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Borgwarner Inc. — q4 2025 earnings call presentation (company IR deck)
Borgwarner Inc. (BWA) · 24 slides · Filed Oct 29, 2026
Every slide of this earnings presentation, with the text as published. Open the original deck ↗ · All BWA deck slides
Slide 1 — Earnings Call
Q4 & FY 2025 Earnings Call Presentation February 11, 2026 Update pic
Slide 2 — Forward-Looking Statements
2 Forward-Looking Statements This presentation may contain forward-looking statements as contemplated by the 1995 Private Securities Litigation Reform Act that are based on management’s current outlook, expectations, estimates and projections. Words such as “anticipates,” “believes,” “continues,” “could,” “designed,” “effect,” “estimates,” “evaluates,” “expects,” “forecasts,” “goal,” “guidance,” “initiative,” “intends,” “may,” “outlook,” “plans,” “potential,” “predicts,” “project,” “pursue,” “seek,” “should,” “target,” “when,” “will,” “would,” and variations of such words and similar expressions are intended to identify such forward-looking statements. Further, all statements, other than statements of historical fact, contained or incorporated by reference in this presentation that we expect or anticipate will or may occur in the future regarding our financial position, including our 2026 outlook, market, production and earnings expectations, our business strategy and measures to implement that strategy, including changes to operations, competitive strengths, goals, expansion and profitable growth of our business and operations, plans, references to future success, including the success of the turbine generator system and our other new business awards, and other such matters, are forward-looking statements. Accounting estimates, such as those described under the heading “Critical Accounting Policies and Estimates” in Item 7 of our most recently filed Annual Report on Form 10-K (“Form 10-K”), are inherently forward-looking. All forward-looking statements are based on assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate under the circumstances. Forward-looking statements are not guarantees of performance, and the Company’s actual results may differ materially from those expressed, projected or implied in or by the forward-looking statements. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this presentation. Forward-looking statements are subject to risks and uncertainties, many of which are difficult to predict and generally beyond our control, that could cause actual results to differ materially from those expressed, projected or implied in or by the forward-looking statements. These risks and uncertainties, among others, include: supply disruptions impacting us or our customers, commodity availability and pricing, and an inability to achieve expected levels of recoverability in commercial negotiations with customers concerning these costs; competitive challenges from existing and new competitors, including original equipment manufacturer (“OEM”) customers; the challenges associated with rapidly changing technologies, including artificial intelligence, and our ability to innovate in response; potential delays and other challenges associated with launching a new product, such as the turbine generator system, as it involves a new industry for the company; the difficulty in forecasting demand for electric vehicles and our electric vehicles revenue growth; potential future changes in laws and regulations, including, by way of example, taxes and tariffs, in the countries in which we operate; potential disruptions in the global economy caused by wars or other geopolitical conflicts; the ability to identify targets and consummate acquisitions on acceptable terms; failure to realize the expected benefits of acquisitions on a timely basis; the possibility that our 2023 tax-free spin-off of our former Fuel Systems and Aftermarket segments into a separate publicly traded company will not achieve its intended benefits; the failure to promptly and effectively integrate acquired businesses; the potential for unknown or inestimable liabilities relating to the acquired businesses; impacts of our exit of our charging business; our dependence on automotive and truck production, which is highly cyclical and subject to disruptions; our reliance on major OEM customers; impacts of any future strikes involving any of our OEM customers and any actions such OEM customers take in response; fluctuations in interest rates and foreign currency exchange rates; our dependence on information systems; the uncertainty of the global economic environment; the uncertainty surrounding global trade policies including tariffs and export restrictions, and their impacts on the Company, its customers and its suppliers; the outcome of existing or any future legal proceedings, including litigation with respect to various claims, or governmental investigations, including related litigation; impacts from any potential future acquisition or disposition transactions; and the other risks discussed in reports that we file with the Securities and Exchange Commission, including in Item 1A, “Risk Factors” in our most recently filed Annual Report on Form 10-K and/or Quarterly Report on Form 10-Q. We do not undertake any obligation to update or announce publicly any updates to or revisions to any of the forward-looking statements in this presentation to reflect any change in our expectations or any change in events, conditions, circumstances, or assumptions underlying the statements.
Slide 3 — Non-GAAP Financial Measures
3 Non-GAAP Financial Measures This presentation contains certain information about BorgWarner’s financial results that is not presented in accordance with U.S. GAAP. Such non-GAAP financial measures are reconciled to their closest U.S. GAAP financial measures in the Appendix. The provision of these comparable U.S. GAAP financial measures in the context of guidance for 2026 is not intended to indicate that BorgWarner is explicitly or implicitly providing projections on those U.S. GAAP financial measures, and actual results for such measures are likely to vary from those presented. The reconciliations include all information reasonably available to the company at the date of this presentation and the adjustments that management can reasonably predict. Management believes that these non-GAAP financial measures are useful to management, investors, and banking institutions in their analyses of the Company's business and operating performance. Management also uses this information for operational planning and decision-making purposes. Non-GAAP financial measures are not and should not be considered a substitute for any U.S. GAAP measure. Additionally, because not all companies use identical calculations, the non-GAAP financial measures as presented by BorgWarner may not be comparable to similarly titled measures reported by other companies.
Slide 4 — Agenda
4 Agenda ►Joe Fadool Chief Executive Officer ►Craig Aaron Chief Financial Officer ►Q&A
Slide 5 — Record Awards Support Future Profitable Growth
5 Significant Adj. Margin, Adj. EPS & Free Cash Flow Expansion; Record Awards Support Future Profitable Growth $14,086 $14,316 FY 2024 FY 2025 $4.32 $4.91 FY 2024 FY 2025 $729 $1,208 FY 2024 FY 2025 ▪YOY Light vehicle eProduct growth of ~23% ▪Achieved significant adj. margin, adj. EPS and free cash flow expansion ▪Secured record number of light vehicle awards across Foundational and eProduct portfolios ▪Signed Supply Agreement for power generation solution for the data center market and other microgrid applications ▪Believed to be well positioned to expand earnings power in 2026 and beyond Net Sales Free Cash Flow* Adj. EPS* *Organic sales, adj. operating margin, adj. EPS and free cash flow on this slide are non-US-GAAP measures. See reconciliation to US GAAP in Appendix. Organic Sales* Increase of ~0.5% 10.1% Adj. Op Margin* 10.7% Adj. Op Margin* $ in millions, except EPS Adj. EPS* Increase of ~14% FCF* Increase of ~66%
Slide 6 — Awards Across Technology-Focused Portfolio
6 Awards Across Technology-Focused Portfolio Integrated Drive Modules (iDM) and Generator Modules with Dual Inverters ▪North American OEM award for range extended electric vehicle trucks and large- frame SUVs ▪Production expected to begin in 2029 Integrated Drive Modules (iDM) ▪Award with a premium European OEM supporting a hybrid range extended powertrain architecture ▪Production expected to begin in 2029 Variable Turbine Geometry (VTG) Turbochargers ▪Conquest hybrid award with a major European OEM for the North American market ▪Production expected to begin in 2028 Electric Cross Differentials (eXD) ▪Award with a leading Chinese OEM used on 48V electrical and electronic architectures Battery Management Systems (BMS) ▪Award with a global OEM supporting additional B-segment and C-segment passenger cars and light commercial vehicles for both BEV and PHEV vehicles ▪Production expected to begin in 2029
Slide 7 — Agreement for Power Generation Solutions
7 Strategically Enters Data Center Market with Supply Agreement for Power Generation Solutions ▪Product: Modular turbine generator system for AI driven data center market and other microgrid applications ▪Background/Rationale: ▪Signed agreement with TurboCell (subsidiary of Endeavour) to support growing power generation demand ▪Endeavour provides turnkey facility solutions to Data Center and Micro Grid customers ▪Endeavour has 25 years of experience in the data center market and is operating multiple facilities (US and Europe) ▪Expected 2027 Sales: More than $300 million TurboCell leverages BorgWarner’s automotive core competencies to provide a competitive data center power solution
Slide 8 — Turbine Generator System Provides Significant
Multi-stage Turbine System 8 Turbine Generator System Provides Significant Advantages to Existing Power Generation Solutions Intercooler Combustor & Recuperator Cooling Fan Generator ▪Power/Modular Flexibility: continuous (bridging power) or backup power ▪Fuel Flexibility: natural gas, propane, diesel and hydrogen ▪Emissions Regulations: lower than traditional diesel solution ▪Automotive Scale: ▪~65% of the content manufactured by BorgWarner / ~35% designed and purchased components ▪Utilizing automotive and supply base scale to provide value Product Advantages Turbine generator system is a lower emission solution that provides power, fuel and load flexibility Power Electronics Adv. Software Controls
Slide 9 — Q4 2025 Net Sales Walk
9 Q4 2025 Net Sales Walk $3,439 $3,572 $104 $29 Q4 2024 net sales FX Organic net sales change* Q4 2025 net sales $ in millions ▪ Organic sales* up ~0.8%, or up ~1.5% versus our weighted market ▪North America – Outgrowth supported by strong turbocharger sales as well as tariff and other customer recoveries ▪China – Modestly below market due to a decline in Foundational products ▪Europe – Modestly below market due to a decline in Foundational thermal products *Organic net sales change on this slide is a non-US-GAAP measure. See reconciliation to US GAAP in Appendix.
Slide 10 — Q4 2025 Financial Results & Adj. Operating Income
10 Q4 2025 Financial Results & Adj. Operating Income *Adj. operating income, adj. operating margin, adj. diluted EPS and free cash flow on this slide are non-US-GAAP measures. See reconciliation to US GAAP in Appendix. $352 $427 $8 $11 $56 Q4 2024 adj. operating income* FX Net tariff impact Organic change, productivity, cost controls & restructuring Q4 2025 adj. operating income* $ in millions ($ in millions, except per share amounts) Non-GAAP Financial Information (Continuing Operations) Three months ended December 31, 2025 2024 Net sales $3,572 $3,439 Adj. operating income* Adj. operating margin* $427 12.0% $352 10.2% Adj. diluted EPS* $1.35 $1.01 Free cash flow* $470 $539
Slide 11 — 2026 Outlook and Other Items
11 2026 Outlook and Other Items Full-year Net Sales Outlook ($M) Market & Earnings Outlook $14,316 $14,000 $200 $(306) $14,300 $(210) 2025 net sales FX Battery Sales Organic net sales change ex. battery 2026 net sales $(6) 10.7% to 10.9% Adj. Operating Margin* 10.7% Adj. Operating Margin* $ in millions, except EPS 2025 Actual 2026 Outlook Organic growth* 0.5% (3.5%) to (1.5%) Adj. operating margin* 10.7% 10.7% to 10.9% Adj. diluted EPS* $4.91 $5.00 to $5.20 Free cash flow* $1,208M $900M to $1,100M *Organic growth, adj. operating margin, adj. diluted EPS and free cash flow on this slide are non-US GAAP measures. See reconciliation to US GAAP in Appendix. Note: FX rate assumes $1.17 for Euro.
Slide 12 — Share Repurchase History
12 Share Repurchase History 240.2 234.6 230.2 219.1 208.7 200 205 210 215 220 225 230 235 240 245 2021 2022 2023 2024 2025 millions of shares 2025: $508M Outstanding Dilutive Shares $1.3B in share repurchases over the last four years; $600M authorization remains available to support additional value creation 2021: No Repurchases Current Authorization 2022: $240M 2023: $177M 2024: $400M Note: Repurchase dollars excludes excise taxes and commissions $1B $400M $600M 2025 Authorization Q3/Q4 2025 Repurchases 2025 Authorization Remaining
Slide 13 — THANK YOU
February 11, 2026 Q4 & FY 2025 Earnings Call Presentation THANK YOU
Slide 14 — APPENDIX
14 APPENDIX
Slide 15 — 2026 Light Vehicle Market Expectations
15 2026 Light Vehicle Market Expectations 15.3 17.0 32.9 92.9 BorgWarner Global Market FY’25 Actual FY’26 Est. FY’25 Actual FY’26 Est. FY’25 Actual FY’26 Est. FY’25 Actual FY’26 Est. North America China Europe 90.8 to 93.1 YOY (2%) to 0% 14.5 to 15.2 YOY (5%) to (1%) 31.7 to 32.6 YOY (4%) to (1%) 16.6 to 17.1 YOY (2%) to 0.5% Note: Actual and estimated volumes are BorgWarner market assumptions. LV Units in millions BorgWarner Estimated LV Weighted Market Down 3% to 0%
Slide 16 — 2026 Planning Assumptions
16 2026 Planning Assumptions ▪CapEx $600 to $700 million ▪Adjusted tax rate for ongoing operations ~23%
Slide 17 — Fourth Quarter & Full Year Reconciliation to US GAAP
17 Fourth Quarter & Full Year Reconciliation to US GAAP Adjusted Operating Income and Operating Margin The Company defines adjusted operating income as operating income adjusted to exclude the impact of restructuring expense, merger, acquisition and divestiture expense, intangible asset amortization expense, other net expenses, discontinued operations and other gains and losses not reflective of the Company’s ongoing operations. Adjusted operating margin is defined as adjusted operating income divided by net sales.
Slide 18 — Fourth Quarter & Full Year Reconciliation to US GAAP
18 Fourth Quarter & Full Year Reconciliation to US GAAP Adjusted Earnings Per Diluted Share The Company defines adjusted earnings per diluted share as earnings per diluted share adjusted to eliminate the impact of restructuring expense, merger, acquisition and divestiture expense, other net expenses, discontinued operations and other gains and losses not reflective of the Company’s ongoing operations and related tax effects. The impact of intangible asset amortization expense continues to be included in adjusted earnings per share.
Slide 19 — Fourth Quarter Organic Net Sales Change
19 Fourth Quarter Organic Net Sales Change Organic Net Sales Change The Company defines organic net sales changes as net sales change year-over-year excluding the estimated impact of foreign exchange (FX) and net mergers, acquisitions and divestitures.
Slide 20 — Full Year 2026 Adj. Operating Income and Adj.
20 Full Year 2026 Adj. Operating Income and Adj. Operating Margin Guidance Reconciliation to US GAAP Adjusted Operating Income and Operating Margin The Company defines adjusted operating income as operating income adjusted to exclude the impact of restructuring expense, merger, acquisition and divestiture expense, intangible asset amortization expense, other net expenses, discontinued operations and other gains and losses not reflective of the Company’s ongoing operations. Adjusted operating margin is defined as adjusted operating income divided by net sales.
Slide 21 — Full Year 2026 Adj. Earnings per Diluted Share
21 Full Year 2026 Adj. Earnings per Diluted Share Guidance Reconciliation to US GAAP Adjusted Earnings Per Diluted Share The Company defines adjusted earnings per diluted share as earnings per diluted share adjusted to eliminate the impact of restructuring expense, merger, acquisition and divestiture expense, other net expenses, discontinued operations and other gains and losses not reflective of the Company’s ongoing operations and related tax effects. The impact of intangible asset amortization expense continues to be included in adjusted earnings per share.
Slide 22 — Full Year 2026 Estimated Organic Net Sales Change
22 Full Year 2026 Estimated Organic Net Sales Change Guidance and Outgrowth Reconciliation Organic Net Sales Change The Company defines organic net sales changes as net sales change year-over-year excluding the estimated impact of foreign exchange (FX) and net mergers, acquisitions and divestitures. $ in millions FY 2025 Net Sales FX Battery Sales Change Organic Net Sales Change FY 2026 Net Sales Organic Net Sales Change Excluding Battery % Organic Net Sales Change Including Battery % BWA LV/CV Weighted Market Low $ 14,316 $ 200 $ (210) $ (306) $ 14,000 -2.1% -3.6% -3.0% High $ 14,316 $ 200 $ (210) $ (6) $ 14,300 0.0% -1.5% 0.0%
Slide 23 — Q4 & FY 2025, Q4 & FY 2024 & FY 2026
23 Q4 & FY 2025, Q4 & FY 2024 & FY 2026 Free Cash Flow Reconciliations to US GAAP The Company defines free cash flow as net cash provided by operating activities minus capital expenditures, net of customer advances related to capital expenditures. The Company believes this measure is useful to both management and investors in evaluating the Company’s ability to service and repay its debt.
Slide 24 — Key Definitions
The terms below are commonly used by management and investors in assessing ongoing financial performance: Organic Net Sales Change The Company defines organic net sales changes as net sales change year over year excluding the estimated impact of foreign exchange (FX) and net mergers, acquisitions and divestitures. Market Light vehicle production weighted for BorgWarner’s geographic exposure as estimated by BorgWarner. Outgrowth “Organic Net Sales Change” vs. year-over-year change in “Market”. 24 Key Definitions