Gentherm (THRM) Q4 2025 earnings summary

Executive summary

• Achieved record annual revenue of $1.5B in 2025, up 2.9% year-over-year, driven by strong new business awards totaling $2.2B in Automotive and expansion into adjacent markets.

• Announced a planned combination with Modine Performance Technologies, expected to close by year-end, creating a $2.6B market leader with significant end-market diversification and cost synergies.

• Focused on operational efficiency, business process standardization, and cash generation to drive margin expansion.

• Launched new products, including the Thermafix system in medical, with FDA 510(k) submission and expected revenue contribution in 2026.

Financial highlights

• 2025 revenue reached $1.5B, up 2.9% year-over-year (1.8% ex-FX); Automotive Climate & Comfort solutions revenue grew 5.8% ex-FX.

• Adjusted EBITDA for 2025 was $175M (11%-11.7% margin), down from 12.6% prior year, mainly due to higher material costs and footprint realignment expenses.

• Operating cash flow reached $117M, up 7% year-over-year, with net leverage reduced to 0.2x.

• Capital expenditures were $56M, down from $73M, and liquidity at year-end 2025 was $469M.

• Q4 2025 product revenues were $383M, with adjusted EBITDA margin at 10.6%.

Outlook and guidance

• 2026 revenue expected between $1.5B-$1.6B, with adjusted EBITDA guidance of $175M-$195M and adjusted free cash flow projected at $80M-$100M.

• Preliminary 2027 revenue outlook of $1.7B, up ~10% from 2026 midpoint, driven by strong launches and adjacent market growth.

• Margin expansion of ~30bps expected in 2026, with further improvement as footprint actions complete by 2027.

• Guidance assumes a low single-digit decline in light vehicle production for 2026 and current tariffs.