4][11] - The overall market environment remains challenging, particularly for EVs, with a price war among numerous car brands in China [15][16] Company Strategy and Development Direction - The company is focusing on expanding its product portfolio, particularly in cockpit electronics and AI-enabled systems, to address evolving market demands [4][18] - Strategic initiatives include diversifying the customer base and expanding into two-wheeler and commercial vehicle markets [18][19] - The company aims to exceed its original new business win target of $6 billion, now expecting to close the year at over $7 billion [11][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in returning to growth in China, with multiple new model launches expected in 2026 [36][44] - The company is closely monitoring the impact of recent trade restrictions on semiconductor suppliers, which could disrupt production [31][32] - Despite headwinds, management remains optimistic about long-term growth prospects, driven by increasing demand for digital content in vehicles [33] Other Important Information - The company resumed capital returns to shareholders with a newly initiated quarterly dividend and plans for additional capital returns in Q4 [4][21] - Capital expenditures for the year are trending towards $140 million, slightly lower than anticipated, with ongoing investments in vertical integration initiatives [30] Q&A Session Summary Question: Expectations for growth in China into 2026 - Management expects stabilization in Q4 and a return to growth in 2026, with about 20 new model launches planned, primarily in the back half of the year [36] Question: Indirect impacts of Nexperia supply issues - Management indicated that Visteon has a higher level of semiconductor inventory compared to peers, providing some cushion against supply disruptions [39] Question: Revenue growth target through 2027 - Management noted that while S&P Global forecasts a decline in vehicle production, they expect to outperform customer production in China next year [44] Question: Sustainability of new business booking momentum - Management believes the strong performance in new business wins, particularly in displays, is sustainable due to ongoing investments and market demand [48] Question: Profit implications for BMS in the coming years - BMS represents about 5% of sales, and while lower volumes may impact profitability, margins are expected to remain similar to other product lines [67]

Financial Data and Key Metrics Changes - Sales for Q3 2025 were $917 million, a 6% decline from the prior year, primarily due to an unplanned production shutdown at JLR [4][25][26] - Adjusted EBITDA was $119 million, with a margin of 13%, reflecting strong operational execution and cost control [6][26] - Adjusted free cash flow for the quarter was $110 million, driven by robust EBITDA performance [6][26] Business Line Data and Key Metrics Changes - Cockpit electronics business showed strong growth in Europe and The Americas, offset by lower sales in China and for Battery Management Systems (BMS) in the U.S. [5][8] - BMS sales were down significantly year over year, reflecting a challenging environment for EVs in 2025 compared to 2024 [8][25] - The company launched 28 new products across 10 different OEMs in Q3, indicating strong program execution capabilities [12][15] Market Data and Key Metrics Changes - Sales in North America for cockpit electronics exceeded expectations, while BMS sales were down significantly due to changes in the EV market [8][25] - In Europe, sales were flat year over year, with gains in cockpit electronics and ICE vehicles [9][11] - Sales in China declined year over year, primarily due to a negative vehicle mix and market share loss of global OEMs [11][12] Company Strategy and Development Direction - The company is focusing on expanding its product portfolio and securing new business wins, with expectations to exceed $7 billion in new business awards for the year [15][16] - Strategic initiatives include targeting underrepresented car OEMs in Asia and expanding into adjacent markets such as two-wheelers and commercial vehicles [23][24] - The introduction of AI-enabled cockpit systems is a key focus, with the company positioned well in this emerging technology trend [22] Management's Comments on Operating Environment and Future Outlook - Management acknowledged headwinds from the macro environment, particularly in China and for electric vehicles in the U.S., but maintained a positive outlook for adjusted EBITDA and free cash flow [6][39] - The company expects to return to growth in China, driven by new model launches and high-performance compute programs [48][61] - Concerns were raised regarding potential risks from recent trade restrictions imposed by the Chinese government on semiconductor suppliers, which could impact production [41][42] Other Important Information - The company resumed capital returns to shareholders with the initiation of a quarterly dividend and plans for additional capital returns in Q4 [7][35] - The company ended the quarter with $459 million in net cash, providing flexibility for investments and shareholder returns [27][35] Q&A Session Summary Question: Expectations for growth in China into 2026 - Management expects to return to growth in China, with about 20 new model launches planned for next year, predominantly in the back half of 2026 [46][48] Question: Impact of Nexperia trade restrictions - Management discussed the potential direct and indirect impacts of Nexperia's trade restrictions, noting that Visteon has a higher level of semiconductor inventory compared to peers, providing some cushion [49][54] Question: Direction of BMS sales into 2026 - Management anticipates BMS revenue to continue declining in 2026 due to headwinds in the EV market, with expectations for stabilization thereafter [62] Question: Sustainability of new business booking momentum - Management believes the current momentum in new business bookings is sustainable, driven by strong demand for displays and ongoing investments in product development [65][66] Question: Margin implications and recoveries from OEMs - Management indicated that margins have remained strong, with expectations for continued recoveries from OEMs related to volume adjustments [72][76]