Schaeffler (SHA0) Q3 2025 earnings summary

Executive summary

• Achieved 1.3% FX-adjusted sales growth in Q3 2025, with strong free cash flow and improved EBIT margin despite a soft market environment.

• Gross margin improved to 20.3% (excluding SAP write-off), with reported margin at 18.5% due to a EUR 204 million SAP license impairment.

• EBIT margin rose to 4.5% from 3.5% in Q3 2024; EPS was negative due to one-offs but positive on an adjusted basis.

• Free cash flow before M&A reached EUR 175 million, a significant turnaround from EUR -364 million in Q3 2024.

• Major organizational realignment effective January 2025, with new divisional structure and reporting.

Financial highlights

• Q3 2025 sales: EUR 5,826 million; gross margin: 20.3% (reported 18.5%); EBIT margin: 4.5%.

• Free cash flow before M&A: EUR 175 million; net financial debt: EUR 4,613 million; leverage ratio: 2.3x.

• Capex in Q3: EUR 244 million, with a reinvestment rate of 0.5x.

• All divisions contributed to EBIT margin improvement; Americas and Asia-Pacific showed strong sales growth.

• Net income attributable to shareholders was -€244 million, compared to €218 million in the prior year.

Outlook and guidance

• FY 2025 sales guidance: EUR 23.0–25.0 billion; EBIT margin (before special items): 3–5%.

• Free cash flow guidance raised to EUR 0–200 million (prior: -200 to 0 million).

• Bearings & Industrial Solutions EBIT margin guidance increased to 6–8% (prior: 5–7%).

• Market expects global light vehicle production to grow 2.0% in 2025; industrial production to rise 2.5%.

• Q4 expected to be seasonally weaker, but E-Mobility and Powertrain & Chassis margins should remain strong.