Stoneridge(US:SRI)2025-11-06 15:00Financial Data and Key Metrics Changes - In Q3 2025, adjusted EBITDA was $11.7 million, a $3.6 million improvement over the prior quarter, resulting in a margin of 5.6%, a 200 basis point increase [4][9] - Sales in Q3 were $210 million, a decline of 7.8% compared to Q2, primarily due to reduced customer production volumes in key commercial vehicle markets [8][15] - Adjusted operating income for Q3 was $2.4 million, with a 100 basis point improvement in adjusted operating margin compared to Q2 [15] Business Line Data and Key Metrics Changes - Control devices' Q3 sales were $72.5 million, a 1.9% increase from Q2, driven by higher sales in the North American passenger vehicle market [17] - Electronics segment reported Q3 sales of $128 million, impacted by production volume reductions in commercial vehicle markets, but adjusted operating margin improved by 250 basis points to 5.3% [19] - Stoneridge Brazil's Q3 sales totaled $18.9 million, a 23.5% increase from Q2, driven by higher local OEM sales [20] Market Data and Key Metrics Changes - North American commercial vehicle production fell by approximately 21% quarter to quarter, while European production declined by about 9% [8][19] - Despite market pressures, Mirai sales increased by 78% year-to-date compared to the previous year, with strong take rates in Europe [5][11] Company Strategy and Development Direction - The company is focused on long-term growth through advanced technologies and alignment with industry megatrends, driving new business awards and strong performance across segments [6][7] - A strategic review of alternatives for control devices is ongoing, with updates expected when appropriate [7][24] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing macroeconomic pressures affecting top-line performance but emphasized resilience in core operational performance [8][15] - The company expects continued volatility in end markets but remains focused on factors within its control to drive margin expansion [10][22] Other Important Information - The company updated its full-year revenue guidance to reflect lower production volume expectations, now guiding to the low end of the previous range of $860-$870 million [21][22] - Year-to-date adjusted free cash flow improved by $4.3 million, or approximately 36% relative to last year [23] Q&A Session Summary Question: What are the expectations for production volumes in the fourth quarter? - Management indicated potential production volume volatility due to uncertainty related to tariff policies and supply chain constraints [18] Question: How is the company addressing the impacts of macroeconomic conditions? - The company is focusing on advanced product development, commercial expansion, and improving material costs to drive margin expansion [18][22]