What factors contributed to THRM's earnings surprises in 2024?

Gentherm Inc (THRM) experienced an earnings surprise in the fiscal quarter ending December 31, 2024, with a reported EPS of $0.49, missing the estimate of $0.66. The company's earnings report for the same period revealed several factors that contributed to this surprise:

1. **Revenue Decline**: Quarterly revenue fell to $352.9 million, below the estimated $360.29 million, reflecting a 3.8% decrease year-over-year. This decline was primarily driven by a 4.3% decrease in automotive revenues.
2. **Cost Impacts**: The company faced challenges related to cost impacts, which affected its gross margin. The gross margin decreased to 24.4% in the fourth quarter from 26.2% in the prior-year period.
3. **Strategic Realignment**: Gentherm is planning to reduce its operational footprint by 30% while maintaining necessary capacity to enhance long-term profitability.

In summary, Gentherm's earnings surprise in 2024 was primarily due to revenue decline and cost impacts. The company's strategic realignment aims to improve margins and cash flow generation in the long term.