Visteon Corporation Q4 FY2025 earnings call

• Strategic work underway for growth: Diversifying customer base, especially with specification automakers; software defined vehicles expanding into adjacent markets; increasing vertical integration in manufacturing. • 2025 saw 86 vehicle model launches across 19 manufacturers, aligned with industry trends. • Secured significant new business wins, including with Toyota, Honda, etc. • Strong operational performance with new product launches in various regions.

Net sales were $3,768 million. Displays sales grew ~20% YoY, contributing to revenue. Battery management systems were a headwind due to softer US EV demand and China market dynamics. Adjusted EBITDA was $492 million (13.1% of sales), a record. New business wins were a record $7,400 million. Americas sales impacted by lower customer vehicle production and EV production drops; Europe was a standout with product launches; Rest of Asia sales flat; China sales declined. Displays and SmartCore accounted for ~three quarters of new business wins in 2025.

• 2026 sales expected to be in range of $3,625 million to $3,825 million. • Headwinds in 2026 include lower US EV production, Ford vehicle model discontinuations, ~2% headwind from net pricing, foreign exchange, etc. • Adjusted EBITDA expected between $455 million to $495 million. • Adjusted free cash flow expected ~$170 million to $210 million. • 2026 capital allocation: Prioritize investment in business, increase quarterly dividend to $0.375 per share, remain active in share repurchases.

• Memory chip supply tightness across the industry, working with suppliers to mitigate gaps. • Industry challenges such as market dynamics shifts in China, US EV demand fluctuations, and competition from Chinese OEMs. • Potential timing mismatches in customer recoveries related to memory cost increases.

Q: Dig into DRAM exposure relative to product portfolio, scaling 2% impact to guidance and supply side.

A: Visteon uses various memories, engaged with suppliers early, developing alternate replacements.

Q: Weighting of revenue in 2026, first half vs second half.

A: Second half slightly better due to back loaded launches.

Q: Clarification on memory exposure and launch activity.

A: Memory cost increase ~2% of sales, healthy launch activity in 2026.

Q: M&A pipeline.

A: Bolt on, technology/capability accretive, margin accretive from day one.

Q: Discontinued vehicles and BMS planning.

A: BMS to recover modestly, 2026 BMS volume decline ~50%, 2027 expected modest recovery.

Q: Memory recoveries and capital deployment.

A: Intending to recover memory costs, capital deployment prioritizing business investment, dividend, and share repurchases