GTX Shares Lower on Cautious FY26 Automotive Production Outlook

Garrett Motion Inc. (NASDAQ:GTX) shares are trading lower premarket on Thursday after the company reported fourth-quarter earnings results.

Earnings Snapshot

The company reported net sales of $891 million, a 6% increase year-over-year (Y/Y), beating the $875.16 million consensus estimate.

By segment, sales of Commercial vehicles rose 9% Y/Y and aftermarket increased 4% Y/Y.

Net sales growth was led by favorable foreign currency and higher demand for commercial vehicles and diesel applications.

Adjusted earnings per share of 42 cents beat the 36 cents estimate. Net income totaled $84 million in the quarter.

Adjusted results included adjusted EBIT of $122 million, yielding an adjusted EBIT margin of 13.7%.

Cash Flow and Capital Allocation Highlights

The company’s operations generated robust cash, with operating cash flow totaling $99 million and adjusted free cash flow reaching $139 million.

Garrett maintained strong liquidity, reporting $807 million in available liquidity, including $177 million in cash and cash equivalents.

The company repurchased $72 million of common stock in the quarter.

On December 3, 2025, the company’s Board authorized a new $250 million share repurchase program, which is valid from January 1, 2026, until December 31, 2026.

"In 2025, we delivered solid growth, stronger margins and healthy free cash flow while expanding our product offerings. Our turbo business continued to win globally, and we accelerated in zero emission technologies, securing our first production wins for our E‑Powertrain and E‑Cooling technologies. At the same time, we made significant progress in further broadening our portfolio in industrial applications for power generation and industrial cooling.," said CEO Olivier Rabiller.

Outlook

Garrett expects FY26 sales of $3.60 billion-$3.80 billion vs consensus of $3.690 billion, adjusted EBIT of $520 million-$570 million, and adjusted free cash flow of $355 million-$455 million.

The company projects light vehicle industry production to be down 1% to 3%, commercial vehicle industry (including both on- and off-highway) to be up 1% to 2% and average light vehicle battery electric vehicle penetration of 19% in 2026.

Price Action: GTX shares were trading lower by 7.97% to $18.95 at last check on Thursday.

Image: Shutterstock