Lear Corp (LEA) Q2 2025 Earnings Call Highlights: Strong Revenue and Strategic Wins Amid Market …

• Revenue: $6 billion in the second quarter.

• Core Operating Earnings: $292 million.

• Operating Margin: 4.8%.

• Adjusted Earnings Per Share: $3.47.

• Operating Cash Flow: $296 million.

• Seating Segment Sales: $4.5 billion, up 1% from 2024.

• Seating Segment Operating Margin: 6.7%.

• E-Systems Segment Sales: $1.6 billion, down 1% from 2024.

• E-Systems Segment Operating Margin: 4.9%.

• Share Repurchase: $25 million in the quarter, $50 million in the first half.

• Dividend: Maintained at $0.77 per share.

• Full Year Revenue Outlook: Approximately $22.8 billion.

• Full Year Core Operating Earnings Outlook: Approximately $1.025 billion.

• Free Cash Flow Outlook: $470 million at the midpoint of guidance.

Release Date: July 25, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

• Lear Corp (NYSE:LEA) delivered $6 billion in revenue for Q2 2025, with core operating earnings of $292 million and an operating margin of 4.8%.

• The company increased its full-year net performance outlook by approximately $25 million to over $150 million, reflecting strong operating performance.

• Lear Corp (NYSE:LEA) reinstated its share repurchase plan, buying back $25 million in shares during the quarter and $50 million in the first half of the year.

• The partnership with Palantir has been extended, enhancing Lear Corp (NYSE:LEA)’s digital and operational capabilities, driving efficiency gains.

• Lear Corp (NYSE:LEA) won significant new business in both Seating and E-Systems segments, including key conquest programs with BMW and Ford, and a large global EV automaker.

• Global production was flat on a Lear sales-weighted basis, with declines in North America and Europe, impacting sales.

• Sales in the E-Systems segment decreased by 1% year-over-year, driven by lower volumes and the wind down of discontinued product lines.

• The company faces macroeconomic uncertainties, including potential impacts from tariffs and trade policies, which could affect future performance.

• Lear Corp (NYSE:LEA) experienced a lag in cash repayment of tariff recoveries from customers, impacting free cash flow.

• The company anticipates a significant decline in volume and mix in the second half of 2025, leading to a projected margin contraction.

Q: Can you explain the expected deceleration in margins for the second half of the year? A: Jason Cardew, CFO, explained that the strong first-half performance was due to effective cost management and commercial negotiations. However, some commercial recoveries were pulled into the first half, affecting the second half’s performance. Additionally, the second half faces tougher year-over-year comparisons, particularly in E-Systems, due to efficiency improvements realized in the previous year.