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- **Cost Savings Acceleration**: $310 million target on track, with $73 million realized in Q3 and $235 million annualized run rate.
- **Margin Expansion**: 10%+ EBITDA margin achievable in 2026, driven by ICE vehicle growth and operational efficiency.
- **EV Program Challenges**: $10 million Q3 charges from cancellations, expected recovery in Q4.
- **Free Cash Flow Strength**: $101 million Q3 free cash flow, up $109 million YoY, with $275 million 2025 target.

**【CEO Summary Section】**
- **Business Performance and Restructuring**: CEO highlights improving business performance with $310 million cost savings on track, including $73 million realized in Q3. Restructuring initiatives are reducing headwinds, with minimal tariff impact in Q3 and expected recovery of $150 million in 2025. EV program cancellations caused $10 million charges in Q3, expected to recover in Q4.
- **Market Dynamics**: Light Vehicle demand stable, Commercial Vehicle (CV) North America and Brazil volumes soft. Off-Highway business sale nearing completion, with European regulatory approvals pending.
- **Margin Outlook**: Confident in achieving 10% to 10.5% EBITDA margin in 2026, driven by cost savings, operational efficiency, and ICE vehicle growth. Backlog includes $300 million in new programs, 70% ICE, with EV share declining.

**【CFO Financial Commentary】**
- **Q3 Financials**: Sales $1.917 billion (+1% YoY), Adjusted EBITDA $162 million (+$51 million YoY), margin 8.5% (up 260bps). Free cash flow $101 million, up $109 million YoY due to profitability and working capital improvements.
- **Guidance Updates**: Full year 2025 adjusted EBITDA raised $15 million to $590 million midpoint. 2026 targets: 10%+ EBITDA margin, $275 million free cash flow. Stranded costs reduced to $30-$40 million in 2026 post-Off-Highway sale.
- **Key Drivers**: Cost savings ($235 million annualized), tariff recovery ($150 million sales, $20 million profit headwind), and currency benefits ($25 million sales).

Dana Incorporated (DAN) Q3 2025 Earnings Call Transcript

- **$2.4B Off-Highway Sale Proceeds**: Returning $600M to shareholders, targeting 25% share count reduction to 110M shares.
- **Cost Savings Acceleration**: $310M annual run rate (up from $300M), with $110M delivered YTD.
- **2026 Margin Target**: 10-10.5% achievable via cost savings, tariff recovery, and new business wins (e.g., Ford Super Duty).
- **Free Cash Flow Growth**: 2025 guidance $275M (4% of sales), targeting 4%+ in 2026.
- **Undervaluation**: Shares trading below intrinsic value, with buybacks and potential dividend to unlock value.

**【CEO Summary Section】**
- Announced sale of Off-Highway business to Allison for $2.7B, with $2.4B net proceeds expected by Q4 2025.
- Raised capital return to shareholders to $600M (from $550M), targeting 25% YoY share count reduction to 110M shares.
- Cost reduction initiatives increased to $310M annual run rate (from $300M), with $60M delivered in Q2 and $110M YTD.
- 2026 margin target set at 10-10.5%, driven by cost savings, tariff recoveries, and new business backlog.
- Highlighted undervaluation, with shares trading below intrinsic value based on 2026 margin guidance.

**【CFO Financial Commentary】**
- Q2 2025: Continuing operations sales $1.94B (down 5.5% YoY), Adjusted EBITDA $145M (7.5% margin, +210bps YoY).
- Full year 2025 guidance: Continuing ops sales $7.4B, Adjusted EBITDA $575M, Free Cash Flow $275M (up $50M from prior guidance).
- Tariff impact: 80bps headwind in Q2, expecting 80%+ recovery for full year.
- Stranded costs: $60M in Q2 (vs. $35-40M prior estimate), expected to reduce by $40M+ in 2026.
- Capital allocation: 1) Share buybacks ($600M+ in 2025), 2) Debt reduction, 3) Selective growth investments.

**【Q&A Key Highlights】**
- **2026 Margin Target**: 10-10.5% achievable through cost savings ($310M), tariff recovery, and new business (e.g., Ford Super Duty, JLR programs).
- **Cost Reduction Opportunities**: $310M target is 'low-hanging fruit'; longer-term savings from plant efficiency and stranded cost elimination ($40M+ in 2026).
- **End Market Trends**: Light Vehicle stable, (Super Duty, Wrangler), Commercial Vehicle soft in North America (Class 8 orders down 50%), offset by South America/Europe growth.
- **Free Cash Flow**: 2025 guidance $275M (4% of sales), targeting 4%+ in 2026 with improved working capital and lower interest costs.
- **Tariff Mitigation**: 80%+ recovery expected for 2025, with lagged impacts in Q2 resolved in H2.
- **Share Buybacks**: Undervaluation (sub-16x EV/EBITDA) justifies aggressive buybacks, with $600M+ in 2025 and potential special dividend.

Dana Incorporated (DAN) Q2 2025 Earnings Conference Call Transcript

- **Cost Savings Triumph**: Accelerated $50 million of $300M cost reduction, with $41M realized in Q1. Full-year savings now $225M vs. prior $175M.
- **Tariff Resilience**: $6M Q1 tariff headwind to be fully offset by customer recoveries in 2025. Steel/aluminum tariffs covered by existing contracts.
- **Cash Flow Strength**: Q1 free cash flow improved $67M YoY; 2025 guidance of $225M reflects $90M EBITDA growth and $50M capex reduction.
- **Debt Reduction Focus**: Target 1x-2x leverage through Off-Highway sale proceeds and non-core asset sales ($50M+ in H2 2025).
- **EV Strategy Shift**: Reduced R&D on next-gen EV products; new programs require customer-funded engineering.


**【CEO Summary Section】**
- **Revenue Performance**: Q1 2025 revenue was $2.4 billion, down $383 million year-over-year due to lower demand across all end markets. Adjusted EBITDA was $188 million (8% margin), slightly lower than last year despite cost savings.
- **Cost Savings Acceleration**: Accelerated $50 million of the $300 million cost reduction program, with $41 million realized in Q1. Full-year savings now expected to reach $225 million, up from $175 million.
- **Tariff Impact**: $6 million tariff headwind in Q1, with recoveries expected to offset tariffs in 2025. Steel and aluminum tariffs are expected to be fully recovered through existing mechanisms.
- **Free Cash Flow**: Q1 free cash flow use of $101 million, an improvement of $67 million year-over-year. Full-year 2025 free cash flow guidance remains $225 million.
- **Off-Highway Divestiture**: Process ongoing with multiple bidders; expected to close late in Q2. Proceeds from non-core asset sales ($50 million in Q2, $50 million+ in H2) will support deleveraging.

**【CFO Financial Commentary】**
- **Net Income**: $25 million (vs. $3 million last year), driven by lower tax expenses and cost savings.
- **Sales Drivers**: $345 million volume/mix decline offset by $27 million commercial actions and $41 million cost savings. Tariffs and FX translation reduced sales by $59 million.
- **Guidance**: Full-year 2025 sales above midpoint of range, adjusted EBITDA $975 million (10% margin), and EPS $1.40. Tariffs and FX translation expected to provide top-line tailwinds.

**【Q&A Highlights】**
- **Tariff Recovery**: 100% recovery expected, with lagged cash flow impact. Key customers have approved claims, with checks pending.
- **EV Strategy**: Reduced R&D spend on next-gen EV products due to market slowdown. Focus on risk-sharing with customers for new programs.
- **Debt Reduction**: Target leverage of 1x-2x through cycle. Proceeds from Off-Highway sale and asset sales will drive debt paydown.
- **Off-Highway Outlook**: Pre-buy activity in Q2, with green shoots in non-North American markets. No material volume impact to date.


Dana (DAN)-30 Apr 25-2025 Q1 Earnings call transcript

- **2024 Performance**: EBITDA up $40M to $885M despite $271M sales decline, driven by $300M cost reduction program.
- **2025 Outlook**: $9.75B sales (-5% YoY), $975M EBITDA (+10%), targeting 10% margin with $225M free cash flow.
- **Divestiture Progress**: Off-highway sale expected Q2 2025, enabling 1x leverage and capital return.
- **Tax Normalization**: Post-sale valuation allowance relief to boost EPS visibility.
- **Tariff Mitigation**: Full customer pass-through with indexed recovery covering 75% of costs.

**【CEO Summary Section】**
- Full year 2024 sales declined $271 million due to EV and off-highway market weakness, but adjusted EBITDA rose $40 million to $885 million, driven by cost savings and operational efficiency.
- 2025 guidance includes $9.75 billion in sales (down $500 million YoY) and $975 million in adjusted EBITDA (up $90 million YoY), targeting 10% margin by year-end.
- Off-highway divestiture expected to close by end-2025, with $300 million cost reduction program fully implemented by 2026.
- 2025 free cash flow projected to triple to $225 million, supporting 1x net leverage target.

**【CFO Financial Commentary】**
- Q4 2024 adjusted EBITDA of $186 million (8% margin) vs. $164 million (6.3% margin) in Q4 2023, reflecting $10 million in cost savings.
- Full year 2024 free cash flow improved to $70 million (vs. negative in 2023), driven by higher EBITDA and lower capital spending.
- 2025 guidance includes $175 million in cost savings, with $35-40 million expected in Q1 2025.
- Tax rate volatility due to U.S. valuation allowance, but normalization expected post-off-highway sale.

**【Q&A Key Takeaways】**
- Off-highway divestiture: Strong bidder interest, transaction expected in Q2 2025 with proceeds to reduce debt and buyback shares.
- EV strategy: Shift to selective partnerships reduces CapEx intensity, with $15-20 million annual savings from Power Technologies consolidation.
- Tariffs: Customers notified of full pass-through intent, indexed cost recovery mechanisms mitigate 75% of impact.
- Backlog: 80% of $650 million backlog in light vehicle driveline, minimal CV backlog due to catalog nature.
- Margins: 10%+ new Dana margin target achievable by 2026 with full cost savings realization.

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