Autoliv (ALV) Q4 2025 Earnings Call Transcript

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Friday, January 30, 2026 astatine 8 a.m. ET

• President and Chief Executive Officer — Mikael Bratt

• Chief Financial Officer — Fredrik Westin

Mikael Bratt: Thank you, Anders. Looking connected the adjacent slide. I americium precise pleased to study different large 4th with beardown improvement successful sales, profitability, currency travel and equilibrium sheet. These achievements bespeak the show of the full Autoliv squad and the extent of our lawsuit partnerships and our dedication to ongoing structural outgo savings. We achieved grounds precocious income for some the 4th and the afloat twelvemonth supported chiefly by beardown maturation successful India and with Chinese OEMs. Sales to rapidly expanding Chinese OEMs surged astir 40% successful the quarter, reinforcing our presumption successful the industry's astir dynamic markets. India, again, delivered exceptional growth, representing astir fractional of our planetary integrated growth.

Looking ahead, we expect to proceed to importantly outperform airy conveyance accumulation successful some China and India successful 2026. As we person guided for, adjusted operating income declined somewhat successful the quarter, chiefly owed to little out-of-period compensation and little lawsuit RD&E reimbursement. We recovered adjacent to 100% of tariff costs successful the 4th quarter. We delivered grounds operating and escaped operating currency travel for some the 4th and for the afloat year. In 2025, we generated $734 cardinal successful escaped operating currency flow, an summation of implicit $230 million, driven by higher profitability and disciplined superior management. It is besides important to enactment that we delivered grounds net per stock for some the 4th and the afloat year.

During the quarter, we returned $216 cardinal to shareholders portion reducing our indebtedness leverage ratio to 1.1x, reinforcing my assurance successful our quality to proceed delivering charismatic shareholder returns. We besides announced that Autoliv and Tensor person developed the archetypal foldable steering instrumentality for the Tensor's Robocar, targeted for measurement accumulation successful precocious 2026. This innovation enhances information and plan flexibility for autonomous vehicles and marks an important strategical measurement successful expanding our relation successful the emerging autonomous conveyance ecosystem. Looking connected the adjacent slide. Fourth 4th income accrued by 8% year-over-year, driven by beardown outperformance comparative to LVP, on with favorable currency effects and tariff-related compensations.

This maturation was partially offset by an unfavorable determination and marketplace airy conveyance accumulation mix. The adjusted operating income for Q4 decreased by 4% to $337 million, compared to an exceptionally beardown 4th fourth past year. The adjusted operating borderline was 12%, 140 ground points little than successful the aforesaid 4th past year. Operating currency travel was $544 million, an summation of $124 cardinal oregon 30% compared to past year. Looking present connected the adjacent slide. We proceed to present broad-based improvements with peculiarly beardown advancement successful nonstop costs. Our affirmative nonstop labour productivity inclination continues arsenic we trim our nonstop accumulation unit by astir $700 million.