10-Q · July 17, 2026
Autoliv delivered Q2 revenue of $2.803 billion, up 3.3% year over year, and 1.0% organic growth, but reported profitability was burdened by Türkiye restructuring: GAAP operating margin fell to 6.8% from 9.1% and diluted…
Earnings analysis · 10-Q
ALV earnings analysis
Filed October 23, 2026 · Our reading of the company's report
The latest report
Autoliv delivered a mixed third quarter: revenue declined 0.5% year over year to $2,693 million and diluted EPS fell 6.8% to $2.13, but operating margin improved sharply from 6.8% in the prior quarter to 9.4%. Asia,…
Read full summary
Autoliv delivered a mixed third quarter: revenue declined 0.5% year over year to $2,693 million and diluted EPS fell 6.8% to $2.13, but operating margin improved sharply from 6.8% in the prior quarter to 9.4%. Asia, particularly India and Chinese domestic OEMs, offset weakness in the Americas, EMEA, and Chinese global OEMs. Cash generation remained positive, although free operating cash flow declined to $124 million and working capital absorbed $45 million. Full-year sales and operating-cash-flow targets were maintained, while adjusted operating-margin guidance was narrowed to around 10.5% because of higher cost headwinds.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $2.13
- Segment
- Airbags, Steering Wheels and Other: $1,847 million revenue, up 0.9% reported and 0.2% organically year over year.
- Segment
- Seatbelt Products and Other: organic sales decreased 3.9% year over year.
- Segment
- Americas: organic sales decreased 2.9%; EMEA: decreased 2.9%; Asia excluding China: increased 8.8%; China: decreased 5.8%.
What stood out
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Asia offset broader sales weakness
Third-quarter revenue was $2,693 million, down 0.5% year over year and approximately 3.8% below the prior quarter’s $2.8 billion. Revenue exceeded global LVP by 0.8 percentage points organically, with organic sales down 1.1% versus a 1.9% global LVP decline.
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Strong India and Chinese OEM growth
Asia excluding China grew 8.8% organically, including 29% organic growth in India, while sales to Chinese domestic OEMs increased organically by around 21%. Chinese OEMs represented 58% of China sales versus around 46% a year earlier.
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Sequential margin recovery
GAAP operating margin was 9.4%, down 0.4 percentage points year over year but up 2.6 percentage points from 6.8% in the prior quarter. Adjusted operating margin was 9.7%, supported by cost reductions and $26 million of higher engineering income.
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Positive but lower cash generation
Operating cash flow was $239 million versus $258 million a year earlier, while free operating cash flow was $124 million versus $153 million. Capital expenditure was $115 million, or 4.3% of sales, compared with 3.9% in the prior-year quarter.
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EPS rebounded sequentially
Diluted EPS was $2.13, down 6.8% from $2.28 year over year but up $0.78 from $1.35 in the second quarter. EPS was negatively affected by $0.16 from higher taxes and $0.13 from lower operating income, partly offset by $0.11 from fewer diluted shares.
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Leverage stable despite shareholder returns
Net debt was $1,763 million at September 30, 2026, versus $1,695 million at June 30 and $1,772 million a year earlier. Leverage remained controlled at 1.3x, while the company repurchased 1.23 million shares for $150 million and paid $63 million of dividends during the quarter.
What to watch
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Raw-material inflation persists
Raw-material inflation had a gross profitability impact of around $42 million in the quarter, and management estimates a gross impact of around $120 million for full-year 2026. Cost reductions and customer and supplier negotiations are expected to offset most, but not necessarily all, of the pressure.
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Tariff recovery remains uncertain
Tariffs produced a net negative impact of around $6 million in the quarter and reduced operating margin by around 35 basis points after compensation. Recovery of tariff costs remains uncertain, although full-year tariff-related dilution is estimated at around 20 basis points.
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Working-capital and supply-chain pressure
Operating working capital reduced third-quarter operating cash flow by $45 million, including a $71 million increase in inventories and a $21 million receivables increase, partly offset by $52 million from accounts payable and accrued liabilities. Management also cited flooding in Thailand and lower call-off accuracy as additional cost headwinds.
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Restructuring charges continue
The filing states that there were no material changes to the risk factors disclosed in the February 19, 2026 Form 10-K. Nevertheless, capacity-alignment costs in Türkiye contributed to negative other income of $5 million in the quarter, and the nine-month period included $70 million of negative other income mainly related to restructuring.
Management's outlook
Full-year 2026 organic sales growth guidance remains around 0%, operating cash flow around $1.2 billion, and net capital expenditures around 4% of sales. Adjusted operating margin guidance was narrowed to around 10.5% from the prior 10.5%-11% range. Management anticipates a strong fourth quarter supported by product launches and raw-material recoveries, subject to no material changes in tariffs, trade restrictions, macroeconomic conditions, call-off volatility, or supply-chain disruptions.
Earlier filings 2
10-Q · April 17, 2026
Autoliv reported revenue of $2,753 million in Q1 2026, up from $2,578 million in Q1 2025, with gross profit rising to $526 million but operating income falling to $237 million. Operating cash flow swung to a use of $76…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.