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What were the key takeaways from PHINIA’s earnings call?

- **Revenue Record**: Q3 sales $908 million (+8.2% YoY), driven by SEM, FX, and Asian/American volume growth.
- **Profitability Boost**: Adjusted EBITDA $133 million (14.6% margin), new stand-alone high.
- **Strategic Wins**: Aerospace shipments, hybrid vehicle wins, and Chinese OEM contracts.
- **Shareholder Returns**: $41M returned via dividends/buybacks; $194M buyback capacity.
- **Guidance Update**: 2025 sales $3.42B, EBITDA $473M, free cash flow $190M.
- **SEM Integration**: Q4 SEM contribution $7M, targeting $50M annual run rate.
- **Aerospace Growth**: Initial shipments, with more programs expected in 2026.

**【CEO Summary Section】**
- **Record Q3 Revenue**: $908 million, up 8.2% YoY, driven by SEM acquisition, FX tailwinds, and volume growth in Asia and Americas.
- **Adjusted EBITDA**: $133 million (14.6% margin), a new stand-alone company record, supported by R&D savings and cost control.
- **Strategic Wins**: New business in aerospace (initial shipments), hybrid light commercial vehicles, and Chinese OEMs.
- **Capital Allocation**: Returned $41 million to shareholders via dividends and buybacks; $194 million remaining under repurchase authorization.
- **Balance Sheet Strength**: $349 million cash, $900 million liquidity, net leverage 1.4x.
- **2025 Guidance Update**: Sales midpoint $3.42 billion, EBITDA $473 million, free cash flow $190 million.

**【CFO Financial Commentary】**
- **Fuel Systems Segment**: $8 million SEM contribution, 13.4% revenue growth, 190bp margin expansion from supply chain savings.
- **Aftermarket Segment**: 15% margin, offset by unfavorable product mix and North American volume decline.
- **Free Cash Flow**: $104 million Q3, up from $60 million YoY.
- **Tax Rate**: 33-37% vs. prior 36-40%.
- **Restructuring Plan**: $35 million costs for ERP consolidation, targeting $25 million annual savings.

**【Q&A Highlights】**
- **Organic Growth Breakdown**: 5% YoY growth (pricing/tariffs, volumes, new products equally balanced).
- **SEM Performance**: Q4 expected $7 million vs. Q3 $8 million, due to CV market softness and seasonality.
- **Aerospace Expansion**: Initial shipments with key customer; expect additional programs in 2026.
- **Ford Recall Impact**: No cash impact or warranty adjustments.
- **Restructuring Timeline**: Multiyear program (2026-2028) for ERP consolidation and efficiency gains.

PHINIA Inc. (PHIN) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

PHIN

PHIN fundamentals

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