Q4 2025 Borgwarner Inc Earnings Call Transcript
Key Points
- BorgWarner Inc (BWA) reported a strong financial performance for 2025, with net sales reaching approximately $14.3 billion, a $200 million increase year over year.
- The company achieved a 23% increase in light vehicle eProduct sales, highlighting strong demand for hybrid and BEV products.
- BorgWarner Inc (BWA) expanded its adjusted operating margin by 60 basis points despite facing a 20 basis points net tariff headwind.
- The company generated over $1.2 billion in free cash flow, a 66% increase compared to the previous year, and returned over 50% of this to shareholders.
- BorgWarner Inc (BWA) secured a record number of new product awards across its foundational and eProduct portfolios, positioning the company for future growth.
- The Battery and Charging Systems segment experienced a decline, impacting overall organic sales growth.
- The company anticipates a sales decline in its battery business in 2026 due to lack of North American incentives and weaker European demand.
- BorgWarner Inc (BWA) expects its weighted end markets to be flat to down 3% for 2026, with a projected organic sales decline of 1.5% to 3.5%.
- The company faces challenges in its battery business, with sales expected to decline by 35% to 40% year over year.
- Despite strong financial performance, BorgWarner Inc (BWA) is not satisfied with its growth over market, particularly due to lower-than-expected volumes in EV programs.
Good morning. My name is Michael and I will be your conference specialist. At this time, I would like to welcome everyone to the BorgWarner 2025 fourth-quarter and full-year results conference call. (Operator Instructions)
I would now like to turn the call over to Patrick Nolan, Vice President of Investor Relations. Mr. Nolan, you may begin your conference.
Thank you, Michael. Good morning, everyone, and thank you for joining us today. We issued our earnings release earlier this morning. It's posted on our website, borgwarner.com, both on our home page and our Investor Relations home page. With regard to our upcoming Investor Relations calendar, we will be attending multiple investor conferences now in our next earnings release. Please see the Events section of our IR page for a full list.
Before we begin, I need to inform you that during this call, we may make forward-looking statements, which involve risks and uncertainties as detailed in our 10-K. Our actual results may
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