10-Q · July 23, 2026
Visteon's Q2 revenue of $960 million was modestly above consensus and sequentially improved, but was $9 million below the prior-year quarter. Profitability weakened materially year over year: gross margin declined to…
Earnings analysis · 10-Q
VC earnings analysis
Filed October 22, 2026 · Our reading of the company's report
The latest report
Visteon delivered $970 million of third-quarter revenue, up $53 million year over year, but profitability deteriorated sharply as $77 million of warranty charges and inflation drove gross margin down to approximately…
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Visteon delivered $970 million of third-quarter revenue, up $53 million year over year, but profitability deteriorated sharply as $77 million of warranty charges and inflation drove gross margin down to approximately 4.8% and adjusted EBITDA to $46 million from $119 million. Nine-month operating cash flow fell to $81 million from $292 million as receivables and inventory consumed $135 million of additional working capital. Liquidity remains meaningful at $466 million of cash and $374 million of revolver availability, but weaker customer production, margin pressure, and continued capital returns create a more challenging near-term risk profile.
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.
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
- Gross margin
- 4.8%
What stood out
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Revenue grew despite weaker vehicle production
Third-quarter net sales increased $53 million year over year to $970 million from $917 million, driven primarily by $57 million from volume, mix and net new business and $5 million from customer pricing.
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Warranty charges sharply reduced gross profitability
Gross margin fell to $47 million, or approximately 4.8% of sales, from $131 million, or approximately 14.3%, a year earlier. Cost of sales increased $137 million to $923 million, including approximately $77 million of warranty charges and material-cost inflation.
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Reported earnings improved, underlying EBITDA weakened
Net income attributable to Visteon was $5 million versus a $11 million loss in the prior-year quarter, helped by income-tax expense of $1 million versus $90 million. Adjusted EBITDA, however, declined $73 million to $46 million from $119 million.
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Liquidity remained substantial
The company retained $466 million of cash and cash equivalents at September 30, 2026, including $2 million of restricted cash, against $26 million of outstanding borrowings and $374 million of available revolving credit.
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Shareholder returns remained a priority
Management authorized an $800 million share-repurchase program through 2029 and had returned approximately $500 million to shareholders since 2023 through the third quarter of 2026. The company completed a $200 million accelerated share repurchase during the nine-month period.
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Year-to-date profitability and cash conversion deteriorated
Nine-month revenue rose $64 million to $2.884 billion, but gross margin fell $132 million to $278 million and adjusted EBITDA fell $116 million to $266 million. Operating cash flow decreased to $81 million from $292 million.
What to watch
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Warranty and cost inflation pressure margins
Two distinct warranty charges totaled approximately $77 million in the quarter and reduced adjusted EBITDA by $85 million when combined with material inflation and the non-recurrence of one-time items. Adjusted EBITDA fell to $46 million from $119 million year over year.
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Working-capital build weakened cash flow
Operating cash flow fell to $81 million from $292 million in the prior-year nine-month period, primarily because of $135 million of higher working-capital outflows driven by increased accounts receivable and inventory.
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Customer production declines threaten demand
The filing states that global light-vehicle production declined approximately 2% in the quarter, while production at Visteon's key customers declined approximately 5%; China customer production declined approximately 17%. Management also expects 2026 global production to decline approximately 2% and key-customer production approximately 4%.
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Capital deployment reduces liquidity flexibility
The company had $26 million of outstanding borrowings and $374 million of available revolving credit, while cash totaled $466 million. Cash was reduced by shareholder distributions and capital deployment, and the company cited BB+ and Ba1 corporate credit ratings.
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Semiconductor and tariff uncertainty increased
The filing identifies memory-chip shortages and supplier capacity being allocated to data-center infrastructure as potential sources of cost pressure and production disruption. It also states that tariff effects could increase production costs and weigh on future vehicle volumes, although effects had been minimal to date.
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Restructuring adds execution and cash costs
Nine-month restructuring expense rose to $17 million from $4 million, primarily due to a program approved in the first quarter of 2026. Management estimates total cash restructuring payments through 2026 of approximately $20 million.
Management's outlook
The 10-Q does not provide explicit company revenue or EPS guidance. It cites external expectations that 2026 global light-vehicle production will decrease approximately 2% and production for Visteon's key customers will decline approximately 4%. Previously disclosed 2026 outlook was provided in the October 22, 2026 earnings release rather than this filing.
Earlier filings 4
10-Q · April 23, 2026
Visteon reported Q1 net sales of $954 million, up $20 million year‑over‑year, but results show margin compression and weaker cash generation. Gross margin fell $25 million to $113 million and Adjusted EBITDA declined…
10-K · February 19, 2026
Visteon positions itself as a global automotive electronics supplier focused on digital cockpits, domain controllers (SmartCore), CognitoAI, battery management systems and high‑voltage power electronics, selling to…
10-Q · October 23, 2025
Visteon reported Q3 net sales of $917 million (down $63 million vs. Q3 2024) with diluted EPS of $2.04, up from $1.40 a year ago. Gross margin dollars were stable at $131 million while operating performance and cash…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.