Gentherm (THRM) Q1 2026 earnings summary

Executive summary

• Achieved record quarterly revenue of $394 million (up 11.3% year-over-year), driven by strong Automotive Climate and Comfort Solutions growth and outperformance in China.

• Announced a transformative combination with Modine Performance Technologies, valued at $1 billion and expected to close in Q4 2026, expanding product portfolio and end-market exposure.

• Initiated organizational realignment and restructuring to increase agility, accountability, and reduce layers, with expected annual OpEx savings of $10 million.

• Expanded into home, office, and medical markets, including a key launch with KUKA HOME and FDA submission for ThermAffyx medical product.

• Net income for the quarter was $4.2 million, up from a net loss of $0.1 million in Q1 2025.

Financial highlights

• Revenue reached $394 million, up 11.3% year-over-year; 7.2% growth excluding FX.

• Adjusted EBITDA was $49.3 million (12.5% margin), up from $39.3 million (11.1%) year-over-year.

• Adjusted diluted EPS was $0.84, up from $0.51 year-over-year; GAAP EPS was $0.14, impacted by merger and restructuring expenses.

• Gross margin expanded to 24.7% from 24.4% year-over-year.

• Cash flow from operations improved to $(5.0) million from $(13.3) million year-over-year; liquidity at $455.5 million.

Outlook and guidance

• 2026 guidance unchanged: product revenues of $1.5B–$1.6B, adjusted EBITDA of $175M–$195M, and adjusted free cash flow of $80M–$100M.

• Guidance assumes a low single-digit decline in light vehicle production and EUR/USD exchange rate of 1.16.

• Margins expected to be lower in Q2 and Q3 due to $20 million in incremental inflationary costs and inventory transitions.

• CapEx projected at $45M–$55M (~3% of sales), down from 2025 midpoint.

• Guidance does not reflect impact from the planned Modine combination.