Financial Data and Key Metrics Changes - Revenue for Q1 2026 was $3.6 billion, a 4% increase year-over-year, primarily driven by foreign exchange tailwinds and favorable volume and pricing [25][27] - Adjusted EBITDA improved by 10 basis points year-over-year to 5.7%, totaling $207 million [26][28] - Adjusted net income was $28 million or $0.35 per share during the quarter [26] Business Line Data and Key Metrics Changes - In the Americas, consolidated sales were generally in line with the broader market, while EMEA sales trailed the market due to customer mix and portfolio actions [27] - Asia outperformed, driven by significant growth in China as new programs with domestic OEMs ramped up [27] Market Data and Key Metrics Changes - North America vehicle production is expected to be around 15 million units for fiscal year 2026, up from previous guidance of 14.6 million [36] - China is expected to continue double-digit growth through fiscal year 2028, despite flat overall vehicle production [12] Company Strategy and Development Direction - The company is focused on onshoring opportunities, with approximately $500 million in potential revenue from onshoring and conquest wins [12][43] - Investments in automation are expected to ensure continued positive business performance, with most projects having a payback under two years [10] - The introduction of Modutec, a modular seat design solution, aims to enhance manufacturing efficiency and support onshoring priorities [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in delivering solid business performance due to a resilient operating model and positive production volume trends [9][10] - The company raised its guidance for revenue, adjusted EBITDA, and free cash flow for the fiscal year 2026 [36][37] Other Important Information - The company generated $15 million of free cash flow in Q1 2026, higher than internal expectations [32] - Total liquidity was $1.7 billion, comprised of $855 million in cash and $823 million in undrawn capacity under a revolving line of credit [34] Q&A Session Summary Question: Impact of potential disruptions on F-150 F-Series recovery - Management indicated that they are monitoring the situation and will provide updates based on Ford's guidance [40][41] Question: Update on onshoring opportunities - The company confirmed that onshoring opportunities have increased to $500 million, including a significant domestic OE production move from Mexico to the U.S. [43][45] Question: Progress on European restructuring - Management noted that restructuring spend in Europe is expected to be around $120 million to $130 million in fiscal year 2026, with a decrease anticipated in fiscal year 2027 [52][53] Question: Sustainability and commercial settlements - Management clarified that commercial settlements are part of normal business operations and timing mismatches are expected [60][62] Question: Growth opportunities in Asia and Europe - Management highlighted ongoing discussions with customers regarding onshoring and potential growth in the 2028-2029 timeframe, while also addressing competitive pressures from Chinese imports in Europe [71][82]

Financial Data and Key Metrics Changes - The company reported Q4 sales of $3.7 billion, a 4% increase compared to fiscal year 2024, with adjusted EBITDA of $226 million and an adjusted EBITDA margin of 6.1% [21][22] - Full year sales totaled approximately $14.5 billion, down 1% year over year, while adjusted EBITDA remained flat at $881 million [23][24] - Free cash flow for the year was $204 million, exceeding the high end of guidance, with $125 million returned to shareholders through share buybacks [4][5][31] Business Line Data and Key Metrics Changes - The Americas saw a margin expansion of 40 basis points for the full year, driven by lower launch costs and commercial actions despite a $17 million net tariff impact [28] - EMEA results were negatively impacted by a $36 million headwind from volume mix due to lower customer production volumes, although positive business performance of $17 million was noted [29] - In Asia, business performance contributed a $34 million tailwind, offsetting a $33 million volume mix headwind due to lower sales in China [29] Market Data and Key Metrics Changes - Sales in China trailed the market due to production declines from traditional premium OEM customers, while the rest of Asia outperformed due to prior customer launches ramping to full production [25] - The company expects to achieve double-digit growth over market in China and mid-single-digit growth in North America by 2027 [13][70] Company Strategy and Development Direction - The company is focusing on automation and AI integration to enhance operational efficiency and drive long-term growth [9][14] - A new strategic partnership in China aims to deepen engagement with leading OEMs and strengthen competitive positioning [13] - The company is committed to driving sustainable value through innovation and operational excellence, with a focus on winning new business and improving customer collaboration [12][19] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges from customer volume reductions and dynamic tariff policies but emphasized strong business execution and cash generation [4][5] - The outlook for fiscal year 2026 includes anticipated revenue declines in North America and Europe, partially offset by growth in China [34][39] - Management remains optimistic about future growth, particularly in China, and is focused on mitigating risks associated with tariffs and geopolitical factors [18][39] Other Important Information - The company has a strong liquidity position with $1.8 billion in total liquidity, including $958 million in cash and $814 million in undrawn credit [32][33] - The company plans to continue share repurchases and manage capital allocation prudently, with $135 million remaining in the share repurchase authorization [43] Q&A Session Summary Question: Can you provide insights on the 1% forecast underperformance versus S&P? - Management indicated that the underperformance is primarily due to F-150 downtime and the wind down of unprofitable business in Europe, which together account for the 1% drag [46][48] Question: What factors contribute to the high decremental volume mix? - The high decremental is attributed to unexpected F-150 downtime and Nexperia chip shortages, which have significantly impacted production and margins [51][52] Question: Can you elaborate on the $85 million investment for future growth? - The investment is essential for driving growth, with a focus on automation and AI, expected to yield significant savings over time [61][62] Question: What is the line of sight for growth over market in 2027? - Management expressed confidence in growth driven by customer launches in China and improved execution from Japanese OEMs in North America [70][71] Question: What are the expectations for revenue margins in Q1 2026? - Management anticipates a potential decline in EBITDA of $15 million to $20 million year on year due to production disruptions [84][86]