Lear Reports First Quarter 2026 Results; The Highest EPS Since 2021 And The Highest Adjusted EPS Since 2019
Rhea-AI Summary
Lear (NYSE: LEA) reported Q1 2026 results: $5.8B revenue, net income $172M, adjusted net income $200M, core operating earnings $297M, EPS $3.34 and adjusted EPS $3.87. Adjusted EPS rose 24% year-over-year. Free cash flow was $(27)M and operating cash flow was $98M. Lear repurchased $75M of shares and reaffirmed full-year 2026 guidance with sales of $23.21B–$24.01B and free cash flow $550M–$650M.
AI-generated analysis. Not financial advice.
Positive
- Revenue +5% to $5.8B in Q1 2026
- Adjusted EPS +24% YoY to $3.87
- Core operating earnings $297M (5.1% of sales)
- Repurchased $75M of common stock in Q1
- Reaffirmed full‑year guidance with Free Cash Flow $550M–$650M
Negative
- Free cash flow negative at $(27)M in Q1
- China vehicle production -10% weighed on regional volumes
- Restructuring costs ≈$175M included in full‑year outlook
News Market Reaction – LEA
On the day this news was published, LEA gained 4.15%, reflecting a moderate positive market reaction. Argus tracked a trough of -9.6% from its starting point during tracking. Our momentum scanner triggered 3 alerts that day, indicating moderate trading interest and price volatility. This price movement added approximately $256M to the company's valuation, bringing the market cap to $6.44B at that time.
Data tracked by StockTitan Argus on the day of publication.
Key Figures
Market Reality Check
Peers on Argus
LEA gained 2.66% with strong Q1 results while key peers like MOD (+6.63%), VC (+3.97%) and ALSN (+3.38%) also traded higher, but momentum scanners did not flag a coordinated sector move, suggesting the reaction was more stock-specific.
Previous Earnings Reports
| Date | Event | Sentiment | Move | Catalyst |
|---|---|---|---|---|
| Feb 04 | Q4 & FY25 earnings | Positive | +10.7% | Q4 revenue growth, fifth year of adjusted EPS gains and strong liquidity. |
| Oct 31 | Q3 2025 earnings | Positive | +1.1% | Revenue and cash flow improvement, share repurchases and raised free cash flow guidance. |
| Jul 25 | Q2 2025 earnings | Negative | -8.1% | Flat revenue with lower net income despite segment margin gains and restored guidance. |
| May 06 | Q1 2025 earnings | Negative | -2.5% | Revenue and EPS decline versus 2024, despite margin gains and new business wins. |
| Feb 06 | Q4 & FY24 earnings | Negative | +1.3% | Lower Q4 and full-year revenue and net income but strong capital return and liquidity. |
Earnings releases have generally seen price moves aligned with the tone of results, with only one recent divergence after mixed full-year 2024 numbers.
Over the last year, Lear’s earnings updates have highlighted steady revenue around $23.3B, consistent adjusted EPS growth to $12.80 in 2025, and large E-Systems and Seating awards. Quarterly reports often pair operational improvements and shareholder returns via buybacks and dividends. The current Q1 2026 release continues this pattern with higher EPS, stronger segment margins and reaffirmed 2026 guidance, building on the momentum from 2025’s record E-Systems awards and major seating conquest wins.
Historical Comparison
In the past five earnings releases, LEA’s average one-day move was 0.51%. Those reports often combined modest topline shifts with margin work and capital returns, a backdrop similar to this Q1 2026 update.
Earnings have evolved from mixed 2024 results to improving 2025 quarters with rising adjusted EPS, higher free cash flow guidance and growing E-Systems awards, now followed by Q1 2026’s highest EPS since 2021 and reaffirmed 2026 outlook.
Market Pulse Summary
This announcement highlighted Q1 2026 revenue of $5.8 billion, sharply higher net income of $172 million and adjusted EPS of $3.87, the best since 2019. Margins improved in both Seating and E-Systems, and management reaffirmed 2026 guidance, including free cash flow of $550–$650 million. Recent earnings history shows the company emphasizing margin discipline, cash generation and sizeable share repurchases, key areas for investors to monitor across future quarters.
Key Terms
core operating earnings financial
adjusted EBITDA financial
free cash flow financial
non-GAAP financial measures financial
AI-generated analysis. Not financial advice.
First Quarter 2026 Financial Highlights
- Revenue of
$5.8 billion 5% , compared to$5.6 billion - Net income of
$172 million $200 million $81 million $169 million - Core operating earnings of
$297 million 10% , compared to$270 million - Earnings per share of
$3.34 $3.87 $1.49 $3.12 - Adjusted earnings per share grew
24% year over year, reflecting higher earnings and the benefit of our share repurchase program - Net cash provided by (used in) operating activities of
$98 million $(27) million $(128) million $(232) million - Repurchased
$75 million $43 million - Cash and cash equivalents at quarter-end of
$882 million $2.9 billion
First Quarter 2026 Business Highlights
- Growing our core E-Systems products with key wins, including wire awards for a subset of harnesses for General Motors' full-size SUVs, with SAIC in
China launching in 2027 and with Geely and Dongfeng for new products launching in the second half of 2026; and electronics awards for a power distribution module with a North American automaker for their next generation electrical architecture on major platforms and a high-voltage power distribution module with Audi - Expanding our leadership position in Seating with new complete seat awards with Toyota in
China through a non-consolidated joint venture; ComfortFlexTM awards with Audi and BMW; and a ComfortMax SeatTM award with Geely
"Lear started 2026 strong in a dynamic operating environment, delivering the highest quarterly adjusted earnings per share since 2019 and improved year-over-year margins in both segments. Our differentiated capabilities continue to drive significant new business awards and accelerated growth with Chinese automakers increasing our backlog in both segments, building on the momentum from the largest Seating conquest win in our history secured at the end of last year" said Ray Scott, Lear's President and Chief Executive Officer. "Our targeted investments in automation and digital tools are supporting our long-term growth strategy and allowing us to launch key programs such as the seats for the GM full-size SUVs and pickup trucks in Orion with unprecedented speed. Our strong cash generation outlook enabled us to continue returning excess cash to shareholders by increasing the pace of share repurchases in the quarter, resulting in strong earnings per share growth while maintaining our dividend."
First Quarter Financial Results
(in millions, except per share amounts)
2026 | 2025 | ||
Reported | |||
Sales | $ 5,822.8 | $ 5,560.3 | |
Net income | $ 172.3 | $ 80.7 | |
Earnings per share | $ 3.34 | $ 1.49 | |
Adjusted(1) | |||
Core operating earnings | $ 297.3 | $ 270.4 | |
Adjusted net income | $ 199.5 | $ 169.3 | |
Adjusted earnings per share | $ 3.87 | $ 3.12 |
In the first quarter, global vehicle production was down
Sales in the first quarter were
Core operating earnings were
In the Seating segment, margins and adjusted margins increased to
Net income was
Earnings per share were
In the first quarter of 2026, net cash from operating activities was
(1)For more information regarding our non-GAAP financial measures, see "Non-GAAP Financial Information" below.
(2) The global and regional production changes are based on S&P Global estimates. The production change on a Lear sales-weighted basis is calculated using Lear's prior year regional sales mix and first quarter fiscal calendar. Management believes this provides a more meaningful comparison of the Company's global revenue growth relative to global vehicle production.
Share Repurchase Program
During the first quarter of 2026, Lear repurchased 630,804 shares of our common stock for a total of
Since initiating the share repurchase program in 2011, we have repurchased 62.8 million shares of our common stock for a total of
2026 Financial Outlook
We have maintained our financial outlook for 2026 across all metrics.
At the midpoint of our guidance range, we have assumed that global industry production will be approximately
Our outlook excludes any future impact of potential changes to tariffs or Company or industry-wide production disruptions.
Our 2026 financial outlook is summarized below:
Full Year 2026 Financial Outlook | ||
Net Sales | ||
Core Operating Earnings | ||
Adjusted EBITDA | ||
Restructuring Costs | ≈ | |
Operating Cash Flow | ||
Capital Spending | ≈ | |
Free Cash Flow |
The financial outlook is based on a full year average exchange rate of
Certain of the forward-looking financial measures above are provided on a non-GAAP basis. The Company does not provide a reconciliation of such forward-looking measures to the most directly comparable financial measures calculated and presented in accordance with GAAP because to do so would be potentially misleading and not practical given the difficulty of projecting event-driven transactional and other non-core operating items in any future period. The magnitude of these items, however, may be significant.
First Quarter 2026 Conference Call and Webcast Information
A conference call and webcast will be held to discuss Lear's first quarter 2026 financial results and related matters on May 1, 2026, at 9:00 a.m. EDT. The webcast link for the conference call will be available through Lear's investor relations webpage at ir.lear.com. In addition, the conference call can be accessed by dialing 1-877-883-0383 (domestic) or 1-412-902-6506 (international) with Conference I.D. 8201618. The webcast replay will be available two hours following the call.
Non-GAAP Financial Information
In addition to the results reported in accordance with accounting principles generally accepted in
Management believes the non-GAAP financial measures used in this press release are useful to both management and investors in their analysis of the Company's financial position and results of operations. In particular, management believes that core operating earnings, adjusted EBITDA, adjusted net income and adjusted earnings per share are useful measures in assessing the Company's financial performance by excluding certain items that are not indicative of the Company's core operating performance or that may obscure trends useful in evaluating the Company's continuing operating activities. Management also believes that these measures provide improved comparability between fiscal periods. Management believes that free cash flow is useful to both management and investors in their analysis of the Company's ability to service and repay its debt. Further, management uses these non-GAAP financial measures for planning and forecasting future periods.
Core operating earnings, adjusted EBITDA, adjusted net income, adjusted earnings per share and free cash flow should not be considered in isolation or as a substitute for net income attributable to Lear, diluted net income per share attributable to Lear, cash provided by (used in) operating activities or other income statement or cash flow statement data prepared in accordance with GAAP or as a measure of profitability or liquidity. In addition, the calculation of free cash flow does not reflect cash used to service debt and, therefore, does not reflect funds available for investment or other discretionary uses. Also, these non-GAAP financial measures, as determined and presented by the Company, may not be comparable to related or similarly titled measures reported by other companies. Set forth below are reconciliations of these non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding anticipated financial results and liquidity. The words "may," "designed to," "outlook," "believes," "should," "anticipates," "plans," "expects," "intends," "estimates," "forecasts", "targets" and similar expressions identify certain of these forward-looking statements. The Company also may provide forward-looking statements in oral statements or other written materials released to the public. All statements contained or incorporated in this press release or in any other public statements that address operating performance, events or developments that the Company expects or anticipates may occur in the future are forward-looking statements. Factors that could cause actual results to differ materially from these forward-looking statements are discussed in the Company's Annual Report on Form 10-K for the year ended December 31, 2025, and its other Securities and Exchange Commission filings. Future operating results will be based on various factors, including actual industry production volumes, the impact of, and our ability to mitigate the effects of,
Information in this press release relies on assumptions in the Company's core sales backlog. The Company's core sales backlog reflects anticipated net sales from formally awarded new programs less lost and discontinued programs and excludes the impact of non-core products winding down in our E-Systems business. The Company enters into contracts with its customers to provide production parts generally at the beginning of a vehicle's life cycle. Typically, these contracts do not provide for a specified quantity of production, and many of these contracts may be terminated by the Company's customers at any time. Therefore, these contracts do not represent firm orders. Further, the calculation of the core sales backlog does not reflect customer price reductions on existing or newly awarded programs. The core sales backlog may be impacted by various assumptions embedded in the calculation, including vehicle production levels on new programs, foreign exchange rates and the timing of major program launches.
The forward-looking statements in this press release are made as of the date hereof, and the Company does not assume any obligation to update, amend or clarify them to reflect events, new information or circumstances occurring after the date hereof.
About Lear Corporation
Lear Corporation (NYSE: LEA) is a global automotive leader in Seating and E-Systems. The company designs, manufactures, and delivers advanced technologies to the world's major automakers. Building on more than 100 years of heritage, Lear is the largest
Lear Corporation and Subsidiaries Condensed Consolidated Statements of Income
(Unaudited; in millions, except per share amounts) | ||||
Three Months Ended | ||||
April 4, | March 29, | |||
Net sales | $ 5,822.8 | $ 5,560.3 | ||
Cost of sales | 5,372.5 | 5,201.1 | ||
Selling, general and administrative expenses | 190.3 | 172.4 | ||
Amortization of intangible assets | 5.0 | 5.2 | ||
Interest expense | 25.6 | 25.8 | ||
Other expense, net | 12.7 | 20.4 | ||
Consolidated income before income taxes and equity in net income of affiliates | 216.7 | 135.4 | ||
Income taxes | 38.4 | 45.2 | ||
Equity in net income of affiliates | (14.4) | (12.3) | ||
Consolidated net income | 192.7 | 102.5 | ||
Net income attributable to noncontrolling interests | 20.4 | 21.8 | ||
Net income attributable to Lear | $ 172.3 | $ 80.7 | ||
Diluted net income per share attributable to Lear | $ 3.34 | $ 1.49 | ||
Weighted average number of diluted shares outstanding | 51.5 | 54.2 | ||
Lear Corporation and Subsidiaries Condensed Consolidated Balance Sheets
(In millions) | ||||
April 4, | December 31, | |||
(Unaudited) | (Audited) | |||
ASSETS | ||||
Current: | ||||
Cash and cash equivalents | $ 881.9 | $ 1,033.0 | ||
Accounts receivable | 4,174.4 | 3,902.8 | ||
Inventories | 1,750.7 | 1,693.2 | ||
Other | 1,447.0 | 1,034.0 | ||
8,254.0 | 7,663.0 | |||
Long-Term: | ||||
PP&E, net | 2,845.5 | 2,913.1 | ||
Goodwill | 1,775.8 | 1,777.8 | ||
Other | 2,578.3 | 2,489.2 | ||
7,199.6 | 7,180.1 | |||
Total Assets | $ 15,453.6 | $ 14,843.1 | ||
LIABILITIES AND EQUITY | ||||
Current: | ||||
Short-term borrowings | $ 28.3 | $ 27.9 | ||
Accounts payable and drafts | 3,780.2 | 3,416.5 | ||
Accrued liabilities | 2,403.5 | 2,219.0 | ||
Current portion of long-term debt | 3.8 | 3.7 | ||
6,215.8 | 5,667.1 | |||
Long-Term: | ||||
Long-term debt | 2,711.6 | 2,711.5 | ||
Other | 1,250.9 | 1,263.5 | ||
3,962.5 | 3,975.0 | |||
Equity | 5,275.3 | 5,201.0 | ||
Total Liabilities and Equity | $ 15,453.6 | $ 14,843.1 | ||
Lear Corporation and Subsidiaries Consolidated Supplemental Data
(Unaudited; in millions, except content per vehicle and per share amounts) | ||||
Three Months Ended | ||||
April 4, | March 29, | |||
Net Sales | ||||
$ 2,223.6 | $ 2,248.8 | |||
2,300.9 | 2,062.1 | |||
1,084.9 | 1,071.6 | |||
213.4 | 177.8 | |||
Total | $ 5,822.8 | $ 5,560.3 | ||
Content per Vehicle 1 | ||||
$ 582 | $ 607 | |||
$ 504 | $ 469 | |||
Free Cash Flow 2 | ||||
Net cash used in operating activities | $ 98.1 | $ (127.7) | ||
Capital expenditures | (124.6) | (104.0) | ||
Free cash flow | $ (26.5) | $ (231.7) | ||
Core Operating Earnings 2 | ||||
Net income attributable to Lear | $ 172.3 | $ 80.7 | ||
Interest expense | 25.6 | 25.8 | ||
Other expense, net | 12.7 | 20.4 | ||
Income taxes | 38.4 | 45.2 | ||
Equity in net income of affiliates | (14.4) | (12.3) | ||
Net income attributable to noncontrolling interests | 20.4 | 21.8 | ||
Restructuring costs and other special items - | ||||
Costs related to restructuring actions | 43.0 | 87.4 | ||
Acquisition costs | — | 0.1 | ||
Disposal costs | — | 0.6 | ||
Recoveries related to Fisker Inc. | — | (0.4) | ||
Impairments (recoveries) related to Russian operations, net | 0.2 | (1.4) | ||
Other | (0.9) | 2.5 | ||
Core operating earnings | $ 297.3 | $ 270.4 | ||
Lear Corporation and Subsidiaries Consolidated Supplemental Data (continued)
(Unaudited; in millions, except content per vehicle and per share amounts) | ||||
Three Months Ended | ||||
April 4, | March 29, | |||
Adjusted Net Income and Adjusted Earnings Per Share 2 | ||||
Net income attributable to Lear | $ 172.3 | $ 80.7 | ||
Restructuring costs and other special items - | ||||
Costs related to restructuring actions | 43.0 | 87.7 | ||
Acquisition costs | — | 0.1 | ||
Loss related to disposal of non-core business | 0.4 | 3.3 | ||
Disposal costs | — | 0.6 | ||
Recoveries related to Fisker Inc. | — | (0.4) | ||
Impairments (recoveries) related to Russian operations, net | 0.2 | (1.4) | ||
Foreign exchange losses due to foreign exchange rate volatility related to | 0.7 | — | ||
Other | 0.2 | 7.3 | ||
Tax impact of special items and other net tax adjustments 3 | (17.3) | (8.6) | ||
Adjusted net income | $ 199.5 | $ 169.3 | ||
Weighted average number of diluted shares outstanding | 51.5 | 54.2 | ||
Diluted net income per share available to Lear | $ 3.34 | $ 1.49 | ||
Adjusted earnings per share | $ 3.87 | $ 3.12 | ||
Diluted Shares Outstanding at End of Period 4 | 50,967,829 | 53,968,155 | ||
1 Content per Vehicle for 2025 has been updated to reflect actual production levels. | ||||
2 See "Non-GAAP Financial Information" included in this press release. | ||||
3 Represents the tax effect of restructuring costs and other special items, as well as several discrete tax items. The identification of these tax items is judgmental in nature, and their calculation is based on various assumptions and estimates. | ||||
4 Calculated using stock price at end of period. | ||||
Lear Corporation and Subsidiaries Segment Supplemental Data
(Unaudited; in millions, except margins) | ||||
Three Months Ended | ||||
April 4, | March 29, | |||
Adjusted Segment Earnings | ||||
Seating | ||||
Net sales | $ 4,404.4 | $ 4,151.1 | ||
Segment earnings | $ 277.4 | $ 215.7 | ||
Restructuring costs and other special items - | ||||
Costs related to restructuring actions | 26.8 | 64.5 | ||
Impairments (recoveries) related to Russian operations, net | 0.2 | (1.4) | ||
Other | 0.4 | 1.1 | ||
Adjusted segment earnings | $ 304.8 | $ 279.9 | ||
Segment margins | 6.3 % | 5.2 % | ||
Adjusted segment margins | 6.9 % | 6.7 % | ||
E-Systems | ||||
Net sales | $ 1,418.4 | $ 1,409.2 | ||
Segment earnings | $ 73.3 | $ 55.5 | ||
Restructuring and other special items - | ||||
Costs related to restructuring actions | 12.8 | 16.8 | ||
Recoveries related to Fisker Inc. | — | (0.4) | ||
Other | 0.4 | 1.9 | ||
Adjusted segment earnings | $ 86.5 | $ 73.8 | ||
Segment margins | 5.2 % | 3.9 % | ||
Adjusted segment margins | 6.1 % | 5.2 % | ||
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SOURCE Lear Corporation