APTV

It has been about a month since the last earnings report for Aptiv PLC (APTV). Shares have lost about 4.2% in that time frame, underperforming the S&P 500. But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is APTIV PLC due for a breakout? Well, first let's take a quick look at its latest earnings report in order to get a better handle on the recent catalysts for Aptiv PLC before we dive into how investors and analysts have reacted as of late. Aptiv PLC reported mixed second-quarter 2026 results, with earnings beating the Zacks Consensus Estimate but revenues missing the same. APTV’s adjusted earnings of $1.63 per share topped the Zacks Consensus Estimate of $1.42 by 14.8% and increased 24.4% from the year-ago quarter, aided by stronger operating profitability, lower interest expense and a reduced share count. Revenues of $3.27 billion missed the consensus mark of $3.32 billion by 1.4% but rose 2.3% year over year. Adjusted revenue growth was 2%, while non-automotive revenues increased 12%. The company reported results excluding its Electrical Distribution (EDS) segment, which completed its spin-off into a new publicly traded company, Versigent, on April 1, 2026. North American adjusted revenues advanced 10% despite flat regional vehicle production. Asia-Pacific revenues grew 6%, including a 5% increase in China, even as Chinese vehicle production declined 3%. Europe remained a headwind, with adjusted revenues falling 8% against a 1% production decline. Revenues in South America, Aptiv’s smallest region, decreased 4%. The regional results reflected strength in North America and Asia-Pacific, partly offset by weak European demand. Engineered Components revenues increased 4.8% year over year to $1.80 billion. Adjusted revenue growth was 3%, with automotive revenues flat and non-automotive revenues up 11%. North American demand was the primary growth driver. The segment’s adjusted EBITDA rose 17.5% to $403 million. Its adjusted EBITDA margin expanded to 22.4% from 21.4%, benefiting from higher volumes, operating execution and favorable timing of customer recoveries, despite stranded costs following the Electrical Distribution Systems spin-off. Intelligent Systems revenues were $1.50 billion, compared with $1.51 billion in the prior-year quarter. Adjusted revenues were flat as a 12% increase in non-automotive business and 10% growth in Software and Services were offset by a 3% decline in automotive revenues. Adjusted EBITDA decreased 8.3% to $210 million, while the segment margin contracted to 14% from 15.2%. Increased engineering investments and stranded costs more than offset performance initiatives during the quarter. Adjusted EBITDA increased 12.1% to $613 million. The adjusted EBITDA margin expanded 160 basis points to 18.7% on a continuing operations basis, supported by higher volumes and favorable foreign-currency effects, partly offset by increased commodity costs. Adjusted operating income rose 15.4% to $473 million, and the corresponding margin improved to 14.4% from 12.8%. GAAP operating income increased to $367 million from $325 million. Interest expense declined to $62 million from $92 million, while tax expense increased to $52 million from $16 million. Aptiv secured about $5 billion in new commercial awards, comprising $2.4 billion in Intelligent Systems and $2.5 billion in Engineered Components. The company won its first commercial Gen 8 Radar award and expanded into robotics through a perception-systems award. Non-automotive progress included robotics, drones, energy storage and commercial vehicles. Aptiv also reported a commercial drone win in July and continued collaborating with NVIDIA on production-ready edge Artificial Intelligence platforms. Software and Services growth further supported the company’s diversification beyond automotive markets. Cash provided by continuing operations totaled $137 million, down from $326 million a year ago. Free cash flow was $12 million compared with $219 million, reflecting capital expenditures and costs associated with separating the EDS business. Aptiv ended June with $761 million in cash and cash equivalents and $5.33 billion in long-term debt. The company repurchased 4.1 million shares for $250 million during the quarter, bringing first-half repurchases to $325 million. About $1.8 billion remained under its authorization. For the third quarter, Aptiv expects revenues to be in the range of $3.12-$3.22 billion. APTV’s adjusted earnings are projected to be between $1.25 and $1.35 per share. Its adjusted EBITDA is projected between $545 million and $575 million, with a margin of 17.7%. For 2026, revenues are forecast at $12.6-$12.8 billion, below the prior range of $12.8-$13.2 billion. Adjusted earnings are expected between $5.60 and $5.80 per share compared with the previous outlook of $5.70-$6.10. Customer-mix pressures, particularly in China, production changes, launch delays and software timing prompted the revised forecast. It turns out, fresh estimates have trended downward during the past month. The consensus estimate has shifted -16.2% due to these changes. Currently, APTIV PLC has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. Charting a somewhat similar path, the stock has a grade of A on the value side, putting it in the top quintile for this investment strategy. Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in. Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise APTIV PLC has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months. APTIV PLC is part of the Zacks Technology Services industry. Over the past month, SLB (SLB), a stock from the same industry, has gained 16.5%. The company reported its results for the quarter ended June 2026 more than a month ago. SLB reported revenues of $8.97 billion in the last reported quarter, representing a year-over-year change of +5%. EPS of $0.55 for the same period compares with $0.74 a year ago. For the current quarter, SLB is expected to post earnings of $0.62 per share, indicating a change of -10.1% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.3% over the last 30 days. The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for SLB. Also, the stock has a VGM Score of C. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Aptiv PLC (APTV) : Free Stock Analysis Report SLB Limited (SLB) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

BlackBerry Limited BB reported a strong start to fiscal 2027, with higher revenue and profitability across QNX and Secure Communications supporting improved earnings. First-quarter revenue reached approximately $153 million, up 26% year over year and above the high end of guidance. Adjusted gross margin expanded 4 percentage points year over year to 79%, while adjusted EBITDA more than doubled to approximately $36 million, representing 24% of revenue. Adjusted net income was roughly $25 million, and adjusted EPS reached 4 cents, at the high end of the company’s guidance. BlackBerry also reported positive GAAP net income for the fifth consecutive quarter. QNX contributed significantly to the margin improvement. Revenue increased 26% year over year to approximately $72 million, while adjusted gross margin expanded about 5 percentage points to 86%. Adjusted EBITDA grew 52% to around $19 million, or 27% of revenue. Management noted that higher-margin QNX royalties are becoming a larger part of the revenue mix, allowing more revenue to translate into margin expansion, profitability and cash generation. As the business shifts further toward royalties, which carry close to 100% margin, management expects potential for additional margin expansion. Secure Communications also recorded a 2-percentage-point year-over-year increase in adjusted gross margin, supported partly by a favorable mix of higher-margin software revenue. Revenue rose 24% to approximately $74 million, while adjusted EBITDA reached around $20 million, representing a 27% margin. Management expects greater margin variability in Secure Communications because large government deals can drive significant quarterly revenue and profitability. Following the strong quarter, BlackBerry raised its fiscal 2027 outlook. QNX revenue guidance increased to $295 million-$312 million, with adjusted EBITDA projected at $74 million-$86 million. Licensing revenue guidance was raised to approximately $29 million, with adjusted EBITDA of $25 million. Revenue guidance increased to $594 million-$621 million, while adjusted EBITDA guidance rose to $119 million-$139 million. On the last earnings call, management highlighted 90% flow-through of incremental revenue into adjusted EBITDA as evidence of strong operating leverage. For the second quarter, revenue is expected at $137 million-$148 million, adjusted EBITDA at $20 million-$30 million and adjusted EPS at 3-4 cents. CrowdStrike CRWD benefits from a high-margin subscription-driven business model, with subscription revenues accounting for 95% of fiscal 2026 revenues. The recurring nature of these revenues supports margin stability and provides greater visibility as customers renew and adopt additional Falcon modules. Strong operating cash flow and free cash flow generation also underscore improving financial efficiency. However, margins remain exposed to elevated operating expenses, particularly investments in sales and marketing and R&D. These expenses increased 20% and 29%, respectively, in fiscal 2026. Continued investment and competitive pricing pressure could constrain margin expansion despite the favorable subscription mix and growing scale. Aptiv PLC APTV continues to face near-term margin pressure despite solid profitability in Engineered Components. Second-quarter 2026 adjusted EBITDA margin expanded 160 basis points to 18.7%, supported by operating execution, volumes and favorable currency effects. However, Intelligent Systems margin contracted to 14% from 15.2% as higher engineering investments, customer mix and stranded EDS costs weighed on profitability. Ongoing restructuring, separation expenses, commodity inflation and OEM price reductions of 1-3% annually could further limit margin expansion. Although productivity initiatives and non-automotive growth provide support, launch delays, weaker European demand and elevated R&D spending suggest that sustaining recent margin gains may remain challenging. Shares of BlackBerry have soared 40.6% in the past three months compared with the Internet-Software industry’s 14.6% growth. Image Source: Zacks Investment Research Regarding the price/book ratio, BB is trading at 6.82, higher than the industry’s multiple of 4.56. Image Source: Zacks Investment Research The Zacks Consensus Estimate for BB earnings for fiscal 2027 has been revised downward over the past 60 days. Image Source: Zacks Investment Research BlackBerry currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report BlackBerry Limited (BB) : Free Stock Analysis Report Aptiv PLC (APTV) : Free Stock Analysis Report CrowdStrike (CRWD) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Aptiv PLC recently reported its second-quarter 2026 results, showing sales of US$3,274 million versus US$3,199 million a year earlier, while net income declined to US$248 million from US$393 million and the company continued a large share repurchase program totalling about 52.51 million shares for roughly US$3.26 billion since August 2024. Soon after these results and moderated third-quarter guidance, Aptiv was added to the Zacks Rank #5 (Strong Sell) list following a 10% downward revision to current-year earnings estimates over 60 days, highlighting growing concern about its earnings trajectory despite ongoing revenue growth and capital returns. Next, we’ll examine how softer Q2 profitability and more cautious Q3 earnings guidance may influence Aptiv’s existing investment narrative. The future of work is here. Discover the 37 top robotics and automation stocks leading the charge in AI-driven automation and industrial transformation. To own Aptiv, you need to believe that demand for electrified, software-centric vehicles and higher content per car will outweigh current earnings pressure and execution risks. The softer Q2 profitability and more cautious Q3 earnings guidance sharpen focus on near term margin resilience, but they do not fundamentally change the core thesis around vehicle electrification and ADAS. In the short term, the biggest risk remains any prolonged squeeze on margins if costs stay high while pricing power is limited. The most relevant recent development here is the Q3 2026 guidance, which points to net sales of US$3,120 million to US$3,220 million and GAAP net income of US$180 million to US$200 million. Set against the large, ongoing buyback program and the Zacks Rank #5 (Strong Sell) designation after a 10% cut to current year earnings estimates, this more cautious outlook places extra weight on how quickly Aptiv can stabilise profitability while still funding its growth programs. But while the long term electrification story is appealing, investors should be aware that margin pressure and lowered earnings estimates could still... Read the full narrative on Aptiv (it's free!) Aptiv's narrative projects $14.6 billion revenue and $1.6 billion earnings by 2029. Uncover how Aptiv's forecasts yield a $78.21 fair value, a 56% upside to its current price. Some of the most pessimistic analysts already expected revenue to shrink about 13.8% a year and earnings to reach roughly US$1.5 billion by 2029, so after Aptiv’s weaker Q2 margins and softer Q3 guide, you may find their focus on rising input costs and customer concentration risk feels closer to the mark than the consensus, or you may decide those concerns are still too harsh. Explore 3 other fair value estimates on Aptiv - why the stock might be worth over 2x more than the current price! Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so go with your instincts. A great starting point for your Aptiv research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision. Our free Aptiv research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Aptiv's overall financial health at a glance. Early movers are already taking notice. See the stocks they're targeting before they've flown the coop: We've uncovered the 10 dividend fortresses yielding 5%+ that don't just survive market storms, but thrive in them. Invest in the nuclear renaissance through our list of 93 elite nuclear energy infrastructure plays powering the global AI revolution. Find 53 companies with promising cash flow potential yet trading below their fair value. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include APTV. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Image source: The Motley Fool. Thursday, Aug. 6, 2026 at 8:20 a.m. ET Chair and Chief Executive Officer - Kevin Clark Executive Vice President and Chief Financial Officer - Varun Laroyia Vice President, Investor Relations - Betsy Frank Operator: Good day, and welcome to the Aptiv Q2 2026 Earnings Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Betsy Frank, Vice President, Investor Relations. Please go ahead. Betsy Frank: Thank you, Shelly. Good morning, and thank you for joining Aptiv's Second Quarter 2026 Earnings Conference Call. The press release and slide presentation can be found on the Investor Relations portion of our website at aptiv.com. Today's review of our financials exclude amortization, restructuring and other special items and reflect the continuing operations of Aptiv as of June 30, reflecting the treatment of our EDS segment as a discontinued operation for the second quarter 2025. The reconciliations between GAAP and non-GAAP measures are included at the back of the slide presentation and the earnings press release. Unless stated otherwise, all references to growth rates are on a pro forma adjusted year-over-year basis. During today's call, we will be providing certain forward-looking information that reflects Aptiv's current view of future financial performance and may be materially different for reasons that we cite in our Form 10-K and other SEC filings. Joining us today are Kevin Clark, Chair and Chief Executive Officer; and Varun Laroyia, Executive Vice President and Chief Financial Officer. With that, I'll turn the call over to Kevin. Kevin P. Clark: Thank you, Betsy, and thanks, everyone, for joining us this morning. Starting on Slide 3. During the second quarter, we generated 2% revenue growth and 10 basis points of EBITDA margin expansion. And we continue to demonstrate progress diversifying our business, evidenced by double-digit non-auto revenue growth in the quarter and new business awards in attractive, high-growth markets that present expansion opportunities for Aptiv. And while we're increasingly optimistic about the long-term opportunities presented in these areas, in the near term, we continue to contend with challenges in our traditional automotive market, which are leading us to lower our 2026 guidance, including prolonged sales weakness in the domestic China market, which is causing local OEMs to reduce second half production on vehicle platforms for the domestic market and also leading to a further reduction in schedules from luxury European OEMs for vehicles exported to the China market. Varun is going to walk you through how these dynamics and other factors are impacting our guidance for the remainder of the year and what specifically has changed since we last spoke to you. And I'll spend a bit more time discussing the actions we're taking including how we're working to evolve our business mix in and outside of the automotive market to mitigate the challenges we're experiencing today. And now that the separation of EDS is complete, we'll continue to evaluate additional opportunities to maximize value for shareholders over the long term. Now let's begin by reviewing our second quarter progress against our strategic priorities. During the second quarter, we continued the momentum we'd established, leveraging our product portfolio and operating capabilities across diverse end markets, including product innovations, where we secured our first Gen 8 radar award, an important component of our ADAS platform. Penetration into new end markets where the products we've developed for automotive have applications in other markets reflected in the award from Robust.AI, which I'll talk more about later and expansion of our software partnership ecosystem with leading-edge AI players, including most recently with NVIDIA. This list represents a small portion of the $5 billion of new business awards during the second quarter, bringing our year-to-date total to $10 billion, putting us on track for our $20 billion full year target. We also continue to increase the resiliency of our business model by leveraging our digital twin and end tier tracking capabilities to provide our automotive and adjacent market customers with a step change in supply chain visibility and reaching long-term supply agreements as part of our supply chain resiliency efforts. These are both great examples of the actions we've taken to enhance the robustness of our operating model that are enabling us to keep our customers connected in this dynamic environment and is one of the reasons we were recently recognized as Supplier of the Year by Ford in the supply chain category. On capital allocation, we repurchased $250 million of our shares in the second quarter, bringing our year-to-date total to $325 million with an intention to repurchase a similar amount in the second half of the year and bring the full year total to over $600 million. And over the next few years, we're committed to returning approximately half of our free cash flow to shareholders through share repurchases, while simultaneously pursuing smaller bolt-on M&A transactions to diversify the business and better position us for the long term. Turning to review our business segments through the lens of the automotive and non-automotive end markets we serve. Starting with the automotive market highlights during the quarter, we made some meaningful progress expanding our business with leading OEMs in Asia Pacific, and driving growth in new business bookings across next-generation technology areas, including our full stack Gen 6 ADAS system and in-cabin solutions like driver and cabin monitoring. Notable program launches in the quarter included within the Intelligent Systems segment, a full tech stack ADAS award across additional vehicle lines of a large European OEM, demonstrating the flexibility and scalability of our solutions and continued strength of our technology partnership. And the launch of our next-generation digital cockpit for a luxury European OEM in incorporating software-enabled functionality via over-the-air updates and life cycle management capabilities. And within the Engineered Components segment, the integration of our high-voltage interconnects on a European OEM's next-gen high-powered 800-volt architecture program. We also continue to innovate across our product portfolio, evidenced by the introduction of our advanced occupancy classification system which is the industry's first occupant detection system that utilizes AI/ML-based computer vision software and is powered entirely by an in-cabin camera, streamlining vehicle systems architecture as well as lowering cost. We also secured several important new business awards in the quarter. Within Intelligent Systems, these included Gen 8 radar award by Volvo Cars for its next-gen software-defined vehicle platform, where we will enable robust perception across increasingly complex environments and driving scenarios. As well as an award from a large North American OEM's next-generation software-defined vehicle architecture, a critical milestone in the transition to more centralized vehicle architectures. And within Engineered Components, these include high-voltage busbars across the North America and China markets for battery pack and charging applications, demonstrating continued penetration of both existing and new OEM customers on their next-generation EV platforms and the continued expansion of our business with the leading China local OEMs across our key product lines, including high-speed cable assemblies and high-voltage inlets across platforms for both the domestic and the overseas markets. Moving to Slide 6 to discuss our progress in non-automotive markets, which reflects the applicability of our technologies across a diverse set of end markets and the strong operating execution by our team. Starting with program launches during the quarter. In Engineered Components, we launched a new program providing high-performance interconnects for a utility scale energy storage provider that leverages the same technology we're already delivering in automotive. And in Intelligent Systems, we launched our integrated cockpit controller for one of the industry-leading commercial vehicle OEMs. In terms of product development in the second quarter, this included expanding our high-performance interconnect product lines for complex aerospace and defense platforms where space-efficient, high-density solutions are critical for customers and collaborating on an optimized power solutions for 800-volt DC architectures with a leading developer of power electronics for next-generation infrastructures, including data centers, a market where we experienced strong commercial momentum and see very meaningful growth opportunities over the next few years that will further accelerate with the transition to 800-volt architectures. And lastly, achieving a key software milestone and cybersecurity rating for enterprise Linux operating system, which will expand our potential opportunities in the government and the defense markets. A few notable business awards in the second quarter included Robust.AI selection of our intelligent perception solutions in compute, including AI and ML-based sensor fusion powered by our innovative PULSE Sensor, for its Gen 3 Carter robot, which I'll talk more about on the next slide. And in Engineered Components, an award for our high-performance cable management and protection solutions for large-scale solar energy and battery storage projects in the U.S. market. Lastly, we continue to expand our commercial presence in non-auto markets through our partnership ecosystem. First, with NVIDIA, where we extended our partnership to provide Aptiv's production-grade software to edge AI customers using NVIDIA compute, second with Kyndryl, which is an important extension of our enterprise partner ecosystem where Kyndryl will deploy our Wind River software as part of its mission-critical solutions portfolio. Together, they enable customers to more easily deploy and operate mission-critical systems while accelerating adoption through joint go-to-market initiatives and integrated offerings. Turning to Slide 7. I want to spend a few minutes providing an overview of our progress, capturing opportunities in new end markets, which we're confident will meaningfully diversify our nonautomotive revenue mix over the next few years. The robotics and drone markets are higher growth, higher-margin sectors where opportunities materialized much faster than we previously anticipated, driven by the same demand for autonomous solutions that have been transforming automotive over the past decade. Since initially outlining our addressable market opportunity and growth targets for non-automotive markets, we've achieved the following, in robotics, we secured partnerships with 3 leading robotics manufacturers and one of those partnerships has advanced to a meaningful commercial agreement, and we expect to be making additional commercial announcements during the balance of the year. In drones, in July, we secured our first commercial award from a leading drone manufacturer with total lifetime revenues of over $500 million over a 5-year program. This award will be included in our third quarter bookings numbers. We're actively engaged in discussions with several drone manufacturers that we expect to translate into commercial agreements during the balance of the year. The content per device opportunity in the robotics and drone markets are significant, and our initial awards represent a large portion of that total content opportunity. And both of these markets present time-to-market advantages versus our experience in automotive. In summary, we're increasingly confident in the broad relevance of our product portfolio across multiple end markets, which will significantly change our business mix. We have a high degree of confidence in achieving annual revenues from the robotics and drone markets of about $300 million over the next few years. We believe we're also uniquely positioned to benefit from growth opportunities in the space, energy storage and data center markets, which we'll talk more about in the future. I'll now turn the call over to Varun to go through our financial results and guidance in more detail. Varun Laroyia: Thanks, Kevin, and good morning, everyone. Starting on Slide 8 with our second quarter financial results. We delivered revenues of $3.3 billion, which grew at an adjusted rate of 2% and were just shy of the midpoint of our guidance. Looking at revenue growth by region, North America grew 10%, driven by strength across both segments. In Europe, revenue was down 8%, primarily reflecting volume pressures with select luxury OEMs, predominantly in Intelligent Systems. And in Asia Pacific, revenue increased 6%, including 5% growth in China, driven by improved mix with local OEMs, partially offset by a slowdown in production for the domestic market. Adjusted EBITDA totaled $613 million, and adjusted EBITDA margin increased 10 basis points. This came in ahead of our guidance due to the timing of recoveries and operating performance. FX and commodities amounted to a 30 basis point headwind to margin, in line with our expectations. Earnings per share was $1.63, an increase of $0.12 from the new Aptiv pro forma results in Q2 2025, reflecting higher operating income the benefit of share repurchases and interest other income, partially offset by higher tax expense. Free cash flow for the quarter was an outflow of $33 million and included approximately $70 million in cash separation costs associated with the Versigent's spinoff, which we highlighted last quarter. Moving to Slide 9 and starting with highlights on the Consolidated business. We generated strong results in strategically important non-automotive revenues with 12% growth while absorbing some customer mix headwinds in our automotive business in the second quarter, where revenues declined to 1%. Adjusted EBITDA margin increased 10 basis points driven by flow-through on revenue growth, strong performance across material and manufacturing and a benefit in timing of certain recoveries more than offsetting the impact of stranded costs following the Versigent's spin, which we are aggressively working to eliminate. Turning to Intelligent Systems. Revenue of $1.5 billion was flat versus the prior year, which reflects strength in the non-auto which was driven by software and services. And this was offset by automotive revenues, which were impacted by weakness with certain European OEMs and a lower production at a North American OEM, impacted by a supplier fire. Intelligent Systems adjusted EBITDA margin declined 120 basis points, primarily driven by investments in non-auto markets and the impact of stranded costs. Moving to Engineered Components. Revenue of $1.8 billion grew 3% versus the prior year, driven by double-digit growth in non-auto markets and more specifically, in diversified industrials and aerospace and defense, while automotive revenues were essentially flat. Adjusted EBITDA margin increased 100 basis points and reflects flow-through on volume growth, favorable timing of the previously mentioned recoveries and performance initiatives, partially offset by stranded costs. Turning to our full year 2026 financial guidance on Slide 10. As a reminder, historical new Aptiv pro forma financials are on the Investor Relations website under the Quarterly Financial section, and those correspond to our guidance that treats Q1 as new Aptiv pro forma. Starting with the full year, we now expect revenue in the range of $12.6 billion to $12.8 billion, which implies adjusted growth of 2% at the midpoint. I'll discuss the changes here in detail on the next slide. We expect adjusted EBITDA in the range of $2.31 billion to $2.37 billion, and an EBITDA margin of 18.4% at the midpoint, reflecting the impact of lower revenue growth, which is partially offset by performance. We now expect adjusted earnings per share in the range of $5.60 to $5.80. With the midpoint of $5.70, reflecting lower operating earnings, partially offset by a slightly lower effective tax rate and a lower share count. This also includes the projected impact of an additional $300 million in share repurchases through the remainder of the year, as Kevin mentioned. Lastly, free cash flow is expected to be in the range of $625 million to $725 million, reflecting the reduction in EBITDA. As a reminder, this includes the onetime cash separation costs associated with the Versigent's spin-off, which have already been largely incurred year-to-date and the continued investments in supply chain resiliency for semiconductors. For the third quarter specifically, we expect adjusted revenue growth of 1% at the midpoint, adjusted EBITDA and EBITDA margin of $560 million and 17.7% at the midpoint, and earnings per share of $1.30 at the midpoint. Turning back to our full year guidance to discuss the key changes to revenue in further detail. We are reducing full year revenue guidance at the midpoint by $300 million, which reflects the following: first, approximately $150 million related to changes in customer production schedules. These schedule revisions are primarily related to weakness in the domestic China market with both local China OEMs and European OEMs that export to China. Second, $100 million related to delays in program launches and ramps, specifically delayed ramp in production volumes on certain programs in China and the launch with a European OEM, where the launch is delayed by the OEM, and we did not benefit from the expansion to additional car lines as we originally anticipated. And finally, approximately $50 million related to the timing of enterprise sales in software and services. While these items have impacted both business segments, the Intelligent Systems business is disproportionately impacted by the above factors. Now translating this to the implied ramp in year-over-year revenue growth from the first half to the second half that we outlined last quarter. As a result of what I just described, the following have changed. First, the 150 basis points improvement in growth from lapping of previously identified headwinds, specifically the lower production with a major North American customer due to a supplier fire and program cancellations with local China OEMs is unchanged. Second, launches and ramps are now expected to contribute 200 basis points to revenue growth in the second half of the year. This is lower by 100 basis points than initially anticipated, reflecting the programs I previously described. And beyond that, the outlook for vehicle production in the second half has turned from a tailwind to a headwind. This is further amplified by our customer and program mix due to the schedule changes I outlined earlier, which are cumulatively now a 150 basis point headwind to revenue growth in the second half. I want to wrap up with some closing comments on these revisions. First, the China domestic market, which has and continues to be a more volatile region, has clearly deteriorated relative to when we last updated you. And second, we were not conservative enough in certain assumptions, particularly around launches and ramps. To that end, we have incorporated an additional element of conservatism in the second half of this year. I will close by noting that we continue to see long-term opportunity across a diverse set of end markets and across regions where we are delivering solid progress as evidenced by our revenues, bookings and commercial awards. With that, I will turn the call back to Kevin for his closing remarks. Kevin P. Clark: Thanks, Varun. I'll wrap up on Slide 12. In summary, we remain confident in the significant long-term opportunity resulting from secular trends that are demanding solutions that can sense think, act and optimize and the customer needs they introduce for high performance and cost optimized solutions. However, we also acknowledge the more near-term challenges to our business, driven by ongoing volatility in the domestic China market and the related impact on our broader automotive customer mix. To be clear, our customer mix in China has improved and dramatically moved towards the local OEMs. However, this improvement has not been enough to offset the rapid shift of local OEMs business toward export platforms as well as the reduction of European vehicle exports into the China market. Holistically, we continue to focus on improving the revenue mix of our business both inside and outside of automotive. We also remain laser focused on execution, delivering margin expansion, earnings growth and strong free cash flow generation across a variety of different macro backdrops, and we're keenly aware that these efforts need to translate into increased shareholder value. Based on the significant value opportunity we see in our stock, combined with the strength of our cash flow generation and balance sheet, we intend to remain active buyers of our shares, utilizing approximately 50% of our expected free cash flow on a more regular basis over the next few years to repurchase our shares. And in 2026, our repurchases will be materially above this level. We're also committed to continually evaluating our business portfolio in light of changes in the macro environment to maximize shareholder value. We're confident that we'll continue to deliver value for our customers, drive profitable growth and create sustainable long-term value for our shareholders. Operator, let's now open the line for questions. Operator: [Operator Instructions] We'll now go to your first question. It will come from the line of Itay Michaeli with TD Cowen. Itay Michaeli: Great. I know it's a little bit early to talk about 2027, but I'm just curious kind of how some of the changes you're seeing in the second half of the year kind of inform you in terms of just the prior 4% to 7% growth framework into 2027 and beyond and kind of how we should think about that just given some of these changes here in the second half? Kevin P. Clark: Yes, sure. Thanks, Itay. Listen, our long-term view of what the business is capable of remains intact. Now clearly, drivers of growth are constantly changing, especially in an environment that is dynamic as this environment is. When you look at the automotive sector, IHS has brought down the growth outlook for future vehicle production. Clearly, material cost inflation is increasing in light of various macroeconomic factors. However, having said that, within the automotive sector for the second straight year, we're running with very strong bookings across both of our businesses with the leading automotive OEMs inside and outside of China. On the non-auto side, opportunities are materializing much faster than we had initially expected. And that's across both of our business segments. And we've had a tremendous amount of success leveraging our automotive portfolio into these new markets. So that's an area that we're very optimistic but the environment certainly is dynamic. I won't get in specifically into 2027 at this point in time. As we move later into the year, that's something that we'll certainly provide incremental information about and updates on. Itay Michaeli: Great. That's helpful, Kevin. And as a quick follow-up, good to hear a little bit more conservatism in the second half guidance. I think the Q4 revenue guide still implies a pretty healthy uptick versus Q3. Maybe just talk about some of the drivers and puts and takes and degree of visibility kind of into that Q4 ramp. Varun Laroyia: Itay, it's Varun Laroyia out here. Listen, yes, in terms of when you think about the year-over-year second half and also Q4 in particular, essentially, it's a couple of points, right? The first is the year-over-year uptick in the production with the North America customer, which had a fire at their supplier a year ago. So that unwinds from a comp perspective. The second is growth in our software and services business. As I mentioned, the $50 million reduction in software enterprise bookings is from a timing perspective. So we expect Q3 to be softer, but again, return to high single double-digit levels in the fourth quarter and then just growth in our Engineered Components business. Operator: Your next question will come from the line of Mark Delaney with Goldman Sachs. Mark Delaney: Kevin, you mentioned that even though Aptiv has been making good progress with its bookings for the Chinese domestic OEMs, not enough of those were on the export vehicles. Maybe you could talk a bit more on that. I mean I would have thought Aptiv was very well positioned for exports given the global nature of Aptiv and your strength in other regions. So maybe talk a little bit more on what's happening and what Aptiv is going to do on that front going forward? Kevin P. Clark: Yes. So Mark, that's a great question and a very fair one. So we are very well positioned. I would say, over the last couple of years, the real focus was on how do we get stronger mix with the leading local OEMs. When you take a look at our revenues today in China on export platforms, it's about 10% of total revenues. So the mix is more heavily weighted for the domestic platforms. As you look at our bookings over the last 2 years, that percentage has significantly increased. So the benefit of our product portfolio and our capabilities outside of the China market are certainly coming into play. But right now, our revenues don't match the bookings mix over the last 2 years. And that's something we're working on, and that's something, quite frankly, we've been making progress on over the last the last year or so. Mark Delaney: Okay. I also wanted to ask about the nonautomotive opportunities and nice to see the solid growth the last couple of quarters there. You mentioned specific progress in drones and robotics. I think you said that business could approach $300 million of revenue in the next few years. What does that mean in terms of profitability? I don't know non-auto can be higher margin, but maybe there's also a number of investments you're making. So if you could speak a bit more on what you're seeing there and how to think about the profit implications. Kevin P. Clark: Yes. So from a run rate standpoint, margin profile, as you can imagine, is much higher than what's in automotive. We're investing in non-automotive capabilities today from a product and go-to-market standpoint that we talked about. There's minimal capital investment because we're using existing facilities, existing machinery and equipment. So from a capital standpoint, that's less of an upfront cost and initial drag. But it is a -- both markets are much higher margin profiles than what we experienced in the automotive industry. Operator: Next question will come from the line of Emmanuel Rosner with Wolfe Research. Emmanuel Rosner: Great. One quick question on the change in guidance. It seems like -- so I understand some of the revenue drivers, but it seems that the EBITDA line, maybe the implied decremental would be pretty high, like around maybe 40%, which seems maybe a little bit above the normal. So can you maybe just talk about the change in the EBITDA guidance? Varun Laroyia: Yes. Emmanuel, it's Varun Laroyia out here. Listen, the specific one really is the software timing item that I mentioned. So that really has to do with the product mix. So that's the one which kind of leads to the second half, the $50 million reduction that I'm talking about, that really is what impacts that. Emmanuel Rosner: Okay. So this is a very, very high decremental. And so therefore, on average, the total is around that 40%. Kevin P. Clark: Yes, it's -- I think, typically, the mix would be -- the decremental would be less than that. I think just given the size of the software revenue reduction was roughly $50 million in the back half. The flow-through on that tends to be higher. Therefore, the overall decremental in that particular period is higher. Emmanuel Rosner: Understood. And then I understand the software revenue changes timing. Can you maybe just give a little bit more color around what's going on the ground and just sort of like how do you think about growth in the software on a go-forward basis? Kevin P. Clark: Yes. So growth in software. So we've been growing kind of low double digits over the high single-digit, low -- high single, low double digits over the last several quarters in the software business. Our software businesses is kind of twofold when you break it down, Embedded Solutions, which I would say, tend to be less lumpy and then enterprise solutions that go into markets like telco and industrial markets, which tend to be larger in terms of their overall size, Emmanuel. And at times, they can shift for various reasons. And when they shift, it has a more pronounced impact on a particular quarter's growth rate. Emmanuel Rosner: Okay. But on a go-forward basis, the -- what sort of less growth rate would you expect? Kevin P. Clark: Yes. I think our growth rate will continue in the double-digit sort of growth rate with the target of getting to that mid-teens sort of growth rate. We've been a bit below that over the last few quarters. Operator: Next question will come from the line of Joe Spak with UBS. Joseph Spak: Look, I appreciate sort of the coming clean on not being conservative enough and you think you've built in more a cushion going forward. But we've been here before. So maybe you could just sort of walk through how or what you're doing to sort of changing your planning process for some of this uncertainty? Because like I know it's schedule changes and ramps, but really, it's all sort of the same, right? It's all one and the same, it's volume. So how are you thinking about one, planning the business? And two, sort of communicating that on a go-forward basis, like what's changing from here? Kevin P. Clark: Yes. Yes. I think -- no, Joe, that's a fair question. So I think as it relates to as China becomes a bigger part of our overall revenue base is the China local OEMs become a bigger part of our overall mix. As well as I do, China OEMs have a number of different nameplates or a higher mix of nameplates relative to the Western OEMs. Just a more significant haircut from an overall conservatism standpoint. I think that is the major change in terms of our process in terms of how we operate internally and how we forecast externally. So to date, we've had a process where we've discounted those schedules, obviously, have not discounted them enough. I would say the China domestic market is significantly weaker at this point in time than what it's been over a number of years with domestic retail sales down 20%. I think most people in our industry would have expected that the China government would have stepped in to provide some element of support as it relates to the industry. It hasn't yet. And assuming that they would provide some support, obviously, near term was a mistake. So I think it's just an overlay of significantly more conservatism. Joseph Spak: Okay. And then maybe just some quick hitters on some of the non-auto things. One, like how quick can sort of the drone business come into sales. I noticed you said you're collaborating on 800V DC. Can you just describe that a little more? Is that something you're licensing and building? Or are you creating your own solution? And then the optical M&A, is that a tech buy and something you need to commercialize? Or is there a book of business there? Kevin P. Clark: Yes. So there's a couple of layers to that. So as it relates to whether it's drone robotics, or energy storage depending on the customer. The path to market is much faster on the robotics and drone awards this year, we'll have revenues in 2027. So I would expect typically roughly 6 months path to revenue. On the energy storage/data center side, most of our product portfolio is in and around power side, transition to 800-volt given our portfolio -- existing portfolio in 800-volt present incremental opportunities. We're working with several players. We'll be talking about more commercial awards, I'm sure, over the next couple of months. Today in that space, we have under $50 million in revenues. We expect that to grow at a very rapid rate, Joe, over the next 3 years. And again, most of that is in and around power both to the rack and now with some capabilities in the rack and the M&A acquisition is just building out our portfolio as it relates to products that we can take quite frankly, across multiple markets. Operator: Your next question will come from the line of Colin Langan with Wells Fargo. Colin Langan: We've talked a lot about China being weak, and I'm not sure if I'm looking at Slide 8 wrong, but you actually -- it looks like you outperformed in China according to that slide, you were up 5% and the market down 3%, and it was pretty weak in Europe. So is that really the bigger issue or -- because I think you mentioned also in comments about European exports to China weakening. Is that the bigger factor that's causing a headwind here? And is that possibly why we've seen other suppliers haven't cut guidance do you have like higher exposure to some of those players, and that's having a bigger impact? Kevin P. Clark: No. So there's a couple of aspects. So we talked about traction in commercial awards in China with the local OEMs. So we have made significant progress and that is what's reflected in our overall year-over-year growth. Having said that, that year-over-year growth was not as strong as we had initially forecasted and included in our guidance. So yes, it's strong -- we showed strong growth, strong outgrowth, but not where we expected it to be. As it relates to the impact of China, the domestic market, the decline in the domestic market, the reduction in schedules impacted the local OEMs, impacting both our EC business as well as our IS business. Our IS business was disproportionately impacted by the #2 player in the China market who we were launching several active safety programs with. From a European standpoint, it really is principally the export of vehicles into the China market from 2 luxury European OEMs that we saw a significant reduction in their schedules depending on the OEM late June or July, I think they are the OEMs that have been the most public about their challenges in the China market. So you can identify who those are. So that's where the biggest impact, quite frankly, is. Colin Langan: Got it. And then just to follow up on earlier questions. The margins seem to kind of -- the quarterly cadence here is a little odd. It's like there's a pretty negative decremental sequentially and then a big incremental into Q4. Is this all recovery driven? Is there some cost headwinds in Q3? Kevin P. Clark: So there are 3 things. So here's how I would look at it. One is just volume flow through Q2 to Q3. The incremental impact of a piece of that being software, so higher margin going from Q3 to Q4 bounce back in software, higher margin, volume pick up, just underlying volume and flow through on that volume. And third, as you know, engineering credits, recoveries, things like that tend to be stronger in the fourth quarter than they are in other quarters. So that's the walk. There is an element of Q3 margin that's impacted by Varun mentioned in his comments, timing on recovery. So normally, that would have shown up in Q3. So Q3 is a little bit, let's call it, artificially lower than what we would have expected that has some general impact. But my comments about the walk as it relates to volume, software recoveries, that's the biggest piece. Operator: Your next question will come from the line of James Picariello with BNP Paribas. James Picariello: Kevin, can you share some thoughts behind the portfolio changes you had indicated at the tail end of your prepared remarks? Kevin P. Clark: Listen, I don't have any specific comments I would make at this point in time. Clearly, we're operating in a very dynamic market, right? And that's across regions and across technologies. And as we always do, we're evaluating that mix of products, that portfolio and how we optimize and drive shareholder value. So I would just leave it at that. James Picariello: Yes. Understood. And then just can you share segment level color on the updated guide here for the full year? What's embedded for each segment's non-auto growth in the outlook? Kevin P. Clark: Yes. I think non-auto growth for both for the full year are relatively strong. On third quarter in the Intelligent Systems segment. It will be weaker, given that software adjustment that I talked about. But we see a strong bounce back in the fourth quarter. Non-automotive revenue growth across both of the businesses has been very strong and in line with our 8% to 10% sort of framework that we've provided previously. James Picariello: And then just like revenue, core growth in margins by segment or just directionally would be great. Kevin P. Clark: Yes. Just to be sure, are you asking that for the full year or... James Picariello: Yes, yes, full year. Varun Laroyia: Yes. Listen, in terms of both businesses, based on the latest update that we've mentioned, as I mentioned, the revision in guidance is largely impacting the Intelligent Systems business, right? And we kind of gave you the puts and takes associated with that. So from an Intelligent Systems perspective, we would expect the business at this point of time to be approximately flat on a year-over-year basis on a revenue basis with Engineered Components growing in the low to mid-single digits. So that's point number one. And then with regards to margins, margins essentially what we've kind of talked about previously, solid margins coming through both businesses with EBITDA margins in Intelligent Systems, call it, at the mid-teens level. And then with regards to -- on a full year basis. And then on our Engineered Components business, in the, call it, low 20s, so call it about roughly about 22 points of margin for the full year. Operator: Your next question will come from the line of Tom Narayan with RBC. Gautam Narayan: Just one more question on the 3 buckets after its change, if that's okay. So it looks like -- yes, look, the schedule change, you have the, I think the European OEMs and the Chinese market the delayed programs and the timing one coming back in Q4. The timing one is fairly obvious. But just curious on the other 2, I guess, do you have any level of confidence that those other 2 buckets, you clearly gave those buckets distinctly for a reason, potentially coming back in 2027, is this what's reliant on the Chinese government coming back with stimulus? Or are some of those like you know you're getting back? And then I have a follow-up. Kevin P. Clark: And Tom, you talk -- you're speaking to all 3 buckets? Or are you speaking to the reduction in H2 customer schedules? Gautam Narayan: Just the non -- the timing one we already know it's going back in Q4, but then you had 2 other items, right? Schedule changing and delay program. So just curious of those 2 buckets potentially coming back in '27. Kevin P. Clark: Yes. So it's -- there's 2 aspects to the China local market. Aspect one is domestic China market with domestic local OEMs and how that plays out during 2027. It's at least for us, difficult to envision another year where the China local market is down 20% and production schedules are, therefore, adjusted to that point. So it's difficult. It's difficult to envision that, but those are some of the things that we're working through. There's a second piece as it relates to within that. So the bulk of that $150 million that Varun talked about is China local OEMs. And then there's a part that is effectively European exports into China. I think it's possible that those European exports into China, we don't see a bounce back during 2027 in light of the competitiveness of the China market. As it relates to the program delays and launch ramps. Listen, the local China OEMs, I'm confident that you'll continue to see their launches ramp at a lower slope than what was originally forecasted. There's one program from a BYD that we're confident will be launched, just was shifted and that's an export vehicle program. And then there is the program that Varun talked about that was a European OEM that was a delayed launch from European OEM that had initially, the view was it was going to be rolled across multiple programs. That program is launching as we speak. So that will be a tailwind from a revenue standpoint as we head into 2027. Gautam Narayan: That's very helpful. It doesn't sound as bad as it is. And then the non-automotive question I have, you mentioned this is coming in ahead of expectations. And I know you discussed this at the Investor Day, and these are all very different verticals. But just curious what you're seeing on the competitive side here that you're able to win so much here? I would have thought that there'd be incumbents in these verticals. Or is this simply just lack of competitors and like kind of a rising tide lifts all boats? Just how have you guys been so successful in capturing these new business wins here? Kevin P. Clark: Yes. So I think -- so I would put them into 2 buckets. I would put the drone and robotics buckets where we're playing, our principal focus on the drone and robotics here is in and around autonomy. So robotics, it tends to be AMRs, although we have commercial opportunities with a few of the humanoid players. Our view on significant volume will be more -- is likely to more come from players like AMRs. It tends to be more of a nascent industry. I know there's a lot of talk about the size and growth, but it's a bit more nascent. And it's not only our technology where we bring opportunity. But it's also our capability as it relates to systems, systems engineering, the material supply chain and manufacturing that is differentiated from the typical players in a nascent industry. On the drone side, that's even more so the case. There's significant demand for reasons that you're aware of. There is a requirement of a non-China supply chain, a number of different technologies. That's something that we have visibility to and we can provide. Our perception systems and compute and ability to take bill of material costs out is unique relative to what their current supply base, which isn't very mature and isn't quite as organized as what we're accustomed to. So I would say it's a mix of bringing our technical capabilities, but there's an equal part of what we do day in and day out from an automotive standpoint so that there aren't really the traditional competitors, if I could say. It's an area that we're moving very fast in. We've invested in capabilities as Varun talked about. We're going to continue to invest and actually ramp up our investment in this area because the potential opportunity near term is significant. And as I said, the margin profile pricing here is more value-based than cost base. So the nature of those 2 markets are very good. On the -- I should now go to, if I can, just to the energy storage/data center. Listen, our sweet spot is power. That's what it is. We've put a very -- a team very focused on those 2 specific markets based on our backgrounds in power distribution. We are working with players who are well known in the automotive space for energy storage, including now Texas-based global OEM as well as the leading China OEM as it relates to leveraging our automotive relationship. And then we're working with several players that I alluded to who support those markets today for incremental opportunities. And today, again, our revenues are relatively small, but the size of the commercial pursuits and bookings we're confident we'll ramp up revenues certainly much faster than what we experienced in the automotive market. Operator: Your next question will come from the line of Rajat Gupta with JPMorgan. Rajat Gupta: Great. I just wanted to start with one clarification on the first quarter restatement. If I look at the press release and take the 6-month EBITDA number, it implies a lower 1Q than what was provided in the 1Q deck and like the financials on the website. I just want to make sure like if that is just an accounting nuance that we need to be aware of write off... Varun Laroyia: Rajat, it's Varun out here. Listen, that's all CODO associated with the Versigent spin. So what you need to look at is the Q1 pro forma on our Investor Relations portal. Rajat Gupta: Understood. So that's the right number. Okay. Got it. Varun Laroyia: Yes. Rajat Gupta: And just a follow-up just on the bookings mix. Within the Intelligent Systems year-to-date bookings or just the second quarter bookings, are you able to share in more detail in terms of how much is like full stack ADAS including software versus modular? And I'm curious like if that mix has changed at all over the last few months, as a lot of manufacturers try to build more internal capability? Kevin P. Clark: Yes. Our -- the trend that we're seeing, and I want to make sure I think you're talking about the Intelligent Systems and tech stack is more of a separation of software and hardware and quite frankly, more software opportunities. And I referenced the full tech stack award board from a Gen 6 ADAS standpoint. We're seeing or experience a significant portion of our bookings in 2026 will be ADAS -- Gen 6 ADAS solutions, the bulk of which will include our hardware and our software. So we're seeing more momentum there. We're seeing more OEMs come to us as they work on their path to software-defined vehicles asking us to do some of that software development in and around areas like middleware and other portions of their software tech stack. So I know there's a -- we often get asked that question about in-sourcing from an OEM standpoint. And it varies a bit by OEM. But we would tell you our experience has been the overall trend. We've not seen that. And in fact, we've seen several OEMs who have attempted to do broad-based software that have decided to go down a different path and be more reliant on suppliers. Operator: And that was our last question. This will now conclude today's question-and-answer session. I will now turn the call back over to Mr. Kevin Clark for any additional or closing remarks. Kevin P. Clark: Thank you, everyone, for joining us today. Have a great day. Operator: This call is now complete, and thank you so much for joining. Before you buy stock in Aptiv, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Aptiv wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $411,427!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,335,252!* Now, it’s worth noting Stock Advisor’s total average return is 965% — a market-crushing outperformance compared to 215% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of August 11, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has positions in and recommends Aptiv. The Motley Fool has a disclosure policy. Aptiv (APTV) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

This article first appeared on GuruFocus. Revenue: $3.3 billion, up 2% on an adjusted basis. Adjusted EBITDA: $613 million, with margin expansion of 10 basis points. Earnings Per Share (EPS): $1.63, up $0.12 from pro forma results in Q2 2025. Free Cash Flow: Outflow of $33 million, including approximately $70 million in cash separation costs. Revenue by Region: North America grew 10%; Europe declined 8%; Asia Pacific increased 6%, including 5% growth in China. Non-Automotive Revenue: Grew 12% in the quarter. Automotive Revenue: Declined 1%. Intelligent Systems Revenue: $1.5 billion, flat versus prior year; adjusted EBITDA margin declined 120 basis points. Engineered Components Revenue: $1.8 billion, up 3%; adjusted EBITDA margin increased 100 basis points. Full Year 2026 Revenue Guidance: $12.6 billion to $12.8 billion, implying 2% adjusted growth at the midpoint. Full Year 2026 Adjusted EBITDA Guidance: $2.31 billion to $2.37 billion, with an 18.4% margin at the midpoint. Full Year 2026 Adjusted EPS Guidance: $5.60 to $5.80, with a midpoint of $5.70. Full Year 2026 Free Cash Flow Guidance: $625 million to $725 million. Q3 2026 Guidance: Adjusted revenue growth of 1% at the midpoint; adjusted EBITDA of $560 million and 17.7% margin; EPS of $1.30 at the midpoint. New Business Awards: $5 billion in Q2, bringing year-to-date total to $10 billion. Share Repurchases: $250 million in Q2, $325 million year-to-date, with plans for over $600 million for the full year. Warning! GuruFocus has detected 5 Warning Signs with FWRG. Is APTV fairly valued? Test your thesis with our free DCF calculator. Release Date: August 04, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Aptiv PLC (NYSE:APTV) delivered 2% revenue growth and 10 basis points of EBITDA margin expansion in Q2 2026, with strong non-auto revenue growth of 12%. The company secured $5 billion in new business awards during Q2, bringing year-to-date bookings to $10 billion, on track for a $20 billion full-year target. Aptiv PLC (NYSE:APTV) is making significant progress in diversifying into high-growth markets, including robotics, drones, energy storage, and data centers, with a first drone award worth over $500 million in lifetime revenues. The company continues to innovate, launching products like the Gen 8 radar and an AI-based occupant detection system, and expanding partnerships with Nvidia and other AI players. Aptiv PLC (NYSE:APTV) is committed to returning capital to shareholders, with $325 million in share repurchases year-to-date and plans to repurchase over $600 million in 2026, using approximately 50% of free cash flow. The company's engineered components segment showed strong margin expansion of 100 basis points, driven by growth in diversified industrials and aerospace/defense. Aptiv PLC (NYSE:APTV) is seeing faster-than-expected opportunities in robotics and drones, with a high degree of confidence in achieving $300 million in annual revenues from these markets over the next few years. Aptiv PLC (NYSE:APTV) lowered its full-year 2026 guidance due to prolonged sales weakness in the domestic China market, leading to reduced production schedules from local OEMs and European luxury OEMs exporting to China. The company faces challenges from delays in program launches and ramps, particularly in China, and a delayed launch with a European OEM that also reduced expected expansion to additional car lines. Aptiv PLC (NYSE:APTV) experienced a 120 basis point decline in intelligent systems EBITDA margin, impacted by investments in non-auto markets and stranded costs from the Vestigen spin-off. The company's software and services business saw a $50 million reduction in enterprise sales due to timing, leading to a softer Q3 and higher decremental margins in the second half. Aptiv PLC (NYSE:APTV) acknowledged that it was not conservative enough in its assumptions, particularly around launches and ramps, and is incorporating additional conservatism in the second half of the year. The company's automotive revenue declined 1% in Q2, with Europe down 8% due to volume pressures with select luxury OEMs, and the outlook for vehicle production in the second half has turned from a tailwind to a headwind. Aptiv PLC (NYSE:APTV) is facing stranded costs following the Vestigen spin-off, which are impacting margins, though the company is aggressively working to eliminate them. Q: Can you share your thoughts behind the portfolio changes you indicated at the tail end of your prepared remarks? A: Kevin Clark (CEO): We don't have any specific comments to make at this point in time. Clearly, we are operating in a very dynamic market across regions and technologies. As we always do, we are evaluating our mix of products and portfolio to optimize and drive shareholder value. We will leave it at that for now. Q: You mentioned that even though Aptiv has been making good progress with bookings for Chinese domestic OEMs, not enough of those were on export vehicles. Can you talk more about that? A: Kevin Clark (CEO): We are very well positioned. Over the last couple of years, the focus was on getting a stronger mix with leading local OEMs. Today, our revenues in China on export platforms are about 10% of total. The mix is more heavily weighted to domestic platforms, but our bookings over the last two years show that percentage has significantly increased. Our revenues don't yet match the bookings mix, but we are making progress on that front. Q: On the change in guidance, the implied decremental seems pretty high at around 40%. Can you talk about the change in the EBITDA items? A: Varun Laroyia (CFO): The specific reason is product mix. The $50 million reduction in software revenue in the second half has a higher flow-through impact. Typically, the decremental would be less than that, but given the size of the software revenue reduction, the overall decremental for that period is higher. Q: You mentioned coming clean on not being conservative enough and building in more cushion. How are you changing your planning process for this uncertainty? A: Kevin Clark (CEO): As China becomes a bigger part of our revenue base and local OEMs become a bigger part of our mix, we need to apply a more significant haircut from a conservatism standpoint. The China domestic market is significantly weaker than it has been in years, with domestic retail sales down 20%. We assumed the government would step in with support, which was a mistake. We are now overlaying significantly more conservatism in our process. Q: On the non-automotive opportunities, you mentioned drones and robotics could approach $300 million in revenue. What does that mean for profitability? A: Kevin Clark (CEO): The margin profile is much higher than automotive. We are investing in non-automotive capabilities, but there is minimal capital investment since we use existing facilities and equipment. Both markets have much higher margin profiles than what we experience in the automotive industry. Q: Can you share segment-level color on the updated full-year guidance? A: Varun Laroyia (CFO): The revision in guidance is largely impacting the intelligent systems business. We expect intelligent systems to be approximately flat year-over-year on revenue, with engineered components growing in the low to mid-single digits. For margins, we expect intelligent systems EBITDA margins at mid-teens and engineered components at roughly 22% for the full year. Q: On the three buckets of changesschedule changes, delayed programs, and timingdo you have confidence the first two will come back in 2027? A: Kevin Clark (CEO): It's difficult to envision another year where the China local market is down 20%. However, European exports into China may not bounce back in 2027 due to competitiveness. For program delays, local China OEM launches will continue but at a slower slope. One BYD program we're confident will launch, just shifted. The European OEM program that was delayed is launching now and will be a tailwind into 2027. Q: On the bookings mix within intelligent systems, how much is full-stack including software versus modular? Has this changed with OEMs building internal capability? A: Kevin Clark (CEO): We're seeing more separation of software and hardware, creating more software opportunities. A significant portion of our 2026 bookings will be Gen 6 ADAS solutions, with the bulk including both hardware and software. We're seeing more OEMs come to us for software development in middleware and other areas. We have not seen a trend of OEMs insourcing; in fact, several OEMs who attempted broad-based software have decided to rely more on suppliers. Q: On the drone business, how quickly will it come into sales, and can you describe the 800-volt DC collaboration? A: Kevin Clark (CEO): For drones and robotics, awards this year will have revenues in 2027, typically about six months after award. On the energy storage/data center side, our portfolio is in and around power. The transition to 800-volt presents incremental opportunities. Today we have under $50 million in revenues there, but expect rapid growth over the next three years, mostly in power to the rack and now some in-rack capabilities. Q: On the quarterly cadence, there's a negative decremental in Q3 and then a big incremental into Q4. Is this all recovery-driven? A: Kevin Clark (CEO): There are three things: volume flow-through from Q2 to Q3, with software being higher margin; from Q3 to Q4, software bounces back with higher margins and volume pickup; and engineering credits and recoveries tend to be stronger in Q4. Q3 margin is impacted by timing on recoveries, making it artificially lower than expected. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Management attributed the guidance reduction to prolonged sales weakness in the domestic China market, where retail sales fell 20%, leading to reduced production schedules for local platforms. Performance was further pressured by luxury European OEMs reducing production schedules for vehicles exported to the China market due to shifting competitive dynamics. The company is aggressively diversifying its business mix, achieving 12% growth in non-automotive revenues during the quarter to mitigate traditional automotive volatility. Strategic positioning in robotics and drones is accelerating faster than anticipated, with management citing a 'time-to-market advantage' compared to the decade-long cycles in automotive. Operational resilience is being bolstered through digital twin and end-tier tracking capabilities, which management claims provides a step-change in supply chain visibility for customers. The business mix in China is shifting toward local OEMs, though current revenue still skews toward domestic platforms rather than the higher-growth export platforms secured in recent bookings. Full-year 2026 revenue guidance was lowered by $300 million, assuming continued weakness in China production and approximately $50 million in delayed enterprise software sales. Management has incorporated an 'additional element of conservatism' into second-half assumptions, particularly regarding the slope of new program launches and ramps in China. The company expects to achieve approximately $300 million in annual revenue from robotics and drone markets over the next few years, characterized by higher margin profiles than automotive. Capital allocation strategy includes returning approximately 50% of free cash flow to shareholders through share repurchases over the next few years, with 2026 repurchases expected to exceed this level. The Q4 outlook assumes a significant margin uptick driven by the timing of engineering recoveries, a bounce-back in software sales, and the lapping of prior-year supplier disruptions. The separation of the EDS segment is complete, and management is now focused on eliminating 'stranded costs' following the Versigent spin-off. A $70 million cash separation cost associated with the spin-off impacted second-quarter free cash flow. A supplier fire at a major North American customer created a year-over-year comparison headwind that is expected to unwind in the second half of 2026. Management flagged the lack of Chinese government stimulus as a factor in the domestic market's continued deterioration beyond initial expectations. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management maintained that the long-term view remains intact despite a dynamic environment where IHS has lowered vehicle production outlooks. Growth is expected to be increasingly driven by non-auto opportunities materializing faster than initially projected. The high decremental impact in the second half is primarily due to the $50 million timing shift in software sales, which carry significantly higher margins than hardware. Management expects these high-margin software revenues to return to double-digit growth levels in the fourth quarter. Aptiv is targeting 'nascent' industries where incumbents lack mature systems engineering and global supply chain capabilities. Management noted that pricing in these sectors is 'value-based' rather than 'cost-based,' supporting a superior margin profile compared to automotive. Management stated they have not seen a broad trend toward in-sourcing; instead, several OEMs that attempted internal software development are returning to suppliers. Bookings are trending toward a separation of software and hardware, with increased demand for Aptiv to provide middleware and full-stack solutions.

Aptiv PLC (APTV) came out with quarterly earnings of $1.63 per share, beating the Zacks Consensus Estimate of $1.42 per share. This compares to earnings of $2.12 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +14.79%. A quarter ago, it was expected that this company would post earnings of $1.62 per share when it actually produced earnings of $1.71, delivering a surprise of +5.56%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. APTIV PLC, which belongs to the Zacks Technology Services industry, posted revenues of $3.27 billion for the quarter ended June 2026, missing the Zacks Consensus Estimate by 1.37%. This compares to year-ago revenues of $5.21 billion. The company has topped consensus revenue estimates three times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. APTIV PLC shares have lost about 24.8% since the beginning of the year versus the S&P 500's gain of 11%. While APTIV PLC has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for APTIV PLC was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.59 on $3.36 billion in revenues for the coming quarter and $5.93 on $12.94 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Technology Services is currently in the bottom 40% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. BlackSky Technology Inc. (BKSY), another stock in the same industry, has yet to report results for the quarter ended June 2026. The results are expected to be released on August 6. This company is expected to post quarterly loss of $0.38 per share in its upcoming report, which represents a year-over-year change of +26.9%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. BlackSky Technology Inc.'s revenues are expected to be $29.76 million, up 34.1% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Aptiv PLC (APTV) : Free Stock Analysis Report BlackSky Technology Inc. (BKSY) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Aptiv PLC APTV reported mixed second-quarter 2026 results, with earnings beating the Zacks Consensus Estimate but revenues missing the same. APTV’s adjusted earnings of $1.63 per share topped the Zacks Consensus Estimate of $1.42 by 14.8% and increased 24.4% from the year-ago quarter, aided by stronger operating profitability, lower interest expense and a reduced share count. Revenues of $3.27 billion missed the consensus mark of $3.32 billion by 1.4% but rose 2.3% year over year. Adjusted revenue growth was 2%, while non-automotive revenues increased 12%. Aptiv PLC price-consensus-eps-surprise-chart | Aptiv PLC Quote The company reported results excluding its Electrical Distribution (EDS) segment, which completed its spin-off into a new publicly traded company, Versigent, on April 1, 2026. North American adjusted revenues advanced 10% despite flat regional vehicle production. Asia-Pacific revenues grew 6%, including a 5% increase in China, even as Chinese vehicle production declined 3%. Europe remained a headwind, with adjusted revenues falling 8% against a 1% production decline. Revenues in South America, Aptiv’s smallest region, decreased 4%. The regional results reflected strength in North America and Asia-Pacific, partly offset by weak European demand. Engineered Components revenues increased 4.8% year over year to $1.80 billion. Adjusted revenue growth was 3%, with automotive revenues flat and non-automotive revenues up 11%. North American demand was the primary growth driver. The segment’s adjusted EBITDA rose 17.5% to $403 million. Its adjusted EBITDA margin expanded to 22.4% from 21.4%, benefiting from higher volumes, operating execution and favorable timing of customer recoveries, despite stranded costs following the Electrical Distribution Systems spin-off. Intelligent Systems revenues were $1.50 billion, compared with $1.51 billion in the prior-year quarter. Adjusted revenues were flat as a 12% increase in non-automotive business and 10% growth in Software and Services were offset by a 3% decline in automotive revenues. Adjusted EBITDA decreased 8.3% to $210 million, while the segment margin contracted to 14% from 15.2%. Increased engineering investments and stranded costs more than offset performance initiatives during the quarter. Adjusted EBITDA increased 12.1% to $613 million. The adjusted EBITDA margin expanded 160 basis points to 18.7% on a continuing operations basis, supported by higher volumes and favorable foreign-currency effects, partly offset by increased commodity costs. Adjusted operating income rose 15.4% to $473 million, and the corresponding margin improved to 14.4% from 12.8%. GAAP operating income increased to $367 million from $325 million. Interest expense declined to $62 million from $92 million, while tax expense increased to $52 million from $16 million. Aptiv secured about $5 billion in new commercial awards, comprising $2.4 billion in Intelligent Systems and $2.5 billion in Engineered Components. The company won its first commercial Gen 8 Radar award and expanded into robotics through a perception-systems award. Non-automotive progress included robotics, drones, energy storage and commercial vehicles. Aptiv also reported a commercial drone win in July and continued collaborating with NVIDIA on production-ready edge Artificial Intelligence platforms. Software and Services growth further supported the company’s diversification beyond automotive markets. Cash provided by continuing operations totaled $137 million, down from $326 million a year ago. Free cash flow was $12 million compared with $219 million, reflecting capital expenditures and costs associated with separating the EDS business. Aptiv ended June with $761 million in cash and cash equivalents and $5.33 billion in long-term debt. The company repurchased 4.1 million shares for $250 million during the quarter, bringing first-half repurchases to $325 million. About $1.8 billion remained under its authorization. For the third quarter, Aptiv expects revenues to be in the range of $3.12-$3.22 billion. The Zacks Consensus Estimate for the same is pegged at $3.36 billion. APTV’s adjusted earnings are projected to be between $1.25 and $1.35 per share. The Zacks Consensus Estimate for the same is pegged at $1.59 per share. Its adjusted EBITDA is projected between $545 million and $575 million, with a margin of 17.7%. For 2026, revenues are forecast at $12.6-$12.8 billion, below the prior range of $12.8-$13.2 billion. The Zacks Consensus Estimate for the same is pegged at $12.94 billion. Adjusted earnings are expected between $5.60 and $5.80 per share compared with the previous outlook of $5.70-$6.10. The Zacks Consensus Estimate for the same is pegged at $5.93 per share. Customer-mix pressures, particularly in China, production changes, launch delays and software timing prompted the revised forecast. Currently, Aptiv carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Trane Technologies plc TT reported impressive second-quarter 2026 results. TT’s adjusted earnings of $4.31 per share outpaced the consensus mark by 0.9% and rose 11.1% from the year-ago quarter’s actual. TT’s total revenues of $6.35 billion surpassed the consensus mark by 2.9% and increased 6.4% year over year. Rollins, Inc. ROL posted unimpressive second-quarter 2026 results. ROL’s adjusted earnings of 32 cents per share missed the Zacks Consensus Estimate by 5.9% but rose 6.7% year over year. Total revenues of $1.08 billion fell short of the consensus estimate by 1.7% but increased 7.9% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Aptiv PLC (APTV) : Free Stock Analysis Report Rollins, Inc. (ROL) : Free Stock Analysis Report Trane Technologies plc (TT) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Aptiv PLC (NYSE:APTV) reported second-quarter 2026 results that exceeded Wall Street earnings expectations, but its shares fell nearly 4% in pre-market trading after the company issued weaker-than-expected guidance for both the third quarter and the full year. While quarterly performance was solid, investors focused on the softer outlook. Aptiv posted adjusted earnings of $1.63 per share for the second quarter, comfortably ahead of the analyst consensus estimate of $1.42. Revenue totalled $3.3 billion, matching market expectations and representing a 2% increase from the $3.2 billion reported in the same period last year. The results reflected improving operating performance despite a challenging automotive market. The company’s forward outlook disappointed investors. For the third quarter, Aptiv expects adjusted earnings of between $1.25 and $1.35 per share, with the midpoint of $1.30 well below the analyst consensus estimate of $1.60. Third-quarter revenue is projected to range from $3.12 billion to $3.22 billion, with a midpoint of $3.17 billion compared with the market expectation of approximately $3.3 billion. For fiscal 2026, Aptiv forecasts adjusted earnings of $5.60 to $5.80 per share, below the analyst consensus midpoint, while full-year revenue is expected to range from $12.6 billion to $12.8 billion, also below market forecasts. Chair and Chief Executive Officer Kevin Clark said the company continued to deliver solid operational performance despite ongoing macroeconomic challenges. “We delivered solid results in the second quarter, our first as New Aptiv, with a reacceleration in revenue growth and margin expansion year-over-year,” said Kevin Clark, chair and chief executive officer. “While the macroeconomic landscape for Automotive remains dynamic and customer mix has presented as an incremental headwind, we remain committed to delivering continued revenue growth and strong operating performance this year.” Adjusted EBITDA increased to $613 million during the quarter from $547 million a year earlier. Adjusted EBITDA margin expanded to 18.7%, compared with 17.1% in the second quarter of 2025, reflecting improved operational efficiency. During the quarter, Aptiv completed the spin-off of its Electrical Distribution Systems business. The company also received a $1.9 billion cash dividend related to the transaction. In addition, Aptiv repurchased 4.1 million shares for $250 million during the second quarter as part of its ongoing capital return programme. Aptiv stock price

Interested in Aptiv PLC? Here are five stocks we like better. Aptiv lowered its full-year outlook after second-quarter revenue rose 2% to $3.3 billion, with weaker China production schedules and delayed program launches expected to reduce revenue by approximately $300 million. Performance varied by segment and region: non-automotive revenue grew 12% and Engineered Components expanded margins, while automotive revenue fell 1% and Intelligent Systems margins declined amid customer-mix headwinds and investment costs. Aptiv reported $5 billion in second-quarter awards and highlighted faster-growing opportunities in robotics, drones, aerospace, defense and energy storage, including a drone program expected to generate more than $500 million in lifetime revenue. 3 Stocks Powering the Future of Autonomous Driving Aptiv (NYSE:APTV) reported second-quarter results that included 2% adjusted revenue growth and 10 basis points of adjusted EBITDA margin expansion, while lowering its full-year outlook amid weaker automotive production schedules in China and delayed program launches. Chair and CEO Kevin Clark said the company continues to see long-term opportunity in automotive technology and adjacent markets, but near-term conditions in its traditional automotive business have become more challenging. He cited prolonged weakness in China’s domestic vehicle market, lower production schedules from local Chinese manufacturers, and reduced schedules from luxury European automakers exporting vehicles to China. → SpaceX’s First Earnings Report Could Decide Whether Shorts or Bulls Have Control 3 GARP Stocks Offering Strong Growth: Aptiv, Allstate, Barrick “We continue to contend with challenges in our traditional automotive market,” Clark said, adding that Aptiv is working to diversify its revenue mix both within and outside automotive markets. Aptiv generated second-quarter revenue of $3.3 billion, up 2% on an adjusted basis and slightly below the midpoint of its guidance. Adjusted EBITDA totaled $613 million, while adjusted EBITDA margin increased 10 basis points. Earnings per share were $1.63, up $0.12 from New Aptiv pro forma results in the second quarter of 2025. → Financials Hit Record Highs as the AI Trade Unravels—Can They Keep Leading? Mobileye Global: CEO Makes $10 Million Bet on Future Strength Regional performance was mixed. North American revenue increased 10%, supported by growth in both business segments. Revenue in Europe declined 8%, largely reflecting volume pressure among select luxury OEM customers, primarily in the Intelligent Systems segment. Asia-Pacific revenue rose 6%, including 5% growth in China, where improved local-OEM mix partly offset slowing production for the domestic market. Free cash flow was an outflow of $33 million in the quarter, including roughly $70 million in cash separation costs associated with the Versigent spinoff, according to Chief Financial Officer Varun Laroyia. Non-automotive revenue grew 12% during the quarter. Automotive revenue declined 1%, as customer-mix headwinds offset non-automotive growth. Intelligent Systems revenue was flat at $1.5 billion, while its adjusted EBITDA margin declined 120 basis points due to investments in non-automotive markets and stranded costs. Engineered Components revenue rose 3% to $1.8 billion, and its adjusted EBITDA margin increased 100 basis points. → Why Rare Earth Processing Could Be the Real 2027 Opportunity Laroyia said Engineered Components benefited from double-digit non-automotive growth, particularly in diversified industrial, aerospace and defense markets. The segment’s margin improvement reflected volume flow-through, the timing of recoveries and performance initiatives, partially offset by stranded costs. Aptiv reduced its full-year revenue outlook by $300 million at the midpoint. The company now expects 2026 revenue of $12.6 billion to $12.8 billion, representing adjusted growth of 2% at the midpoint. It projected adjusted EBITDA of $2.31 billion to $2.37 billion, adjusted earnings per share of $5.60 to $5.80, and free cash flow of $625 million to $725 million. The company expects third-quarter adjusted revenue growth of 1% at the midpoint, adjusted EBITDA of $560 million, an adjusted EBITDA margin of 17.7%, and earnings per share of $1.30. Laroyia outlined three primary drivers of the full-year revenue reduction: About $150 million from revised customer production schedules, chiefly tied to weakness in China’s domestic market and lower schedules for European OEMs exporting to China. About $100 million from delayed program launches and slower production ramps, including certain China programs and a delayed European OEM launch. About $50 million from the timing of enterprise software and services sales. The Intelligent Systems business was disproportionately affected by those factors. For the full year, Laroyia said Aptiv expects Intelligent Systems revenue to be approximately flat year over year, while Engineered Components revenue is expected to grow in the low- to mid-single digits. He said the company expects full-year EBITDA margins in the mid-teens for Intelligent Systems and around 22% for Engineered Components. Clark acknowledged that the company had not been conservative enough in assumptions surrounding launches and ramps. He said Aptiv is increasing its discounting of production schedules, particularly as Chinese local OEMs become a larger share of its business. Clark said domestic retail sales in China were down 20%, describing the market as significantly weaker than it has been in several years. Aptiv reported $5 billion in new business awards during the second quarter, bringing year-to-date awards to $10 billion and keeping the company on track for its $20 billion full-year target. In automotive, the company cited a Gen 8 Radar award from Volvo Cars for a next-generation software-defined vehicle platform, an award involving a large North American OEM’s next-generation vehicle architecture, and additional high-voltage bus bar business in North America and China. Aptiv also launched a next-generation digital cockpit program for a luxury European OEM and introduced an AI and machine-learning-based occupancy classification system using an in-cabin camera. The company emphasized that its non-automotive businesses are growing faster than expected. Aptiv launched high-performance interconnect programs for utility-scale energy storage and expanded work with commercial vehicle, aerospace, defense, solar and battery-storage customers. It also extended partnerships with NVIDIA for production-grade software used by edge-AI customers and with Kyndryl for Wind River software deployments in mission-critical systems. Clark said Aptiv has established partnerships with three robotics manufacturers, with one developing into a meaningful commercial agreement. In July, the company received its first commercial drone award from a leading manufacturer, with lifetime revenue expected to exceed $500 million over a five-year program. That award will be included in third-quarter bookings. Aptiv expects annual revenue from robotics and drones to reach roughly $300 million over the next several years. Clark said the sectors offer faster paths to revenue than automotive, with revenue from 2026 robotics and drone awards expected to begin in 2027. He also said the margin profile in those markets is higher than in automotive and requires limited capital investment because Aptiv can use existing facilities and equipment. Aptiv repurchased $250 million of shares during the second quarter, bringing year-to-date repurchases to $325 million. The company intends to repurchase a similar amount in the second half, targeting more than $600 million for the full year. Clark said Aptiv plans to return approximately half of its free cash flow to shareholders through repurchases over the next several years, while continuing to pursue smaller bolt-on acquisitions intended to diversify the business. He also said the company will continue evaluating its portfolio to maximize shareholder value following the completed separation of EDS. Aptiv plc is a global automotive technology company that develops safer, greener and more connected solutions for the mobility industry. The company designs and supplies advanced electrical architectures, electronic systems and software that enable vehicle connectivity, active safety, advanced driver-assistance systems (ADAS) and autonomous driving capabilities. Aptiv's customers include major automakers and mobility service providers seeking to integrate higher levels of automation, electrification and software-defined features into production vehicles and mobility platforms. Product and service offerings span vehicle electrical systems and wiring, connectors and harnesses, high-voltage electrification components, power electronics and charging solutions, sensors and compute platforms that support ADAS and autonomous functions, and the software and services required to integrate and manage these systems. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Aptiv Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Track your investments for FREE with Simply Wall St, the portfolio command center trusted by over 7 million individual investors worldwide. Aptiv (APTV) is drawing fresh attention as investors look ahead to its upcoming second quarter 2026 report. Expectations center on weaker revenue and earnings, with supply chain issues and customer mix under scrutiny. See our latest analysis for Aptiv. Aptiv's share price has drifted lower in recent months, with a 30 day share price return of 6.32% and a year to date share price decline of 28.01%, even though the 1 year total shareholder return is slightly positive at 1.54%. Recent focus on supply chain pressure, customer mix and shifting earnings estimates has kept attention on risk and profitability rather than short term momentum. If you are comparing Aptiv with other auto and technology names, it can help to see where capital is moving in adjacent themes, including robotics and factory automation via the 36 robotics and automation stocks Aptiv now trades at a steep discount to both analyst targets and some intrinsic value estimates after a difficult run and weaker outlook. Is that discount compensation for real business risk, or has sentiment pushed the stock too far? Aptiv's most followed narrative points to a fair value of $78.21 compared with the recent share price of $56.47, which frames the current discount as unusually wide. Read the complete narrative. Curious how a company with shrinking expected revenue can still support such a high earnings path and margin reset. The narrative hinges on this contrast. Result: Fair Value of $78.21 (UNDERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, the Aptiv story could shift quickly if weaker global vehicle production or tougher competition in areas like active safety and cockpit systems affects results more than analysts expect. Find out about the key risks to this Aptiv narrative. While the Simply Wall St DCF model points to Aptiv trading about 58.2% below an estimated fair value of $135.04, the current market P/E of 32.7x tells a different story compared to the Auto Components industry on 20x and peers on 19.7x. Is Aptiv cheap on cash flows yet expensive on earnings? Look into how the SWS DCF model arrives at its fair value. With mixed signals around Aptiv's valuation and outlook, it makes sense to move quickly and test the assumptions against your own research. You can weigh the potential upside against the concern areas by reviewing the company's 3 key rewards and 3 important warning signs If Aptiv has sharpened your focus on value and risk, do not stop here. Use curated screeners to spot other opportunities before the crowd catches on. Target potential bargains by checking companies that screen well on quality and valuation filters through the 55 high quality undervalued stocks. Prioritize resilience by reviewing stocks that show strong financial footing using the solid balance sheet and fundamentals stocks screener (45 results). Hunt for less crowded opportunities by scanning the screener containing 19 high quality undiscovered gems before others pay attention. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include APTV. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]