0001968915-26-000070
SEC filingPHINIA delivered a strong start to fiscal 2026, with double-digit revenue growth and a 42% surge in net income, driven by cost controls and tariff recoveries.
Revenue for the first quarter of fiscal 2026 was $878.0 million, a 10.3% increase compared to $796.0 million in the prior-year period. The growth was primarily attributable to the acquisition of SEM, tariff pass-throughs, and favorable foreign exchange impacts. The company continues to benefit from its strategic acquisitions and pricing actions to mitigate tariff headwinds.
Gross profit increased 9.3% to $188.0 million, resulting in a gross margin of 21.4%. Operating income rose 11.3% to $69.0 million, with operating margin improving to 7.9%. Net income surged 42.3% to $37.0 million, driven by higher operating income and lower interest expenses. Diluted earnings per share increased 52.4% to $0.96. Segment Adjusted Operating margin experienced mixed performance: one segment saw an increase due to cost control measures and tariff recoveries, while another segment faced a decrease due to unfavorable product mix in Europe and Asia, partially offset by cost controls and supplier savings.
Management expects continued economic and geopolitical uncertainty to impact light vehicle volumes, which are anticipated to decline by mid-single percentages in key markets. The company is focused on cost control measures, supplier savings, and tariff recoveries to mitigate these headwinds. The SEM acquisition enhances the company's product portfolio and strategy, enabling exploration of adjacent market opportunities to increase Fuel Systems sales globally.