Stoneridge (SRI) Q1 2025 earnings summary

Executive summary

• Q1 2025 sales were $217.9 million, with record MirrorEye and SMART 2 sales, and margin improvement across all segments, despite an 8.9% year-over-year sales decline and a net loss of $7.2 million ($0.26 per share), driven by lower North American/European volumes but offset by strong Brazil OEM growth.

• Adjusted gross margin improved by 210 basis points quarter-over-quarter, driven by material and quality-related cost reductions.

• Free cash flow was $4.9 million, up $1.5 million year-over-year, reflecting strong cash and inventory management.

• Business realignment charges of $2.8 million were incurred for operational efficiency, mainly at the Juarez facility.

• Maintained full-year guidance due to outperformance and conservative assumptions on vehicle production volumes, despite market volatility and tariff risks.

Financial highlights

• Q1 2025 sales were $217.9 million, gross margin was 21.2% (up from 20.2% in Q1 2024), and adjusted gross margin was 21.9%.

• Adjusted EBITDA was $7.6 million (3.5% of sales), up 80 basis points from Q4 2024.

• Net loss was $7.2 million, or $0.26 per share; adjusted operating loss was $0.4 million.

• Free cash flow was $4.9 million, up $1.5 million year-over-year.

• Cash and cash equivalents were $79.1 million; total debt was $203.2 million as of March 31, 2025.

Outlook and guidance

• Full-year 2025 guidance maintained: sales of $860–$890 million, adjusted gross margin of 22.0–22.5%, adjusted operating margin of 0.75–1.25%, and adjusted EBITDA of $38–$42 million.

• Free cash flow guidance for 2025 is $25–$30 million; net debt to EBITDA leverage ratio targeted at 2.0x–2.5x by year-end.

• Outlook remains cautious due to market softness, tariffs, and ongoing operational initiatives, with continued focus on cost reduction and operational excellence.

• Electronics segment expected to outperform market due to MirrorEye and tachograph launches; Stoneridge Brazil anticipates continued OEM growth.

• Conservative planning and ongoing customer engagement to address potential volume declines.