VISTEON CORP

Previous wording

•Technology Innovation- The Company is an established global leader in cockpit electronics and is positioned to provide solutions as the industry transitions to the next generation automotive cockpit experience. The cockpit is becoming fully digital, connected, automated, learning and voice enabled. Visteon's broad portfolio of digital cockpit and electrification electronics positions Visteon to support these macro trends in the automotive industry.

Current wording

•Technology Innovation- The Company is an established global leader in cockpit electronics and is positioned to provide solutions as the industry transitions to the next generation automotive cockpit experience. The cockpit is becoming fully digital, connected, automated, and voice enabled. Visteon's broad portfolio of digital cockpit and electrification electronics positions Visteon to support these macro trends in the automotive industry.

Previous wording

•Balanced Capital Allocation with a Strong Balance Sheet - The Company continues to maintain a strong balance sheet to withstand near-term industry volatility and support a balanced capital allocation framework. The Company is primarily focused on allocating capital to high-returning organic initiatives that increase internal capabilities, pursuing attractive inorganic opportunities, and returning capital to shareholders. In March 2023, the Company announced a $300 million share repurchase program maturing at the end of 2026. The Company has repurchased $176 million of Company common stock under this program. On July 22, 2025, the company declared a $0.275 quarterly cash dividend. During the six months ended June 30, 2025, Visteon spent a net cash outlay of $50 million on inorganic growth, to acquire a user experience electronics engineering consulting and consumer research company.

Current wording

•Balanced Capital Allocation with a Strong Balance Sheet - The Company continues to maintain a strong balance sheet to withstand near-term industry volatility and support a balanced capital allocation framework. The Company is primarily focused on allocating capital to high-returning organic initiatives that increase internal capabilities, pursuing attractive inorganic opportunities, and returning capital to shareholders. In March 2023, the Company announced a $300 million share repurchase program maturing at the end of 2026. The Company has repurchased $176 million of Company common stock under this program. On July 22, 2025, the Company declared a $0.275 quarterly cash dividend per share. On October 16, 2025, the Company declared a $0.275 quarterly cash dividend per share. During the nine months ended September 30, 2025, Visteon paid a net cash outlay of $50 million on inorganic growth, to acquire a user experience electronics engineering consulting and consumer research company.

Previous wording

The pie charts below highlight the net sales breakdown for Visteon for the three and six months ended June 30, 2025.

Current wording

The pie charts below highlight the net sales breakdown for Visteon for the three and nine months ended September 30, 2025.

Previous wording

Looking ahead, S&P's latest forecast assumes that global production will increase slightly for the full year 2025 compared to prior year. Visteon’s customer vehicle production is anticipated to decline by a mid-single-digit percentage. The impact of recently implemented tariffs on the automotive industry remains uncertain with the potential to increase production costs and weigh on future vehicle volumes.

Current wording

For the full year 2025, S&P Global currently expects global light-vehicle production to increase slightly compared to 2024, while production volumes for the Company’s key customers are anticipated to decline by a low-single-digit percentage. Market conditions remain mixed across regions, with retail demand in the United States remaining robust while Europe continues to experience headwinds. In the fourth quarter, several factors may impact industry production volumes, including continued downtime at JLR, trade restrictions impacting a certain discrete semiconductor supplier, and a recent fire at an aluminum supplier. The impact of recently implemented tariffs on the automotive industry remains uncertain, with the potential to increase production costs and weigh on future vehicle volumes; however, the effects have been minimal to date.

Previous wording

The industry continues to face ongoing risks related to tariffs, vehicle affordability, economic uncertainty, potential geopolitical challenges, and customer market share changes. While there was a not a meaningful impact to Visteon’s operations during the second quarter of 2025 related to tariffs, the impact on future quarters' financial statements, results of operations, and cash flows will be dependent on tariff dynamics, plant production schedules, supply chain impacts, and electric vehicle adoption.

Current wording

The industry continues to face ongoing risks related to tariffs, vehicle affordability, economic uncertainty, geopolitical developments, production disruptions, and changes in customer market share. The potential impact on future periods’ financial statements, results of operations, and cash flows will depend on the evolution of tariff policies, plant production schedules, supply-chain conditions, and the pace of EV adoption.

Previous wording

Net sales for the three months ended June 30, 2025 totaled $969 million, representing a decrease of $45 million compared with the same period of 2024. Volumes and net new business decreased net sales by $24 million primarily due to lower customer production volumes, partially offset by recent product launches. Customer pricing decreased net sales by $35 million as a result of annual price reductions and lower customer recoveries due to improving supply chain dynamics. Favorable currency increased net sales by $4 million, primarily attributable to the euro, Japanese yen, and Thai baht, offset by the Brazilian real. Other cost performance, design changes and other increased net sales by $10 million, primarily due to design changes, one-time commercial items, and sales from the recently acquired engineering services companies.

Current wording

Net sales for the three months ended September 30, 2025 totaled $917 million, representing a decrease of $63 million compared with the same period of 2024. Volumes and net new business decreased net sales by $65 million. Customer pricing decreased net sales by $36 million as a result of annual price reductions and lower customer recoveries due to improving supply chain dynamics. Favorable currency increased net sales by $10 million, primarily attributable to the euro and Thai baht, partially offset by the Indian rupee. Other cost performance, design changes and other increased net sales by $28 million primarily due to one-time items and sales from the recently acquired engineering services companies.

Previous wording

Cost of sales decreased by $57 million for the six months ended June 30, 2025 compared with the same period in 2024. Net engineering costs, excluding currency, increased cost of sales by $2 million. Foreign currency decreased cost of sales by $10 million, primarily attributable to the Brazilian real and the euro. Cost performance, design changes and other decreased cost of sales by $46 million primarily due to manufacturing and operational efficiencies.

Current wording

Cost of sales decreased by $63 million for the three months ended September 30, 2025 compared with the same period in 2024. Volume, mix and net new business decreased cost of sales by $54 million. Net engineering costs, excluding currency, increased cost of sales by $12 million. Foreign currency increased cost of sales by $5 million, primarily attributable to the euro and Thai baht. Cost performance, design changes and other decreased cost of sales by $26 million primarily due to operational efficiencies.

Previous wording

Gross engineering costs relate to forward model program development and advanced engineering activities and exclude contractually reimbursable engineering costs. Net engineering costs were $52 million and $50 million for the three months ended June 30, 2025 and 2024, respectively, and includes engineering costs related to recent acquisitions. This increase is primarily due to recent engineering services acquisitions, partially offset by lower personnel costs and timing of engineering recoveries.

Current wording

Gross engineering costs relate to forward model program development, advanced engineering activities and services. Net engineering costs were $58 million and $47 million for the three months ended September 30, 2025 and 2024, respectively. The increase is primarily due to recent engineering services acquisitions.

Previous wording

Selling, general, and administrative expenses were $48 million and $49 million, during the three months ended June 30, 2025 and 2024, respectively. Expenses decreased during the three months ended June 30, 2025 as compared to same period prior year due to lower bad debt expense, partially offset by employee expenses.

Current wording

Selling, general, and administrative expenses were $53 million and $51 million, during the three months ended September 30, 2025 and 2024, respectively. Expenses increased during the three months ended September 30, 2025 as compared to the same period prior due to higher incentive compensation expense and elevated IT costs associated with system investments, partially offset by lower bad debt expense.

Previous wording

During the six months ended June 30, 2025 and 2024 the Company recorded $1 million and $3 million of net restructuring expense, respectively. These expenses are primarily related to employee severance.

Current wording

During the three months ended September 30, 2025 and 2024 the Company recorded $3 million and $28 million of net restructuring expense, respectively. These expenses are primarily related to employee severance. The decrease is primarily related to a restructuring program approved in September 2024.

Previous wording

Interest income for the three months ended June 30, 2025 increased by $2 million as compared to the same period of 2024 due to higher interest rates on increased cash balances.

Current wording

Interest income for the three months ended September 30, 2025 increased by $3 million as compared to the same period of 2024 due to higher interest rates on increased cash balances.

Previous wording

Equity in net income of non-consolidated affiliates was income of $2 million and zero for the three months ended June 30, 2025 and 2024, respectively. The increased income is due to increased net operating profits at affiliates.

Current wording

Equity in net income of non-consolidated affiliates was income of $1 million and a loss of $3 million during the three months ended September 30, 2025 and 2024, respectively. The increased income is due to increased net operating profits at affiliates.

Previous wording

Other income, net was $2 million and $5 million for the six month period ending June 30, 2025 and 2024, respectively. The decrease was primarily due to lower net pension financing benefits and an increase in business acquisition costs.

Current wording

Other income, net was $2 million for the three month period ending September 30, 2025 and 2024. Other income, net consisted primarily of net pension financing benefits offset by business acquisition costs.

Previous wording

The Company's provision for income taxes of $56 million for the six months ended June 30, 2025 represents an increase of $12 million compared with $44 million in the same period of 2024. The increase in tax expense is primarily attributable to higher pretax income, as well as changes in the geographic mix of earnings and differing tax rates between jurisdictions. Additionally, the increase reflects higher withholding taxes, largely attributable to unfavorable foreign exchange movements.

Current wording

The Company's provision for income taxes of $22 million for the three months ended September 30, 2025 represents an increase of $11 million compared with $11 million in the same period of 2024. The $11 million increase in income tax expense was primarily driven by the non-recurrence of a $7 million valuation allowance release related to the Company’s German operations in the prior year period. The remaining increase primarily reflects higher pretax income, including changes in the geographic mix of earnings and the impact of varying tax rates across jurisdictions.

Previous wording

The Company's consolidated results of operations for the six months ended June 30, 2025 and 2024 were as follows:

Current wording

The Company's consolidated results of operations for the nine months ended September 30, 2025 and 2024 were as follows:

Previous wording

Net sales for the six months ended June 30, 2025 totaled $1,903 million, representing a decrease of $44 million compared with the same period of 2024. Customer pricing decreased net sales by $70 million as a result of annual price reductions and lower customer recoveries due to improving supply chain dynamics. Unfavorable currency decreased net sales by $16 million, primarily attributable to the Brazilian real and Indian rupee, offset by the Thai baht. Other cost performance, design changes and other increased net sales by $40 million primarily due to design changes, one-time commercial items, and sales from the recently acquired engineering services companies.

Current wording

Net sales for the nine months ended September 30, 2025 totaled $2,820 million, representing a decrease of $107 million compared with the same period of 2024. Customer pricing decreased net sales by $106 million as a result of annual price reductions and lower customer recoveries due to improving supply chain dynamics. Unfavorable currency decreased net sales by $6 million, primarily attributable to the Brazilian real and Indian rupee, partially offset by the euro and Thai baht. Other cost performance, design changes and other increased net sales by $68 million primarily due to one-time items and sales from the recently acquired engineering services companies.

Previous wording

Cost of sales decreased by $39 million for the three months ended June 30, 2025 compared with the same period in 2024. Volume, mix and net new business decreased cost of sales by $19 million. Net engineering costs, excluding currency, increased cost of sales by $3 million. Foreign currency increased cost of sales by $3 million, primarily attributable to the Japanese yen, Thai baht, and Mexican peso, offset by the Brazilian real. Cost performance, design changes and other decreased cost of sales by $26 million primarily due to manufacturing and operational efficiencies.

Current wording

Cost of sales decreased by $120 million for the nine months ended September 30, 2025 compared with the same period in 2024. Volume, mix and net new business decreased cost of sales by $53 million. Net engineering costs, excluding currency, increased cost of sales by $10 million. Foreign currency decreased cost of sales by $5 million, primarily attributable to the Brazilian real, partially offset by the Thai baht and Japanese yen. Cost performance, design changes and other decreased cost of sales by $72 million primarily due to operational efficiencies.

Previous wording

Gross engineering costs relate to forward model program development and advanced engineering activities and exclude contractually reimbursable engineering costs. Net engineering costs of $104 million for the six months ended June 30, 2025, including the impacts of currency, were $6 million lower than the same period of 2024. This decrease is primarily related to the favorable timing of recoveries and lower personnel costs, partially offset by engineering expenses related to recent acquisitions.

Current wording

Gross engineering costs relate to forward model program development, advanced engineering activities and services. Net engineering costs of $162 million for the nine months ended September 30, 2025, including the impacts of currency, were $5 million higher than the same period of 2024. The increase is primarily due to recent engineering services acquisitions, partially offset by favorable timing of recoveries.

Previous wording

Selling, general, and administrative expenses were $95 million and $101 million, during the six months ended June 30, 2025 and 2024, respectively. Expenses decreased during the six months ended June 30, 2025 as compared to same period prior year due to lower bad debt expense and employee expenses.

Current wording

Selling, general, and administrative expenses were $148 million and $152 million, during the nine months ended September 30, 2025 and 2024, respectively. Expenses decreased during the nine months ended September 30, 2025 as compared to same period prior year due to lower bad debt expense, partially offset by higher incentive compensation expense and elevated IT costs associated with system investments.

Previous wording

Interest, net, for the six months ended June 30, 2025 increased by $3 million as compared to the same period of 2024 due to higher interest rates on increased cash balances.

Current wording

Interest, net, for the nine months ended September 30, 2025 increased by $6 million as compared to the same period of 2024 due to higher interest rates on increased cash balances.

Previous wording

Equity in net income of non-consolidated affiliates was income of $4 million and a loss of $4 million for the six months ended June 30, 2025 and 2024, respectively. The increased income is due to increased net operating profits at affiliates.

Current wording

Equity in net income of non-consolidated affiliates was income of $5 million and a loss of $7 million for the nine months ended September 30, 2025 and 2024, respectively. The increased income is due to increased net operating profits at affiliates.

Previous wording

Other income, net was $1 million and $3 million for the three month period ending June 30, 2025 and 2024, respectively. The decrease was primarily due to lower net pension financing benefits and an increase in business acquisition costs.

Current wording

Other income, net was $4 million and $7 million for the nine month period ending September 30, 2025 and 2024, respectively. The decrease was primarily due to lower net pension financing benefits and an increase in business acquisition costs.

Previous wording

The Company's provision for income taxes of $28 million for the three months ended June 30, 2025 represents an increase of $3 million compared with $25 million in the same period of 2024. The increase in tax expense reflects a higher forecasted effective tax rate, primarily driven by shifts in the geographic mix of earnings, jurisdictional tax rate differences, and increased withholding taxes due primarily to unfavorable exchange movements.

Current wording

The Company's provision for income taxes of $78 million for the nine months ended September 30, 2025 represents an increase of $23 million compared with $55 million in the same period of 2024. The $23 million increase in income tax expense

Previous wording

("GAAP") and does not purport to be a substitute for net income as an indicator of operating performance or cash flows from operating activities as a measure of liquidity. Adjusted EBITDA has limitations as an analytical tool and is not intended to be a measure of cash flow available for management's discretionary use, as it does not consider certain cash requirements such as interest payments, tax payments, and debt service requirements. The Company uses Adjusted EBITDA as a factor in incentive compensation decisions and to evaluate the effectiveness of the Company's business strategies. In addition, the Company's credit agreements use measures similar to Adjusted EBITDA to measure compliance with certain covenants.

Current wording

Adjusted EBITDA is presented as a supplemental measure of the Company's financial performance that management believes is useful to investors because the excluded items may vary significantly in timing or amounts and/or may obscure trends useful in evaluating and comparing the Company's operating activities across reporting periods. Not all companies use identical calculations and, accordingly, the Company's presentation of Adjusted EBITDA may not be comparable to other similarly titled measures of other companies. Adjusted EBITDA is not a recognized term under U.S. generally accepted accounting principles ("GAAP") and does not purport to be a substitute for net income as an indicator of operating performance or cash flows from operating activities as a measure of liquidity. Adjusted EBITDA has limitations as an analytical tool and is not intended to be a measure of cash flow available for management's discretionary use, as it does not consider certain cash requirements such as interest payments, tax payments, and debt service requirements. The Company uses Adjusted EBITDA as a factor in incentive compensation decisions and to evaluate the effectiveness of the Company's business strategies. In addition, the Company's credit agreements use measures similar to Adjusted EBITDA to measure compliance with certain covenants.

Previous wording

The reconciliation of net income (loss) attributable to Visteon to Adjusted EBITDA for the six months ended June 30, 2025 and 2024, is as follows:

Current wording

The reconciliation of net income (loss) attributable to Visteon to Adjusted EBITDA for the nine months ended September 30, 2025 and 2024, is as follows:

Previous wording

Adjusted EBITDA was $263 million for the six months ended June 30, 2025, representing an increase of $25 million when compared to $238 million for the same period of 2024. Favorable impact of one-time items, cost performance and commercial discipline increased Adjusted EBITDA by $28 million. Foreign currency decreased Adjusted EBITDA by $5 million, primarily attributable to the Brazilian real and Indian rupee. Net engineering costs, excluding currency, increased Adjusted EBITDA by $2 million.

Current wording

Adjusted EBITDA was $382 million for the nine months ended September 30, 2025, representing an increase of $25 million when compared to $357 million for the same period of 2024. Cost performance, commercial discipline as well as the favorable impact of one-time items increased Adjusted EBITDA by $36 million. Foreign currency decreased Adjusted EBITDA by $1 million, primarily attributable to the Brazilian real and Indian rupee, partially offset by the euro. Net engineering costs, excluding currency, decreased Adjusted EBITDA by $10 million.

Previous wording

Access to additional capital through the debt or equity markets is influenced by the Company's credit ratings. As of June 30, 2025, the Company’s corporate credit rating is BB by Standard & Poor’s. See Note 9, "Debt" for a comprehensive discussion of the Company's debt facilities. Incremental funding requirements of the Company's consolidated foreign entities are primarily accommodated by intercompany cash pooling structures. Affiliate working capital lines, which may be utilized by the Company's local subsidiaries and consolidated joint ventures, had availability of $145 million and the Company had $400 million of available credit under the revolving credit facility, as of June 30, 2025.

Current wording

Access to additional capital through the debt or equity markets is influenced by the Company's credit ratings. As of September 30, 2025, the Company’s corporate credit rating has been upgraded from BB to BB+ by Standard & Poor’s reflecting improved financial strength. See Note 9, "Debt" for a comprehensive discussion of the Company's debt facilities. Incremental funding requirements of the Company's consolidated foreign entities are primarily accommodated by intercompany cash pooling structures. Affiliate working capital lines, which may be utilized by the Company's local subsidiaries and consolidated joint ventures, had availability of $147 million and the Company had $400 million of available credit under the revolving credit facility, as of September 30, 2025.

Previous wording

As of June 30, 2025, the Company had total cash and cash equivalents of $671 million, including $3 million of restricted cash and $82 million of cash attributable to the Company's joint venture partners should the Company elect to issue cash dividends.

Current wording

As of September 30, 2025, the Company had total cash and cash equivalents of $765 million, including $3 million of restricted cash and $93 million of cash attributable to the Company's joint venture partners should the Company elect to issue cash dividends.

Previous wording

Cash balances totaling $518 million were located in jurisdictions outside of the United States, of which approximately $115 million is considered permanently reinvested for funding ongoing operations outside of the U.S. If such permanently reinvested funds were repatriated to the U.S., no U.S. federal taxes would be imposed on the distribution of such foreign earnings due to U.S. tax reform enacted in December 2017. However, the Company would be required to accrue additional tax expense primarily related to foreign withholding taxes.

Current wording

Cash balances totaling $618 million were located in jurisdictions outside of the United States, of which approximately $205 million is considered permanently reinvested for funding ongoing operations outside of the U.S. If such permanently reinvested funds were repatriated to the U.S., no U.S. federal taxes would be imposed on the distribution of such foreign earnings due to U.S. tax reform enacted in December 2017. However, the Company would be required to accrue additional tax expense primarily related to foreign withholding taxes.

Previous wording

On July 22, 2025, the Company’s Board of Directors initiated a quarterly dividend subject to quarterly Board approval of $0.275 per share on its common stock. The dividend is payable on September 5, 2025, to shareholders of record as of the close of business on August 18, 2025. This action reflects the Company’s ongoing commitment to returning value to shareholders and is part of management’s broader capital allocation strategy.

Current wording

On July 22, 2025, the Company’s Board of Directors initiated a quarterly dividend subject to quarterly Board approval of $0.275 per share on its common stock. The dividend, totaling approximately $8 million, was paid on September 5, 2025, to shareholders of record as of the close of business on August 18, 2025. On October 16, 2025 the Company’s Board of Directors approved and declared a cash dividend of $0.275 per share on its common stock. The dividend is payable on December 5, 2025, to shareholders of record as of the close of business on November 18, 2025. These actions reflect the Company’s ongoing commitment to returning value to shareholders and is part of management’s broader capital allocation strategy.

Previous wording

During the six months ended June 30, 2025, cash contributions to the Company's defined benefit plans were $13 million related to its plans. The Company estimates that total cash contributions related to its defined benefit pension plans to be paid during the remainder of 2025 will be $7 million.

Current wording

During the nine months ended September 30, 2025, cash contributions to the Company's defined benefit plans were $22 million related to its plans. The Company estimates that total cash contributions related to its defined benefit pension plans to be paid during the remainder of 2025 will be $2 million.

Previous wording

During the six months ended June 30, 2025, the Company paid $6 million related to restructuring activities. Additional discussion regarding the Company's restructuring activities is included in Note 4, "Restructuring." The Company estimates that total cash restructuring payments through 2025 will approximate $20 million.

Current wording

During the nine months ended September 30, 2025, the Company paid $11 million related to restructuring activities. Additional discussion regarding the Company's restructuring activities is included in Note 4, "Restructuring." The Company estimates that total cash restructuring payments through 2025 will approximate $20 million.

Previous wording

The Company may be required to make significant cash outlays related to its unrecognized tax benefits, including interest and penalties. As of June 30, 2025, the Company had unrecognized tax benefits, including interest and penalties, that would be expected to result in a cash outlay of $18 million. Given the number of years, jurisdictions and positions subject to examination, the Company is unable to estimate the period of cash settlement, if any, with the respective taxing authorities.

Current wording

The Company may be required to make significant cash outlays related to its unrecognized tax benefits, including interest and penalties. As of September 30, 2025, the Company had unrecognized tax benefits, including interest and penalties, that would be expected to result in a cash outlay of $17 million. Given the number of years, jurisdictions and positions subject to examination, the Company is unable to estimate the period of cash settlement, if any, with the respective taxing authorities.

Previous wording

The Company generated $165 million and $126 million of cash inflows from operating activities during each of the six months ended June 30, 2025 and 2024, respectively. The increase is primarily attributable to higher Adjusted EBITDA and higher cash generated from working capital, partially offset by increased annual employee incentive payments and cash taxes.

Current wording

The Company generated $292 million and $224 million of cash inflows from operating activities during each of the nine months ended September 30, 2025 and 2024, respectively. The increase is primarily attributable to higher net income and higher working capital primarily as a result of increased cash collections from customers of $98 million, partially offset by increased annual employee incentive payments of $13 million and increased pension contributions of $10 million.

Previous wording

Net cash used by investing activities during the six months ended June 30, 2025 totaled $115 million, representing $43 million of increased usage as compared to the same period in 2024. This increase in cash used by investing activities is primarily due to the acquisition, net of cash acquired, of a user experience electronics engineering consulting and consumer research company of $50 million.

Current wording

Net cash used by investing activities during the nine months ended September 30, 2025 totaled $136 million, representing $12 million of decreased usage as compared to the same period in 2024. This decrease in usage is primarily due to lower capital expenditures of $8 million.

Previous wording

Cash used by financing activities during the six months ended June 30, 2025 was $38 million, representing a $2 million increase as compared to the same period in 2024. This increase is primarily attributable to increased dividends to non-controlling interests of $18 million offset by lower share repurchases as compared to 2024 of $13 million.

Current wording

Cash used by financing activities during the nine months ended September 30, 2025 was $52 million, representing a $12 million increase as compared to the same period in 2024. This increase is primarily attributable to increased dividends to non-controlling interests of $20 million and cash dividends paid to shareholders of $8 million, offset by lower share repurchases as compared to 2024 of $13 million.

Previous wording

•Uncertainties in U.S. policy regarding trade agreements, tariffs or other internation trade policies and any response to such actions by foreign countries.

Current wording

•Uncertainties in U.S. or foreign policy regarding trade agreements, tariffs or other internation trade policies and any response to such actions by foreign countries.

Previous wording

•Changes in laws, tariffs, regulations, policies or other activities of governments, agencies and similar organizations, domestic and foreign, that may tax or otherwise increase the cost of, prohibit, or otherwise affect, the manufacture, licensing, distribution, sale, ownership, or use of Visteon’s products or assets.

Current wording

•Changes in laws, tariffs, regulations, policies or other activities of governments, agencies and similar organizations, domestic and foreign, that may tax or otherwise increase the cost of, prohibit, or otherwise affect, the manufacture, licensing, distribution, sale, ownership, or use of Visteon’s or its supplier's products or assets.