PHIN · PHINIA Inc.

PHINIA Inc. delivered strong Q1 2026 results, with net sales rising 10.3% to $878 million, driven primarily by $29 million or 3.6% organic growth excluding foreign currency and the SEM acquisition, fueled by higher volumes in Asia and the Americas alongside tariff recoveries. Gross margin dipped slightly to 21.4% from 21.6%, but operating income improved to $69 million from $62 million, supported by overhead cost controls. Adjusted EBITDA expanded to $115 million with a 13.1% margin, up 20 basis points year-over-year, reflecting supplier savings and net tariff benefits. CEO Brady Ericson highlighted disciplined execution, with adjusted EPS surging over 37% to $1.29, aided by operational gains and lower share count from repurchases. The company returned $67 million to shareholders, including $56 million in buybacks and $11 million in dividends, underscoring confidence in cash generation. Balance sheet remains solid with $328 million in cash, $992 million total debt, and $480 million revolver capacity. Operating cash flow hit $53 million, up $13 million YoY, enabling record Q1 adjusted free cash flow of $42 million since independence. Strategic wins advanced diversification, including CNG fuel rails in India, jet fuel injectors for drones, and aftermarket expansions in Europe and Asia Pacific. Full-year guidance held steady at $3.52-3.72 billion in sales (1-7% growth), $485-525 million adjusted EBITDA, and $200-240 million adjusted FCF, with adjusted tax rate of 30-34%, positioning PHINIA for sustained profitability amid alternative fuel and electrification trends.