Magna International (MG) investor relations material

Executive summary

• Q2 2026 delivered strong results with 3% sales growth to $11.0 billion, 16% higher adjusted EBIT to $677 million, and 29% higher adjusted EPS to $1.86, driven by operational excellence and disciplined execution, outperforming a 2% decline in global light vehicle production.

• Free cash flow more than doubled year-over-year to $617 million, with operating cash flow at $954 million.

• S&P reaffirmed an A- credit rating with a stable outlook; leverage ratio improved to 1.4x and cash on hand was $1.4 billion.

• Over 90% of 2028 business is already booked, supporting future growth.

• Returned $598 million to shareholders in Q2 via dividends and share repurchases.

Financial highlights

• Q2 sales were $11.0 billion, up 3% year-over-year; organic sales up 2% excluding FX.

• Adjusted EBIT margin expanded 70 bps to 6.2%; adjusted EBIT was $677 million, up $94 million year-over-year.

• Adjusted EPS set a Q2 record at $1.86, up 29% year-over-year.

• Free cash flow of $617 million, more than double last year; operating cash flow was $954 million.

• Interest expense fell by $15 million due to lower debt and strong cash flow.

Outlook and guidance

• Full-year 2026 outlook raised: adjusted EBIT margin now 6.3%-6.6%, adjusted EPS $6.70-$7.30, free cash flow $1.75-$1.85 billion.

• Sales guidance updated to $41.3-$42.5 billion, reflecting FX headwinds and earlier divestitures.

• Sales growth over market expected at 1%-3% (excluding Complete Vehicles).

• Third and fourth quarters expected to show higher margins year-over-year, with a 40/60 EPS split favoring Q4.

• Macro assumptions: North America light vehicle production at 15.0 million units, Europe at 16.8 million, China at 31.2 million.