Adient plc: Q2 FY2026 earnings call

What management said about Q2 FY2026, from the documents filed with the SEC on 6 May 2026: press release. The quarter’s numbers.

Key takeaways

Net sales rose to $3,865 million: Net sales were $3,865 million, compared with $3,611 million in the same quarter of fiscal 2025. Americas and Asia both reported higher segment net sales. Source
Adjusted EBITDA fell year on year: Adjusted EBITDA was $223 million, against $233 million a year earlier. Adjusted EBITDA margin was 5.8%, compared with 6.5%. Six-month adjusted EBITDA was $430 million against $429 million. Source
Adjusted EPS fell to $0.52: Adjusted diluted earnings per share were $0.52, against $0.69 a year earlier. Adjusted net income attributable to Adient was $41 million, compared with $58 million. Source
Asia margin fell to 12.5%: Asia net sales were $734 million, up from $707 million. Asia adjusted EBITDA was $92 million against $110 million, a margin of 12.5% compared with 15.6%. Source
Operating cash flow turned positive: Operating cash flow was $81 million, against negative $45 million. Capital expenditures were $73 million against $45 million. Free cash flow was $8 million against negative $90 million. Source
Net leverage ratio rose to 1.77: The net leverage ratio was 1.77, against 1.63 at September 30, 2025 and 1.72 at December 31, 2025. Source

“Management uses the identified non-GAAP measures to evaluate the operating performance of Adient and its business segments and to forecast future periods.”
Adient plc, press release

Guidance

Area	Period	Figure	Against last quarter
Commercial and derivative transactions (operating cash flow) Source	Third quarter of fiscal 2026	approximating $90 million

Results and growth drivers

Net sales rose to $3,865 million: Net sales were $3,865 million, compared with $3,611 million in the same quarter of fiscal 2025. Americas and Asia both reported higher segment net sales. Source
Adjusted EBITDA fell year on year: Adjusted EBITDA was $223 million, against $233 million a year earlier. Adjusted EBITDA margin was 5.8%, compared with 6.5%. Six-month adjusted EBITDA was $430 million against $429 million. Source
Net income positive after prior-year charges: Net income attributable to Adient was $27 million, against a loss of $335 million. Diluted EPS was $0.34, compared with a loss of $3.99. The prior-year quarter included $351 million of restructuring and impairment costs. Source
Adjusted EPS fell to $0.52: Adjusted diluted earnings per share were $0.52, against $0.69 a year earlier. Adjusted net income attributable to Adient was $41 million, compared with $58 million. Source

Segments and regions

Americas sales and EBITDA rose: Americas net sales were $1,884 million, up from $1,699 million. Americas adjusted EBITDA was $109 million against $94 million, a margin of 5.8% compared with 5.5%. Source
EMEA margin fell to 3.5%: EMEA net sales were $1,272 million, up from $1,231 million. EMEA adjusted EBITDA was $45 million against $50 million, a margin of 3.5% compared with 4.1%. Source
Asia margin fell to 12.5%: Asia net sales were $734 million, up from $707 million. Asia adjusted EBITDA was $92 million against $110 million, a margin of 12.5% compared with 15.6%. Source
Corporate costs rose slightly: Corporate-related costs not allocated to the segments were $23 million, compared with $21 million a year earlier. Source

“Management believes these non-GAAP measures assist investors and other interested parties in evaluating Adient's on-going operations and provide important supplemental information to management and investors”
Adient plc, press release

Costs, margins and tax

Gross profit and SG&A both lower: Gross profit was $257 million against $261 million. Selling, general and administrative expenses were $138 million against $144 million. Source
Adjusted EBIT margin fell to 3.8%: Adjusted EBIT was $146 million against $161 million, a margin of 3.8% compared with 4.5%. Adjusted EBITDA margin was 5.8% against 6.5%. Source
Adjusted tax rate rose: The adjusted effective tax rate was 39.2%, compared with 28.9% a year earlier. Reported income tax provision was $32 million against $48 million. Source
Equity income slightly lower: Equity income was $13 million against $18 million. Adjusted equity income was $14 million against $19 million. Source

Cash flow and working capital

Operating cash flow turned positive: Operating cash flow was $81 million, against negative $45 million. Capital expenditures were $73 million against $45 million. Free cash flow was $8 million against negative $90 million. Source
Six-month free cash flow positive: Free cash flow for the six months was $23 million, compared with negative $45 million a year earlier. Source
Receivables absorbed cash: Receivables used $411 million of cash, against $439 million a year earlier. Accounts receivable were $2,032 million, up from $1,873 million at September 30, 2025. Source
Working capital outflow smaller: Working capital was an outflow of $79 million, against $207 million in the prior-year quarter. Cash taxes were $54 million and interest paid $43 million, both above the prior-year quarter. Source

Capital, debt and cash balance

Net debt rose to $1,557 million: Net debt was $1,557 million at March 31, 2026, against $1,439 million at September 30, 2025. Cash and cash equivalents were $831 million, down from $855 million at December 31, 2025. Source
Net leverage ratio rose to 1.77: The net leverage ratio was 1.77, against 1.63 at September 30, 2025 and 1.72 at December 31, 2025. Source
Capital spending higher year on year: Capital expenditures were $73 million, compared with $45 million in the prior-year quarter. Source
Investing and financing outflows: Cash used by investing activities was $75 million and cash used by financing activities was $7 million, against $44 million and $47 million a year earlier. Source

Shareholders and noncontrolling interests

Shares outstanding down to 78.4 million: Shares outstanding at period end were 78.4 million, against 84.0 million a year earlier. Diluted weighted average shares were 79.3 million. Source
Dividends to noncontrolling interests lower: Dividends paid to noncontrolling interests were $1 million, against $35 million a year earlier. Source
Noncontrolling income lower: Income attributable to noncontrolling interests was $17 million, against $22 million a year earlier. Source

Other quarters

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.

As filed with the SEC

Open the filing on EDGAR

Appendix

Adient plc

Condensed Consolidated Statements of Income (Loss)

	Three Months Ended March 31,
(in millions, except per share data)		2026		2025
Net sales	$3,865		$3,611
Cost of sales	3,608		3,350
Gross profit	257		261
Selling, general and administrative expenses	138		144
Restructuring and impairment costs	5		351
Equity income	13		18
Earnings (loss) before interest and income taxes	127		(216)
Net financing charges	48		48
Other pension expense	3		1
Income (loss) before income taxes	76		(265)
Income tax provision	32		48
Net income (loss)	44		(313)
Income attributable to noncontrolling interests	17		22
Net income (loss) attributable to Adient	$27		$(335)
Diluted earnings (loss) per share	$0.34		$(3.99)
Shares outstanding at period end	78.4		84.0
Diluted weighted average shares	79.3		84.0

Appendix

Adient plc

Condensed Consolidated Statements of Financial Position

	March 31,		September 30,
(in millions)		2026		2025
Assets
Cash and cash equivalents	$831		$958
Accounts receivable - net	2,032		1,873
Inventories	735		695
Other current assets	649		607
Current assets	4,247		4,133
Property, plant and equipment - net	1,384		1,409
Goodwill	1,798		1,807
Other intangible assets - net	305		319
Investments in partially-owned affiliates	301		276
Assets held for sale	12		9
Other noncurrent assets	985		1,001
Total assets	$9,032		$8,954
Liabilities and Shareholders' Equity
Short-term debt	$9		$11
Accounts payable and accrued expenses	3,113		2,942
Other current liabilities	748		734
Current liabilities	3,870		3,687
Long-term debt	2,379		2,386
Other noncurrent liabilities	695		723
Redeemable noncontrolling interests	71		95
Shareholders' equity attributable to Adient	1,713		1,766
Noncontrolling interests	304		297
Total liabilities and shareholders' equity	$9,032		$8,954

Appendix

Adient plc

Condensed Consolidated Statements of Cash Flows

	Three Months Ended March 31,
(in millions)		2026		2025
Operating Activities
Net income (loss) attributable to Adient	$27		$(335)
Income attributable to noncontrolling interests	17		22
Net income (loss)	44		(313)
Adjustments to reconcile net income (loss) to cash provided (used) by operating activities:
Depreciation	68		67
Amortization of intangibles	12		12
Pension and postretirement benefit expense	5		3
Pension and postretirement contributions, net	(8)		(5)
Equity in earnings of partially-owned affiliates, net of dividends received	15		29
Deferred income taxes	1		10
Non-cash impairment charges	-		333
Equity-based compensation	9		5
Other	1		5
Changes in assets and liabilities:
Receivables	(411)		(439)
Inventories	17		18
Other assets	15		(5)
Accounts payable and accrued liabilities	336		223
Accrued income taxes	(23)		12
Cash provided (used) by operating activities	81		(45)
Investing Activities
Capital expenditures	(73)		(45)
Sale of property, plant and equipment	-		2
Investments in partially-owned affiliates	(2)		-
Other	-		(1)
Cash used by investing activities	(75)		(44)
Financing Activities
Drawdown of ABL revolver and other bank borrowings	150		2
Repayment of ABL revolver and other bank borrowings	(152)		-
Issuance of long-term debt	-		795
(Repayment) of long-term debt	(3)		(797)
Debt financing costs	(1)		(12)
Dividends paid to noncontrolling interests	(1)		(35)
Cash used by financing activities	(7)		(47)
Effect of exchange rate changes on cash and cash equivalents	(23)		30
Decrease in cash and cash equivalents	$(24)		$(106)

Appendix

Footnotes

1. Segment Results

Adient manages its business on a geographic basis and operates in the following three reportable segments for financial reporting purposes: 1) Americas, which is inclusive of North America and South America; 2) Europe, the Middle East and Africa ("EMEA") and 3) Asia Pacific/China ("Asia").

Adient evaluates the performance of its reportable segments using an adjusted EBITDA metric defined as income (loss) before income taxes and noncontrolling interests, excluding net financing charges, restructuring and impairment costs, restructuring related-costs, net mark-to-market adjustments on pension and postretirement plans, transaction gains/losses, purchase accounting amortization, depreciation, stock-based compensation and other non-recurring items. Also, certain corporate-related costs are not allocated to the segments. The reportable segments are consistent with how management views the markets served by Adient and reflect the financial information that is reviewed by its chief operating decision maker.

Financial information relating to Adient's reportable segments is as follows:

(in millions)	Three months ended March 31, 2026
	Americas	EMEA	Asia	Corporate/Eliminations	Consolidated
Net sales	$1,884	$1,272	$734	$(25)	$3,865
Adjusted EBITDA	$109	$45	$92	$(23)	$223
Adjusted EBITDA margin	5.8%	3.5%	12.5%	N/A	5.8%
	Three months ended March 31, 2025
	Americas	EMEA	Asia	Corporate/Eliminations	Consolidated
Net sales	$1,699	$1,231	$707	$(26)	$3,611
Adjusted EBITDA	$94	$50	$110	$(21)	$233
Adjusted EBITDA margin	5.5%	4.1%	15.6%	N/A	6.5%

Appendix

The following is a reconciliation of Adient's reportable segments' adjusted EBITDA to income (loss) before income taxes:

	Three Months Ended March 31,
(in millions)		2026		2025
Adjusted EBITDA
Americas	$109		$94
EMEA	45		50
Asia	92		110
Subtotal	246		254
Corporate-related costs	(23)		(21)
Restructuring and impairment costs	(5)		(351)
Purchase accounting amortization	(12)		(12)
Restructuring related activities	(6)		(5)
Equity based compensation	(9)		(5)
Depreciation	(68)		(67)
Other items	4		(9)
Earnings (loss) before interest and income taxes	$127		$(216)
Net financing charges	(48)		(48)
Other pension expense	(3)		(1)
Income (loss) before income taxes	$76		$(265)

2. Earnings (loss) Per Share

The following table reconciles the numerators and denominators used to calculate basic and diluted income (loss) per share:

	Three Months Ended March 31,
(in millions, except per share data)		2026		2025
Income available to shareholders
Net income (loss) attributable to Adient	$27		$(335)
Weighted average shares outstanding
Basic weighted average shares outstanding	78.4		84.0
Effect of dilutive securities:
Unvested restricted stock and unvested performance share awards	0.9		-
Diluted weighted average shares outstanding	79.3		84.0
Earnings (loss) per share:
Basic	$0.34		$(3.99)
Diluted	$0.34		$(3.99)

The effect of common stock equivalents which would have been anti-dilutive was excluded, and immaterial, from the calculation of diluted earnings per share for the three months ended March 31, 2026. Potentially dilutive securities whose effect would have been anti-dilutive are excluded from the computation of diluted earnings per share for the three months ended March 31, 2025 as a result of being in a loss position.

Appendix

3. Non-GAAP Measures

Adjusted EBIT, adjusted EBIT margin, adjusted EBITDA, adjusted EBITDA margin, adjusted net income (loss) attributable to Adient, adjusted effective tax rate, adjusted earnings per share, adjusted equity income, adjusted interest expense, free cash flow, net debt, and net leverage ratio as well as other measures presented on an adjusted basis are not recognized terms under U.S. GAAP and do not purport to be alternatives to the most comparable U.S. GAAP amounts. Since all companies do not use identical calculations, our definition and presentation of these measures may not be comparable to similarly titled measures reported by other companies. Management uses the identified non-GAAP measures to evaluate the operating performance of Adient and its business segments and to forecast future periods. Management believes these non-GAAP measures assist investors and other interested parties in evaluating Adient's on-going operations and provide important supplemental information to management and investors regarding financial and business trends relating to Adient's financial condition and results of operations. Investors should not consider these non-GAAP measures as alternatives to the related GAAP measures. Reconciliations of non-GAAP measures to their closest U.S. GAAP equivalent are presented in the corresponding tables that follow the definitions below. Reconciliations of non-GAAP measures related to guidance for any future period have not been provided due to the unreasonable efforts it would take to provide such reconciliations.

Table

Adjusted EBIT is defined as earnings (loss) before income taxes and noncontrolling interests excluding net financing charges, restructuring, impairment and related costs, purchase accounting amortization, transaction gains/losses, other significant non-recurring items, and net mark-to-market adjustments on pension and postretirement plans. Adjusted EBIT margin is adjusted EBIT as a percentage of net sales.
Adjusted EBITDA is defined as adjusted EBIT excluding depreciation and equity based compensation. Certain corporate-related costs are not allocated to the business segments in determining adjusted EBITDA. Adjusted EBITDA margin is adjusted EBITDA as a percentage of net sales.
Adjusted net income attributable to Adient is defined as net income (loss) attributable to Adient excluding restructuring, impairment and related costs, purchase accounting amortization, transaction gains/losses, other significant non-recurring items, net mark-to-market adjustments on pension and postretirement plans, the tax impact of these items and other discrete tax charges/benefits.
Adjusted income tax expense is defined as income tax expense adjusted for the tax effect of the adjustments to income before income taxes and other discrete tax changes/benefits. Adjusted effective tax rate is defined as adjusted income tax provision as a percentage of adjusted income before income taxes.
Adjusted diluted earnings per share is defined as adjusted net income attributable to Adient divided by diluted weighted average shares.
Adjusted equity income is defined as equity income excluding amortization of Adient's intangible assets related to its non-consolidated joint ventures and other unusual or non-recurring items impacting equity income.
Adjusted interest expense is defined as net financing charges excluding unusual or one-time items impacting interest expense.
Free cash flow is defined as cash provided by operating activities less capital expenditures.
Net debt is calculated as total debt (short-term and long-term) less cash and cash equivalents.
Net leverage ratio is calculated as net debt divided by adjusted EBITDA for the last four quarters.

Appendix

Reconciliations of non-GAAP measures to their closest US GAAP equivalent:

(a) & (b) Adjusted EBIT and Adjusted EBITDA

The following table reconciles net income (loss) to EBIT, adjusted EBIT and adjusted EBITDA:

	Three Months Ended March 31,
(in millions)		2026		2025
Net income (loss)	$44		$(313)
Net financing charges	48		48
Other pension expense	3		1
Income tax expense	32		48
Earnings (loss) before interest and income taxes (EBIT)	$127		$(216)
EBIT adjustments:
Restructuring and impairment costs	5		351
Purchase accounting amortization	12		12
Restructuring related activities	6		5
Other items	(4)		9
EBIT adjustments total	19		377
Adjusted EBIT	$146		$161
EBITDA adjustments:
Depreciation	68		67
Equity based compensation	9		5
Adjusted EBITDA	$223		$233
Net sales	$3,865		$3,611
Net income (loss) as % of net sales	1.1%		(8.7)%
EBIT as % of net sales	3.3%		(6.0)%
Adjusted EBIT as % of net sales	3.8%		4.5%
Adjusted EBITDA as % of net sales	5.8%		6.5%

Appendix

The following table reconciles net income (loss) attributable to Adient to adjusted net income attributable to Adient:

	Three Months Ended March 31,
(in millions)		2026		2025
Net income (loss) attributable to Adient	$27		$(335)
Net income adjustments:
EBIT adjustments total - see table (a) & (b)	19		377
Tax impact of EBIT adjustments and other tax items - see table (d)	(6)		15
Pension actuarial loss	2		-
Write off of deferred financing costs upon repurchase of debt	-		2
Impact of adjustments on noncontrolling interests	(1)		(1)
Net income adjustments total	14		393
Adjusted net income attributable to Adient	$41		$58

(d) Adjusted income tax expense and effective tax rate

The following table reconciles income before income taxes to adjusted income before income taxes, reconciles income tax expense to adjusted income tax expense and presents the related effective tax rate and adjusted effective tax rate:

	Three months ended March 31,
	2026				2025
(in millions, except effective tax rate)	Income before income taxes	Income tax expense (benefit)	Effective tax rate		Income before income taxes	Income tax expense (benefit)	Effective tax rate
As reported	$76	$32	42.1%		$(265)	$48	(18.1)%
Adjustments
EBIT adjustments - see table (a) & (b)	19	3	15.8%		377	16	4.2%
Tax audit closures and statute expirations	-	3		nm	-	1		nm
UTP establishments and interest	-	(2)		nm	-	(11)		nm
NOL DTA adjustments	-	-		nm	-	(19)		nm
Pension actuarial loss	2	-	- %		-	-		nm
Net financing charges	-	-		nm	2	-	- %
Other	-	2		nm	-	(2)		nm
Subtotal of adjustments	21	6	28.6%		379	(15)	(4.0)%
As adjusted	$97	$38	39.2%		$114	$33	28.9%

nm - not meaningful

Appendix

(e) Adjusted diluted earnings per share

The following table shows the calculation of diluted earnings per share on an adjusted basis:

	Three Months Ended March 31,
(in millions, except per share data)		2026		2025
Numerator:
Adjusted net income attributable to Adient - see table (c)	$41		$58
Denominator:
Basic weighted average shares outstanding	78.4		84.0
Effect of dilutive securities:
Unvested restricted stock and unvested performance share awards	0.9		0.1
Diluted weighted average shares outstanding	79.3		84.1
Adjusted diluted earnings per share	$0.52		$0.69

The following table reconciles diluted earnings (loss) per share as reported to adjusted diluted earnings per share (see table (c) for corresponding dollar amounts):

	Three Months Ended March 31,
	2026	2025
Diluted earnings (loss) per share as reported	$0.34	$(3.99)
EBIT adjustments total	0.24	4.49
Tax impact of EBIT adjustments and other tax items	(0.08)	0.18
Pension actuarial loss	0.03	-
Write off of deferred financing costs upon repurchase of debt	-	0.02
Impact of adjustments on noncontrolling interests	(0.01)	(0.01)
Adjusted diluted earnings per share	$0.52	$0.69

(f) Adjusted equity income

The following table reconciles equity income to adjusted equity income:

	Three Months Ended March 31,
(in millions)		2026		2025
Equity income	$13		$18
Equity income adjustments:
Restructuring charges at affiliates	1		-
Non-recurring loss at affiliates	-		1
Equity income adjustments total	1		1
Adjusted equity income	$14		$19

Appendix

(g) Adjusted interest expense

The following table reconciles net financing charges to adjusted net financing charges:

	Three Months Ended March 31,
(in millions)		2026		2025
Net financing charges	$48		$48
Interest expense adjustments:
Write off of deferred financing costs upon repurchase of debt	-		(2)
Interest expense adjustments total	-		(2)
Adjusted net financing charges	$48		$46

(h) Free cash flow

The following table reconciles cash from operating activities to free cash flow:

	Three Months Ended March 31,				Six Months Ended March 31,
(in millions)		2026		2025		2026		2025
Operating cash flow	$81		$(45)		$161		$64
Capital expenditures	(73)		(45)		(138)		(109)
Free cash flow	$8		$(90)		$23		$(45)

The following table reconciles adjusted EBITDA to free cash flow:

	Three Months Ended March 31,				Six Months Ended March 31,
(in millions)		2026		2025		2026		2025
Adjusted EBITDA	$223		$233		$430		$429
Adjusted equity income	(14)		(18)		(43)		(39)
Dividends from partially owned affiliates	28		46		28		52
Restructuring (cash)	(19)		(33)		(38)		(67)
Working capital	(79)		(207)		(40)		(146)
Interest paid	(43)		(33)		(97)		(87)
Cash taxes	(54)		(24)		(74)		(39)
Other	39		(9)		(5)		(39)
Capital expenditures	(73)		(45)		(138)		(109)
Free cash flow	$8		$(90)		$23		$(45)

During the second quarter of fiscal 2026, Adient experienced higher operating cash flows resulting from certain commercial and derivative transactions approximating $90 million, which are expected to be settled and paid in the third quarter of fiscal 2026.

Appendix

(i) & (j) Net debt and net leverage ratio

The following table presents calculations of net debt and net leverage ratio:

	March 31,		September 30,
(in millions)		2026		2025
Numerator:
Short-term debt	$ -		$2
Current portion of long-term debt	9		9
Long-term debt	2,379		2,386
Total debt	2,388		2,397
Less: cash and cash equivalents	831		958
Net debt	$1,557		$1,439
Denominator:
Adjusted EBITDA - last four quarters
Q1 2025		na	$196
Q2 2025		na	233
Q3 2025	226		226
Q4 2025	226		226
Q1 2026	207			na
Q2 2026 - see table (a) & (b)	223			na
Last four quarters	$882		$881
Net leverage ratio		1.77		1.63

Appendix

Footnote Addendum

(1) Corporate-related costs not allocated to the segments include executive office, communications, corporate development, legal and corporate finance.

(2) Reflects restructuring charges for costs that are probable and reasonably estimable and one-time asset impairments related to restructuring activities. During the three months ended March 31, 2025 a goodwill impairment charge of $333 million was recorded in EMEA.

(3) Reflects amortization of intangible assets including those related to partially owned affiliates recorded within equity income.

(4) Reflects restructuring-related charges for costs that are recorded as incurred or as earned and other non-recurring impacts that are directly attributable to restructuring activities:

	Three Months Ended March 31,
(in millions)		2026		2025
Restructuring related charges	$(5)		$(5)
Restructuring charges at affiliates	(1)		-
	$(6)		$(5)

(5) Other items include:

	Three Months Ended March 31,
(in millions)		2026		2025
Non-recurring reserve release	$5		$ -
Transaction costs	(1)		-
Consulting costs associated with strategic planning	-		(8)
Non-recurring loss at an affiliate	-		(1)
	$4		$(9)

(6) Reflects the impact of adjustments, primarily purchase accounting amortization on noncontrolling interests.