Strong Full-Year Financial Performance
Full-year 2025 net sales of $3.58 billion and adjusted EBIT of $510 million representing a 14.2% adjusted EBIT margin; adjusted free cash flow for the year was $403 million, with free cash flow conversion near 80%.
Robust Q4 Results
Q4 2025 net sales of $891 million and adjusted EBIT of $122 million with a 13.7% margin; adjusted free cash flow in the quarter was $139 million.
2026 Financial Outlook and Margin Expansion
2026 midpoint guidance: net sales $3.7 billion, net income $315 million, adjusted EBIT $545 million (14.7% margin, +50 bps vs 2025 midpoint), net cash from operations $455 million and adjusted free cash flow $405 million; margin improvement expected from higher volumes and productivity.
Exceptional Cash Generation and Capital Returns
Strong liquidity position of $807 million at year-end; net leverage ~1.9x after voluntary $50 million term loan repayment; returned capital via $208 million share repurchases and $52 million dividends in 2025; authorized $250 million repurchase program for 2026; targeting ≈75% of adjusted FCF to shareholders over time.
Market Share Gains and Product Awards
Continued share-of-demand gains in light vehicle turbos (noted historical win rate >50%); secured significant new light-vehicle turbo awards (gasoline VNT, hybrid and range-extended EV platforms) and important diesel awards for light commercial vehicles and trucks; first series production awards for largest turbo frame (MEG) including aftermarket retrofit sales.
Diversification and Commercial Traction in Zero-Emission & Industrial Technologies
Strategic collaboration with Trane Technologies for oil-free, high-speed centrifugal compressors for commercial HVAC; first series production award with leading Chinese bus and truck HVAC supplier; announced E-Powertrain production awards (heavy-duty electric axle production beginning early 2027); industrial cooling (E-Cooling) expected to scale to >5% of revenue by end of decade.
Technology Performance Claims
E-Cooling oil-free centrifugal compressors demonstrated >10% real-world energy savings vs incumbent solutions in testing; product range covers 7–500 tonnes (25–1,750 kW) enabling multiple industrial and data center cooling applications.
Disciplined Capital Allocation and Controlled CapEx
2026 CapEx guidance of ~2.5% of sales and RD&E ~4.2% of sales with ~50% of RD&E directed to zero-emission technologies and industrial cooling; management states E-Cooling-related CapEx is included in the 2.5% guidance and will be disciplined.