Sensata Technologies (ST) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue was $911.3M, down 9.5% year-over-year, but exceeded the high end of guidance, reflecting strong operational performance and early progress on capital allocation and growth initiatives.

• Free cash flow reached $87M, up 35% year-over-year, with conversion improving to 74%; cash on hand at quarter-end was $588.1M.

• Sensing Solutions segment delivered its first year-over-year growth since Q2 2023, indicating stabilization.

• Ransomware incident in April temporarily disrupted operations but had no material financial impact; full impact still under review.

• $100.5M–$101M used for share repurchases and $17.9M–$18M for dividends in Q1 2025.

Financial highlights

• Q1 2025 revenue was $911.3M, down from $1,007M in Q1 2024, but flat year-over-year after divestitures and up 1% sequentially.

• Adjusted operating income was $166.5M (18.3% margin), down 11.7% year-over-year but above guidance when excluding tariff impacts.

• Adjusted EPS was $0.78, down from $0.89 in Q1 2024, but exceeded guidance midpoint by $0.07.

• Free cash flow was $86.6M–$87M, up 34.6%–35% year-over-year.

• ROIC rose to 10.2% for the trailing twelve months, up 50 bps year-over-year.

Outlook and guidance

• Q2 2025 revenue expected between $910M and $940M, including ~$20M in tariff pass-through/recovery revenue.

• Adjusted operating income for Q2 expected at $169M–$177M; adjusted EPS guidance of $0.80–$0.86.

• Adjusted operating margin, excluding tariff impact, expected at 19.0%–19.2%.

• Anticipates $20M–$30M per quarter revenue impact in Q3 and Q4 from automotive production cuts, mainly in North America.

• Management expects sufficient liquidity to fund operations, capex, dividends, share repurchases, and debt service for at least the next 12 months.