GTX · Garrett Motion Inc.

Garrett Motion Inc. delivered a strong Q1 2026 with net sales rising 12% to $985 million on a reported basis (6% constant currency) versus Q1 2025, fueled by share gains in passenger vehicles, robust commercial vehicle off-highway and industrial demand, new program launches, favorable product mix, tariff recoveries, and foreign currency tailwinds. Gross profit increased to $196 million (19.9% margin from 20.4%), pressured by lower productivity, pricing/inflation dynamics, and tariffs, but bolstered by volume leverage, FX benefits, reduced RD&E, and input cost deflation. SG&A dipped slightly to $58 million amid lower professional services and bad debt recovery, while other expense fell sharply due to prior-year refinancing fees. Interest expense declined to $27 million from reduced debt notional, and non-operating income jumped to $8 million on environmental resolutions and FX gains. Net income climbed to $95 million (9.6% margin), reflecting operational leverage. Adjusted EBIT expanded to $151 million (15.3% margin), driven by volumes, FX, lower RD&E, mix, and deflation, offset by productivity and pricing headwinds. Operating cash flow surged to $98 million, yielding $49 million adjusted free cash flow. Balance sheet remains solid with $772 million liquidity and $1,437 million debt. Management highlighted disciplined execution, $87 million share repurchases (remaining capacity $163 million), and a $0.08 dividend. New wins in light vehicle turbos, E-Powertrain, E-Cooling, and industrial applications underscore electrification strategy. Notably, Garrett raised its full-year 2026 outlook across key metrics, including net sales to $3.6-3.9 billion (from $3.6-3.8 billion prior), Adjusted EBIT to $520-600 million (from $520-570 million), signaling confidence amid expected light vehicle production decline and commercial vehicle growth.