Lear (LEA) Q4 2025 earnings summary

Executive summary

• Achieved $23.3 billion in full-year 2025 sales and $6.0 billion in Q4, with adjusted EPS of $12.80 for the year and $3.41 for Q4, marking the fifth consecutive annual increase.

• Delivered record net performance savings of $195 million, exceeding margin improvement targets in both Seating and E-Systems.

• Secured major new business awards, including the largest Seating conquest in company history and $1.4 billion in E-Systems awards, with significant contracts in North America and China.

• Returned nearly $500 million to shareholders through $325 million in share repurchases and $165 million in dividends, exceeding initial buyback targets.

• Operational excellence, digital transformation, and automation initiatives drove performance, including the launch of the Lear Fellowship with Palantir.

Financial highlights

• Q4 2025 sales increased 5% year-over-year to $6.0 billion; full-year net sales were $23.3 billion, with core operating earnings of $1.1 billion (4.6% margin).

• Adjusted EPS for 2025 was $12.80 (up 1%); Q4 adjusted EPS was $3.41 (up 16% year-over-year).

• Free cash flow for 2025 was $527 million, with a 77% conversion rate; operating cash flow was $1.1 billion.

• Q4 core operating earnings were $259 million (4.3% of sales); full-year core operating earnings were $1,062 million (4.6% of sales).

• Cash and cash equivalents at year-end were $1.0 billion, with total liquidity of $3.0 billion.

Outlook and guidance

• 2026 net sales expected between $23.2 billion and $24.01 billion; core operating earnings projected at $1.03 billion to $1.2 billion; adjusted EBITDA at $1.65 billion to $1.82 billion.

• Free cash flow guidance for 2026 is $550 million to $650 million, with >80% conversion; share repurchases targeted at over $300 million.

• Capital spending planned at $660 million for launches and automation; no major strategic acquisitions planned.

• Industry production expected to decline less than 1% year-over-year in 2026; guidance assumes conservative volume for key platforms.

• Outlook excludes potential impacts from future tariff changes or major production disruptions.