On February 26, 2025, Stoneridge Inc (SRI, Financial) released its 8-K filing detailing the financial results for the fourth quarter and full-year ending December 31, 2024. Stoneridge Inc, a manufacturer of electrical and electronic components for automotive vehicles, reported a quarterly revenue of $218.2 million, which fell short of the analyst estimate of $222.04 million. However, the company's adjusted earnings per share (EPS) of -$0.18 was worse than the estimated -$0.04.
Company Overview
Stoneridge Inc is a key player in the automotive industry, producing a range of products including instrumentation systems, vehicle management electronics, and sensors. The company operates primarily in North America and is divided into three segments: Control Devices, Electronics, and Stoneridge Brazil. The Electronics segment, which includes driver information systems and camera-based vision systems, is the largest revenue generator for the company.
Performance and Challenges
Stoneridge Inc faced several challenges in 2024, including a net loss of $16.5 million for the year, compared to a net loss of $5.2 million in 2023. The company attributed these losses to continued pressure across major end markets and higher operating expenses. Despite these challenges, Stoneridge managed to improve its fundamentals, achieving a 120-basis point improvement in material costs and a 30-basis point improvement in direct labor costs.
Financial Achievements
Stoneridge Inc reported a significant improvement in cash flow, with net cash provided by operating activities increasing by approximately $43 million year-over-year, driven by a $36 million reduction in inventory. The company also achieved a positive free cash flow of approximately $24 million, marking an increase of $56 million compared to the previous year. These achievements are crucial for maintaining liquidity and supporting future growth initiatives in the competitive Vehicles & Parts industry.
Key Financial Metrics
For the fourth quarter of 2024, Stoneridge reported a gross profit of $42.7 million, representing 19.5% of sales, and an adjusted gross profit of $43.1 million, or 19.7% of sales. The operating loss for the quarter was $4.4 million, with an adjusted operating loss of $4.0 million. The company's adjusted EBITDA for the quarter was $6.0 million, or 2.7% of sales.
| Metric | Q4 2024 | Full-Year 2024 |
|---|---|---|
| Sales | $218.2 million | $908.3 million |
| Gross Profit | $42.7 million | $189.3 million |
| Net Loss | $(6.1) million | $(16.5) million |
| Adjusted EBITDA | $6.0 million | $37.9 million |
Analysis and Outlook
Stoneridge Inc's performance in 2024 highlights both the challenges and opportunities facing the company. While the revenue fell short of expectations, the company demonstrated resilience by improving cash flow and reducing costs. The focus on growth drivers such as MirrorEye and Smart 2 tachograph, along with cost management strategies, positions Stoneridge for potential recovery and growth in the coming years.
Jim Zizelman, president and CEO, stated, "In 2024, our focus remained on improving the fundamentals of our business to offset the continued pressure across all of our major end markets. Our efforts resulted in a 120-basis point improvement in material costs and a 30-basis point improvement in direct labor costs, or a 7% year-over-year improvement relative to 2023."
Looking ahead, Stoneridge has set a 2025 revenue guidance midpoint of $875 million and an EBITDA guidance midpoint of $40 million. The company is also targeting a 2026 revenue of at least $975 million and an EBITDA of at least $70 million, indicating a strategic focus on long-term growth and profitability.
Explore the complete 8-K earnings release (here) from Stoneridge Inc for further details.
