BorgWarner (BWA) investor relations material

Executive summary

• Q2 2026 net sales were $3,648M–$3.65B, flat to up 0.3% year-over-year, with gross profit at $721M and gross margin improving to 19.8% from 17.6%.

• Adjusted EPS increased 17–17.4% year-over-year to $1.42, supported by cost controls and share repurchases.

• The company exited its charging business, consolidated North American battery systems, and settled a $78M VAT claim with PHINIA.

• Seven new business awards were announced across hybrid, electric, and drivetrain technologies, with launches from 2026 to 2029.

• Share repurchase authorization increased by $1B, reflecting strong liquidity and commitment to shareholder value.

Financial highlights

• Q2 2026 net sales were $3,648M–$3.65B, up slightly or flat year-over-year.

• Adjusted operating income rose to $413M (11.3% margin); GAAP operating income was $370M (10.1% margin).

• Adjusted diluted EPS was $1.42, up from $1.21 in Q2 2025.

• Free cash flow was $492M in Q2 2026.

• Operating cash flow for the first half was $738M, up from $661M in 2025.

Outlook and guidance

• Full-year 2026 net sales expected between $14.0B and $14.3B.

• Organic net sales change (excluding battery) forecasted at (3.5%) to (1.5%) year-over-year.

• Adjusted operating margin guidance of 10.7% to 10.9%.

• Adjusted diluted EPS guidance raised to $5.05–$5.30.

• Free cash flow guidance maintained at $900M to $1,100M.