Dana (DAN) Investor update summary

Strategic achievements and portfolio transformation

• Completed sale of Off-Highway business for $2.7 billion, netting $2.4 billion after costs and debt, and used proceeds to pay down $1.9 billion in debt.

• Increased cost reduction target to $325 million, with $250 million realized in 2025 and an additional $65 million expected in 2026.

• Merged Power Technologies into core segments and completed buyout of TM4 joint venture for under $200 million.

• Returned over $700 million to shareholders in 2025 through buybacks and dividends, with $200–$300 million in buybacks planned for 2026.

• Achieved highest free cash flow since 2013 and improved balance sheet to less than 1x leverage.

Financial performance and 2026 outlook

• 2025 revenue reached $7.5 billion with adjusted EBITDA of $600 million (8% margin) and $315 million in free cash flow.

• Q4 2025 results exceeded consensus, with $1.9 billion revenue and 10.7% EBITDA margin.

• 2026 guidance: sales of $7.3–$7.7 billion, EBITDA of $750–$850 million (10.0–11.0% margin), and $250–$350 million in free cash flow.

• Margin expansion driven by cost savings, elimination of stranded costs, accretive new business, and improved plant performance.

• CapEx for 2026 expected at 4% of sales, with working capital improvements anticipated.

Market and backlog developments

• Three-year backlog increased to $750 million, with $200 million growth in 2026, mostly from light truck programs.

• Backlog growth offsets a slightly down market, with new programs and content extensions in both light and commercial vehicles.

• Aftermarket business, now 12% of sales, is a renewed focus area with expansion in North America and Europe.

• Commercial vehicle share gains driven by investments in low-cost manufacturing and new platform wins.

• Expectation for further backlog growth in early 2026 due to robust quoting activity.