Lear (LEA) Q4 2024 earnings summary

Executive summary

• 2024 revenue was $23.3B, with core operating earnings of $1.1B (4.7% margin) and adjusted EPS of $12.62, supported by share repurchases and margin expansion despite lower industry volumes.

• Achieved 80% free cash flow conversion, enabling $400M in share repurchases and $174M in dividends.

• Strategic priorities included innovation, automation, workforce reductions, and new product launches, especially in China and with EV automakers.

• Outperformed industry volume by 2 percentage points in total revenue; E-Systems outperformed by 6 points.

• Continued focus on operational efficiency, product innovation, and cash generation.

Financial highlights

• Q4 2024 sales were $5.7B, with core operating earnings of $258M and adjusted EPS of $2.94.

• Full year operating cash flow was $1.1B; free cash flow was $561M.

• Seating 2024 sales: $17.2B (6.5% margin); E-Systems: $6.1B (5.1% margin), with E-Systems margins improving for the second consecutive year.

• Adjusted net income for 2024 was $713M; adjusted EBITDA was $1.7B.

• Cash and equivalents at year-end were $1.1B; total liquidity was $3.1B.

Outlook and guidance

• 2025 net sales expected at $21.9B–$22.9B; core operating earnings guidance: $915M–$1.18B.

• Adjusted net income forecast: $575M–$765M; adjusted EBITDA: $1.54B–$1.80B; free cash flow: $430M–$630M (80% conversion target maintained).

• Operating margins for both segments expected to remain flat; restructuring costs of ~$175M planned.

• 2025 outlook assumes a 1% decline in global vehicle production and continued growth in China.

• Assumes global industry production will be 2% lower than 2024 on a sales-weighted basis.