Garrett Motion (GTX) Q1 2025 earnings summary

Executive summary

• Q1 2025 net sales were $878 million, down 4% year-over-year, with gasoline segment up 6% and diesel and aftermarket segments declining; operating margin and adjusted EBIT margin improved to 14.9% due to cost actions and productivity gains.

• Net income was $62 million (7.1% margin), down from $66 million (7.2%) in Q1 2024, mainly due to higher tax expense and other costs.

• Announced first major series production award for high-speed electric motor and inverter technology, with production expected in 2027.

• Returned $42 million to shareholders via $30 million in share repurchases and $12 million in dividends; declared Q2 dividend of $0.06 per share.

• Completed major refinancing, extending term loan maturity to 2032 and increasing revolving facility to $630 million, supporting robust liquidity.

Financial highlights

• Net sales: $878 million, down 4% year-over-year (2% on constant currency), with $21 million FX headwind.

• Gross profit increased to $179 million (20.4% margin) from $172 million (18.8%) year-over-year.

• Adjusted EBIT reached $131 million, up $10 million year-over-year, with margin expanding to 14.9% from 13.2%.

• Adjusted free cash flow was $36 million, in line with expectations, reflecting working capital seasonality.

• Liquidity at quarter-end: $760 million, including $130 million cash and $630 million undrawn revolver.

Outlook and guidance

• 2025 outlook maintained: net sales $3.3–$3.5 billion, constant currency sales growth -3% to +2%, net income $209–$254 million, adjusted EBIT $427–$487 million, adjusted EBITDA $545–$605 million, adjusted free cash flow $300–$390 million.

• Assumes direct tariff pass-through, light vehicle industry down 3% to flat, commercial vehicle industry flat to +2%, and 16% BEV penetration.

• Outlook excludes potential impact of future global trade policy changes and inflation.