VISTEON CORP

NOTE 1. Summary of Significant Accounting Policies

Basis of Presentation: Visteon Corporation (the "Company" or "Visteon") financial statements have been prepared in conformity with accounting principles generally accepted in the United States ("U.S. GAAP") on a going concern basis, which contemplates the continuity of operations, realization of assets, and satisfaction of liabilities in the normal course of business.

Principles of Consolidation: The consolidated financial statements include the accounts of the Company and subsidiaries over which it exerts control. Investments in affiliates over which the Company does not exercise control, but does have the ability to exercise significant influence over operating and financial policies, are accounted for using the equity method. All intercompany profits, transactions, and balances have been eliminated.

The Company determines whether the joint venture in which it has invested is a Variable Interest Entity (“VIE”) at the start of each new venture and when a reconsideration event has occurred. An enterprise must consolidate a VIE if it is determined to be the primary beneficiary of the VIE. The primary beneficiary has both the power to direct the activities of the VIE that most significantly impact the entity’s economic performance and the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant to the VIE.

Use of Estimates: The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect amounts reported herein. Considerable judgment is involved in making these determinations and the use of different estimates or assumptions could result in significantly different results. Management believes its assumptions and estimates are reasonable and appropriate. However, actual results could differ from those reported herein. Events and changes in circumstances arising after December 31, 2025 will be reflected in management's estimates for future periods.

Foreign Currency: We translate the assets and liabilities of foreign subsidiaries to United States (U.S.) dollars at end-of-period exchange rates. We translate the income statement elements of foreign subsidiaries to U.S. dollars at average-period exchange rates. We report the effect of translation for foreign subsidiaries that use the local currency as their functional currency as a separate component of stockholders' equity. Gains and losses resulting from the remeasurement of assets and liabilities in a currency other than the functional currency of a subsidiary are reported in current period income. We also report any gains and losses arising from transactions denominated in a currency other than the functional currency of a subsidiary in current period income. Net transaction gains and losses decreased net income by $3 million, $2 million, and $2 million for the years ended December 31, 2025, 2024, and 2023, respectively.

Revenue Recognition: The Company generates revenue from the production of automotive vehicle cockpit electronics parts sold to Original Equipment Manufacturers ("OEMs"), or Tier 1 suppliers at the direction of the OEM, under long-term supply agreements supporting new vehicle production. Such agreements may also require related production for service parts subsequent to initial vehicle production periods.

The Company’s contracts with customers consist of various governing documents (such as long-term supply agreements, master purchase agreements, purchase orders and customer release orders) which do not reach the level of a performance obligation of the Company until the Company receives either a purchase order and/or a customer release order for a specific number of parts at a specified price, at which point the collective group of documents represent an enforceable contract. While the long-term supply agreements generally range from three to five years, customers make no commitments to volumes, and pricing or specifications can change prior to or during production. The Company recognizes revenue when control of the parts produced are transferred to the customer according to the terms of the contract, which is usually when the parts are shipped or delivered to the customer’s premises. Customers are generally invoiced upon shipment or delivery and payment generally occurs within 30 to 90 days and does not include significant financing components. Customer returns, when they occur, relate to quality rework issues and are not connected to any repurchase obligation of the Company. As of December 31, 2025, all unfulfilled performance obligations are expected to be satisfied within the next twelve months, consistent with customary automotive production cycles.

Revenue is measured based on the transaction price and the quantity of parts specified in a contract with a customer. Discrete price adjustments may occur during the vehicle production period in order for the Company to remain competitive with market prices or based on changes in product specifications. Some of these price adjustments are non-routine in nature and require estimation. In the event the Company concludes that a portion of the revenue for a given part may vary from the purchase order, the Company records consideration at the most likely amount to which the Company expects to be entitled based on historical experience and input from customer negotiations. The Company records pricing accruals as adjustments to Net sales and Accounts receivable, net, within the Consolidated Statements of Operations and Consolidated Balance Sheets, respectively. In addition, the Company periodically negotiates cost recoveries with its customers. Recoveries are recorded as adjustments to Net sales when agreements with customers become contractual. The Company adjusts its pricing reserves at the earlier of when the most likely amount of consideration changes or when the consideration becomes fixed. Revenue recognized in 2025 related to performance obligations satisfied in prior periods was immaterial.

Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction that are collected by the Company from a customer are excluded from revenue. Shipping and handling costs associated with outbound freight after control of the parts has transferred to a customer are accounted for as a fulfillment cost and are included in Cost of sales.

Engineering Costs and Pre‑Production Activities: Engineering, testing, and other design and development costs incurred in connection with customer programs are expensed as incurred unless reimbursement is contractually guaranteed under a customer agreement. When reimbursement is contractually guaranteed, the related engineering costs are capitalized as contract assets on the Consolidated Balance Sheet and subsequently reduced upon receipt of lump‑sum or piece‑price recoveries from the customer.

Repair and maintenance costs, engineering and other pre‑production costs that are not contractually guaranteed for reimbursement are expensed as incurred and classified within Cost of Sales. Pre‑production costs expensed represent engineering activities that are not contractually guaranteed for recovery. Engineering expenses include salaries and related employee benefits, contractor fees, information technology, occupancy, telecommunications, depreciation and amortization, forward model program development, and advanced engineering activities. Engineering expenses were $220 million, $191 million, and $210 million in 2025, 2024, and 2023, respectively, including customer recoveries of $144 million, $143 million, and $120 million, respectively.

Restructuring Expense: Restructuring expense includes costs directly associated with exit or disposal activities. Such costs include employee severance and termination benefits, special termination benefits, and other exit or disposal costs. In general, the Company records involuntary employee-related exit and disposal costs when there is a substantive plan for employee severance and related costs are probable and estimable. For one-time termination benefits and employee retention costs, expense is recorded when the employees are entitled to receive such benefits and the amount can be reasonably estimated. Contract termination fees and penalties and other exit and disposal costs are generally recorded when incurred.

Debt Issuance Costs: The costs related to issuance or modification of long-term debt are deferred and amortized into interest expense over the life of each respective debt issue. Deferred amounts associated with debt extinguished prior to maturity are expensed upon extinguishment.

Net Earnings (Loss) Per Share Attributable to Visteon: Basic earnings (loss) per share is calculated by dividing net income (loss) attributable to Visteon by the average number of shares of common stock outstanding. Diluted earnings (loss) per share is computed by dividing net income (loss) attributable to Visteon by the average number of common and potential dilutive common shares outstanding after deducting undistributed income allocated to participating securities. Performance based share units are considered contingently issuable shares and are included in the computation of diluted earnings per share if their conditions have been satisfied as if the reporting date was the end of the contingency period.

Cash and Equivalents: The Company considers all highly liquid investments purchased with an original maturity of three months or less, including short-term time deposits, commercial paper, repurchase agreements, and money market funds to be cash and cash equivalents. As of December 31, 2025, the Company's cash balances are invested in a diversified portfolio of cash and highly liquid cash equivalents including money market funds and time deposits with highly rated banking institutions with maturities less than three months. The cost of such funds approximates fair value based on the nature of the investment.

Restricted Cash: Restricted cash represents amounts designated for uses other than current operations and includes $1 million and $2 million related to a Letter of Credit Facility as of December 31, 2025 and 2024, respectively. Restricted cash also represents amounts of $1 million related to cash collateral for other corporate purposes as of December 31, 2025 and 2024.

Accounts Receivable: Accounts receivable are stated at the invoiced amount, less an allowance for doubtful accounts for estimated amounts not expected to be collected, and do not bear interest.

The Company receives bank notes from certain customers in China to settle trade accounts receivable. The collection of such bank notes is included in operating cash flows based on the substance of the underlying transactions, which are operating in nature. Bank notes may be held until maturity, exchanged with suppliers to settle liabilities, or sold to third‑party financial institutions in exchange for cash.

Credit Loss Allowance: The Company establishes an allowance for doubtful accounts for accounts receivable based on the current expected credit loss impairment model (“CECL”). The Company applies a historical loss rate based on historic write-offs by region to aging categories. The historical loss rate will be adjusted for current conditions and reasonable and supportable forecasts of future losses, as necessary. The Company may also record a specific reservefor individual accounts when the Company becomes aware of specific customer circumstances, such as in the case of a bankruptcy filing or deterioration in the customer's operating results or financial position.

The allowance for doubtful accounts related to accounts receivable and related activity are summarized below:

Provision for estimated uncollectible accounts receivable are included in Selling, general and administrative expenses in the Company's Consolidated Statements of Operations.

Inventories: Inventories are stated at the lower of cost, determined on a first-in, first-out (“FIFO”) basis, or net realizable value. Cost includes the cost of materials, direct labor, in-bound freight and the applicable share of manufacturing overhead. The cost of inventories is reduced for excess and obsolete inventories based on management’s review of on-hand inventories compared to historical and estimated future sales and usage.

Product Tooling: Product tooling includes molds, dies, and other tools used in production of a specific part or parts of the same basic design owned either by the Company or its customers. Company owned tooling is capitalized and depreciated over the shorter of the expected useful life of the tooling or the term of the supply arrangement, generally not exceeding five years. The Company had receivables of $35 million and $29 million as of December 31, 2025 and 2024, respectively, related to product tools which will not be owned by the Company and for which there is a contractual agreement for reimbursement from the customer.

Property and Equipment: Property and equipment is stated at cost, or if impaired at fair value as of the impairment date. Property and equipment is depreciated using the straight-line method of depreciation over the related asset's estimated useful life.

Asset impairment charges are recorded for assets held-in-use when events and circumstances indicate that such assets may not be recoverable and the undiscounted net cash flows estimated to be generated by those assets are less than their carrying amounts. If estimated future undiscounted cash flows are not sufficient to recover the carrying value of the assets, an impairment charge is recorded for the amount by which the carrying value of the assets exceeds fair value. Fair value is determined using appraisals, management estimates, or discounted cash flow calculations.

Leases: The Company determines if an arrangement is a lease at contract inception. Right-of-use ("ROU") assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent its obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company's leases do not provide an implicit rate, the Company estimates the incremental borrowing rate to discount the lease payments based on information available at lease commencement. The Company's lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. Lease expense is recognized on a straight-line basis over the lease term. The Company has lease agreements containing lease and non-lease components which are accounted for as a single lease component.

Goodwill: Goodwill is tested for impairment annually as of October 1, or more frequently if events or changes in circumstances indicate a potential impairment. Goodwill is tested at the reporting unit level. Management performs a qualitative assessment that considers relevant factors, including overall financial performance, market conditions, and the Company’s market capitalization relative to carrying value. If this assessment indicates it is more likely than not that the reporting unit’s fair value is less than its carrying amount, the Company performs a quantitative impairment test. Under the quantitative test, the reporting unit’s fair value is compared to its carrying value, and an impairment loss is recognized for any excess of carrying value over fair value.

Intangible Assets: Definite-lived intangible assets are amortized over their estimated useful lives, and tested for impairment in

accordance with the methodology discussed above under "Property and Equipment."

Government Incentives: The Company receives certain incentives from governments primarily related to research and development programs. The Company records incentives in accordance with their purpose as a reduction of expense or an offset to the related property and equipment. The benefit is recorded when all conditions related to the incentive have been met or are expected to be met and there is reasonable assurance of their receipt. The Company recorded incentive benefits of $2 million for the years ended December 31, 2025 and 2024. The Company has deferred recognition of $1 million and $3 million as of December 31, 2025 and 2024, respectively, which will be recognized once all conditions are met.

Product Warranty and Recall: Amounts accrued for product warranty and recall claims are based on management’s best estimates of the amounts that will ultimately be required to settle such items. The Company’s estimates for product warranty and recall obligations are developed with support from its sales, engineering, quality, and legal functions and include consideration of contractual arrangements, past experience, current claims and related information, production changes, industry and regulatory developments and various other considerations. For further detail on warranty obligations see Note 19, "Commitments and Contingencies."

Income Taxes: Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The Company records a valuation allowance to reduce deferred tax assets when it is more likely than not that such assets will not be realized. This assessment requires significant judgment, and must be done on a jurisdiction-by-jurisdiction basis. The Company monitors the realizability of its deferred tax assets taking into account all relevant factors at each reporting period. In determining the need for a valuation allowance, all available positive and negative evidence, including historical and projected financial performance, is considered along with any other pertinent information. The Company valuation allowance assessment is based on its best estimate of future results considering all available information.

The Company operates in multiple jurisdictions throughout the world and the income tax returns of its subsidiaries in various tax jurisdictions are subject to periodic examination by respective tax authorities. The Company regularly assesses the status of these examinations and the potential for adverse and/or favorable outcomes to determine the adequacy of its provision for income taxes. The Company believes that it has adequately provided for tax adjustments that it believes are more likely than not to be realized as a result of any ongoing or future examination. Accounting estimates associated with uncertain tax positions requires the Company to make judgments regarding the sustainability of each uncertain tax position based on its technical merits. If the Company determines it is more likely than not a tax position will be sustained based on its technical merits, the Company records the largest amount that is greater than 50% likely of being realized upon ultimate settlement. These estimates are updated at each reporting date based on the facts, circumstances and information available. Due to the complexity of these uncertainties, the ultimate resolution may result in a payment that is materially different from the Company's current estimate of the liabilities recorded. Accrued interest and penalties related to unrecognized tax benefits are classified as income tax expense.

Value Added Taxes: The Company reports value added taxes collected from customers and remitted to government authorities, on a net basis within Cost of sales.

Financial Instruments: The Company periodically uses derivative financial instruments, including forward contracts, swaps, and options to manage exposures to changes in currency exchange rates and interest rates. The Company's policy specifically prohibits the use of derivatives for speculative or trading purposes.

Change in Accounting Principle

Assessing Realizability of U.S. Deferred Tax Assets Accounting Method Change

During the fourth quarter of 2025, the Company changed its accounting method for assessing the realizability of its deferred tax assets and resulting valuation allowance from the incremental cash tax savings method to the tax-law-ordering methodology. The Company has determined that the tax-law-ordering methodology is preferable because it provides greater transparency regarding utilization of existing attributes and prioritizes existing attributes over future attributes.

The change in approach, effective December 31, 2025, has been determined to be a change in accounting principle and the effects of the change have been applied and disclosed retrospectively. The effects of the change in accounting principle to the Company's Condensed Consolidated Financial Statements were as follows:

Accounting Pronouncements Not Yet Adopted

In November 2024, the FASB issued ASU No. 2024-03 (“ASU 2024-03”), Disaggregation of Income Statement Expenses (DISE) which requires disaggregated disclosure of income statement expenses for public business entities. The standard requires public business entities to disclose disaggregated information about specific natural expense categories underlying certain income statement expense line items that are considered relevant. The FASB also issued ASU No. 2025-01 (“ASU 2025-01”), Clarifying the Effective Date, which clarifies the adoption date of ASU 2024-03 as annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027 The Company is currently evaluating the potential effect of this accounting standard update on its consolidated financial statements and related disclosures.

In July 2025, the FASB issued ASU No. 2025-05 (“ASU 2025-05”), Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, which allows entities to use a simplified approach when estimating credit losses for current accounts receivable and contract assets arising from revenue transactions. The standard update permits consideration of collections after the balance sheet date when estimating expected credit losses, and allows consideration of subsequent collections when estimating credit losses, reducing documentation burden. The adoption of ASU 2025-05 is effective for annual and interim periods within annual reporting periods beginning after December 15, 2025. The Company is currently evaluating the potential effect of this accounting standard update on its consolidated financial statements and related disclosures.

In September 2025, the FASB issued ASU No. 2025-06 (“ASU 2025-06”), Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which modernizes outdated guidance on internal-use software costs to reflect current development practices and improve operability. The standard eliminates the project stages model and replaces with a principles based recognition threshold. The standard also creates a new capitalization criteria that clarifies capitalization when funding is authorized by management and is probable to be completed and used. The adoption of ASU 2025-06 is effective for annual and interim periods within annual reporting periods beginning after December 15, 2027. The Company is currently evaluating the potential effect of this accounting standard update on its consolidated financial statements and related disclosures.

In November 2025, the FASB issued ASU 2025-09, Derivatives and Hedging (Topic 815): Hedge Accounting Improvements ("ASU 2025-09"). ASU 2025-09 amends certain aspects of the existing hedge accounting guidance in ASC 815 to more closely align hedge accounting with the economics of an entity's risk management activities. ASU 2025-09 is effective for fiscal years beginning after December 15, 2026 and interim periods therein using prospective adoption. Early adoption is permitted. The Company is currently evaluating the potential effect of this accounting standard update on its consolidated financial statements and related disclosures.

In December 2025, the FASB issued ASU 2025-10, Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities ("ASU 2025-10"). ASU 2025-10 adds guidance on the recognition, measurement and presentation of government grants. ASU 2025-10 is effective for fiscal years beginning after December 15, 2028, including interim periods within those fiscal years, and permits modified prospective, modified retrospective, or full retrospective adoption. The Company is currently evaluating the impact of this guidance on its consolidated financial statements and related disclosures.

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements ("ASU 2025-11"). ASU 2025-11 is intended to improve the navigability of guidance in ASC 270, Interim Reporting, and clarify when it applies. The amendments also provide additional guidance on what disclosures should be provided in interim reporting periods. ASU 2025-11 is effective for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years, and permits prospective or full retrospective adoption. The Company is currently evaluating the impact of this guidance on its consolidated financial statements and related disclosures.

Recently adopted accounting pronouncements

In December 2023, the FASB issued ASU No. 2023-09 (“ASU 2023-09”), Income Taxes (Topic 740): Improvement to Income Tax Disclosures to enhance the transparency and decision usefulness of income tax disclosures. ASU 2023-09 is effective for annual periods beginning after December 15, 2024 on a prospective basis. Retrospective application to all periods presented and early adoption is permitted. The Company has adopted this standard prospectively, which is reflected in Note 14, "Income Taxes".

NOTE 2. Business Acquisition

On May 21, 2025, Visteon acquired all equity shares of a user experience electronics engineering consulting and consumer research company for cash of $55 million ("UX Acquisition") not including contingent consideration of up to $9 million to be paid if certain financial and operational milestones are achieved. The UX Acquisition will enhance the Company's ability to serve customers through product development and customer experiences.

The aggregate purchase price was allocated to the assets acquired and liabilities assumed as follows:

The UX Acquisition is accounted for as a business combination. The purchase price was recorded on a preliminary basis at estimated fair values, based on management's assessment as of May 21, 2025. These estimates relied on available information, reasonable and supportable assumptions, and when necessary, assistance from a third-party engaged by the Company.

During the measurement period, not to exceed one year from the acquisition date, the Company may adjust estimated or provisional amounts of assets and liabilities if new information is obtained related to facts and circumstances that existed as of the acquisition date. Measurement period adjustments are recorded in the period they are identified. As of December 31, 2025 adjustments were made based on updated information provided by management. These adjustments resulted in a decrease in the fair value of contingent consideration of $1 million, an increase in tradename of $2 million, an increase in customer-related assets of $1 million, an increase in deferred tax liability of $1 million, and a decrease in goodwill of $3 million when compared to the preliminary allocation. As of December 31, 2025 the final purchase price allocation has not been completed as the Company is still evaluating net working capital adjustments which may result in a change in total acquisition consideration.

Fair values for intangible assets were based on the income approach including excess earnings and relief from royalty methods. As of December 31, 2025, the Company recorded intangible assets including a tradename of $5 million and customer-related assets totaling $32 million. These definite-lived intangible assets are being amortized using the straight-line method over their estimated useful lives of 20 years for tradename and 16 years for customer-related assets. The fair value of contingent consideration was measured using a Monte Carlo simulation which is a financial model that utilizes the probabilities of various outcomes.

These fair value measurements are classified within level 3 of the fair value hierarchy.

The Company incurred $2 million in costs related to the UX Acquisition which are classified as Other income (expense), net on the Company's condensed consolidated statements of comprehensive income.

On August 29, 2024, Visteon acquired all equity shares of a German advanced design and R&D services company for cash of $54 million ("German Acquisition") not including contingent consideration of up to $13 million to be paid over a period not to exceed three years if certain financial and operational milestones are achieved. The German Acquisition has expanded and strengthened the Company's electronics offerings.

Certain measurement period adjustments have been made during the first three months of 2025. Such adjustments resulted in lower cash paid of $1 million and an increase in intangible assets of $1 million, resulting in a decrease to Goodwill of $2 million when compared from December 31, 2025 to December 31, 2024. As of March 31, 2025 the Company considered the purchase price allocation complete.

The contingent consideration liability is remeasured at fair value each reporting period, with changes recognized in earnings. During the year ended December 31, 2025, the Company recorded a decrease of less than $1 million in the contingent consideration liability related to the German Acquisition due to updated performance expectations.

The Company acquired an additional business in the fourth quarter of 2024 for cash consideration of $3 million which was allocated to Goodwill as of December 31, 2024. As of March 31, 2025, certain measurement period adjustments were made which resulted in an increase in fair value of intangible assets of $1 million. This measurement period adjustment resulted in a decrease in Goodwill of $1 million when compared to the balance as of December 31, 2024. As of March 31, 2025 the Company considered the purchase price allocation complete.

The pro forma effects of the UX Acquisition and German Acquisition do not materially impact the Company's reported results for any period presented, and as a result, no unaudited pro forma disclosures are included herein.

NOTE 3. Non-Consolidated Affiliates

A summary of the Company's investments in non-consolidated equity method affiliates is provided below:

Investments in Affiliates

Equity in net income of non-consolidated affiliates was income of $8 million and a loss of $3 million and $10 million for the years ended December 31, 2025, 2024, and 2023, respectively.

The Company monitors its investments in affiliates for indicators of other-than-temporary declines in value on an ongoing basis. If the Company determines that an other-than-temporary decline in value has occurred, an impairment loss will be recorded, measured as the difference between the carrying value and the fair value of the investment. As of December 31, 2025, the Company determined that no such indicators were present.

The Company's share of YFVIC reported losses are greater than the carrying value of this investment. Based on the equity method of accounting, losses exceeding the investment balance were not recorded and are monitored as suspended losses. As of December 31, 2025 and 2024, the total suspended loss attributable to YFVIC was $5 million and $3 million, respectively, for which the Company has no contractual obligation to fund.

During the second quarter of 2024, the Company loaned YFVIC $5 million to provide financial support. During the fourth quarter of 2024, YFVIC repaid the loan to the Company in full.

Non-Consolidated Affiliate Transactions

The Company has committed to make a $20 million investment in multiple entities principally focused on the automotive sector pursuant to limited partnership agreements. As a limited partner in each entity, the Company will periodically make capital contributions toward this total commitment amount. Through December 31, 2025, the Company had contributed approximately $15 million to these entities. These investments are classified as equity method investments.

A $7 million dividend was declared and paid by a non-consolidated affiliate during 2025.

Variable Interest Entities

The Company determined that YFVIC is a VIE. The Company holds a variable interest in YFVIC primarily related to its ownership interests and subordinated financial support. The Company and Yangfeng Automotive Trim Systems Co. Ltd., ("YF") each own 50% of YFVIC and neither entity has the power to control the operations of YFVIC; therefore, the Company is not the primary beneficiary of YFVIC and does not consolidate the joint venture.

A summary of transactions with affiliates is shown below:

A summary of the Company's investments in YFVIC is provided below:

NOTE 4. Restructuring

During the year ended December 31, 2025, 2024, and 2023, the Company recorded $8 million, $32 million, and $5 million, respectively, ofnet restructuring expense primarily related to employee severance.

Current restructuring actions include the following:

•During year ended December 31, 2025, the Company approved and recorded $8 million of net restructuring expense related to various global programs to improve efficiencies and rationalize the Company's footprint. As of December 31, 2025 the Company has $4 million accrued related to these actions and payments related to these programs are expected to be complete by the end of 2026.

•During September of 2024, the Company approved a global restructuring program impacting manufacturing and engineering facilities, as well as administrative functions to improve efficiency and further rationalize the Company’s footprint. As of December 31, 2025, $15 million remains accrued for the program and payments related to this program are expected to be complete by the end of 2026.

•During prior years, the Company approved various restructuring programs to improve efficiencies across the organization. As of December 31, 2025,$1 million remains accrued related to these previously announced actions.

•As of December 31, 2025, the Company retained restructuring reserves as part of the Company's divestiture of the majority of its global Interiors business (the "Interiors Divestiture") and legacy operations of $3 million associated with completed programs for the fundamental reorganization of operations at facilities in Brazil and France.

Restructuring Reserves

The Company’s restructuring reserves and related activity are summarized below. The Company anticipates that the activities associated with the current restructuring reserve balance will be substantially complete by the end of 2027. The Company’s condensed consolidated restructuring reserves are shown as Other liabilities as detailed in Note 10, "Other Liabilities".

NOTE 5. Inventories

Inventories, net consist of the following components:

NOTE 6. Other Assets

Other current assets are comprised of the following components:

Other non-current assets are comprised of the following components:

Contractual payments represent certain amounts associated with commercial arrangements that are capitalized and subsequently recognized over the period to which they relate.

Current and non-current contractually reimbursable engineering costs are related to pre-production design and development costs incurred pursuant to long-term supply arrangements that are contractually guaranteed for reimbursement by customers. The Company expects to receive payments of approximately $24 million in 2026, $12 million in 2027, $2 million in 2028, less than $1 million in 2029 and $2 million in 2030 and beyond.

NOTE 7. Property and Equipment

Property and equipment, net consists of the following:

Depreciation and product tooling amortization expenses are summarized as follows:

The net book value of capitalized internal use software costs was approximately $14 million and $7 million as of December 31, 2025 and 2024. respectively. Related amortization expense was approximately $7 million, $5 million and $3 million for the years ended 2025, 2024 and 2023, respectively.

Amortization expense related to internal use software expected for the future annual periods are as follows:

NOTE 8. Intangible Assets

Intangible assets consisted of the following:

The Company also owns developed technology assets which have a net balance of less than $1 million as of December 31, 2025 and 2024.

Capitalized software development consists of software development costs intended for integration into customer products.

Goodwill as of December 31, 2025 consisted of the following:

The Company recorded amortization expense of approximately $15 million, $12 million, and $19 million for the years ended December 31, 2025, 2024, and 2023, respectively, related to definite-lived intangible assets.

The Company currently estimates annual amortization expense to be as follows:

NOTE 9. Leases

The Company has operating leases primarily for corporate offices, technical and engineering centers, plants, vehicles, and certain equipment. As of December 31, 2025 and 2024 the Company had $7 million and $6 million of net assets recorded under finance leasing arrangements, respectively.

Certain of the Company's lease agreements include rental payments adjusted periodically primarily for inflation. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The Company subleases certain real estate to third parties primarily in the U.S., Germany, and Brazil.

For the years ended December 31, 2025 and 2024, the weighted average remaining lease term and discount rate for operating leases were 8 years years and 5.11% and 5 years and 4.90%, respectively. For the years ended December 31, 2025 and 2024, the weighted average remaining lease term and discount rate for financing leases were 38 years and 4.66% and 38 years and 4.65%, respectively.

The components of lease expense are as follows:

Other information related to leases is as follows:

Future minimum lease payments under non-cancellable leases are as follows:

NOTE 10. Other Liabilities

Other current liabilities are summarized as follows:

Other non-current liabilities are summarized as follows:

NOTE 11. Debt

The Company’s short and long-term debt consists of the following:

On July 19, 2022 the Company entered into an amended and restated Credit Agreement which included a $350 million Term Facility and a $400 million Revolving Credit Facility. The amendment, among other things, changed the Credit Agreement from a LIBOR-based rate to a Secured Overnight Financing Rate ("SOFR") based rate and extended the Credit Agreement maturity date to July 19, 2027.

On June 28, 2023, the Company amended the existing Credit Agreement to, among other things, amend certain affirmative and negative covenants.

The Company has deferred costs of $2 million and $1 million related to these amendments to the Credit Agreement, which are recorded in Other non-current assets and Long-term debt, net, respectively. The deferred costs will be amortized over the term of the Credit Agreement.

Short-Term Debt

Terms of the amended credit facility require a quarterly principal payment equal to 1.25% of the original term debt balance. The first required payment was paid during the second quarter of 2023.

As of December 31, 2025, the Company has no other short-term borrowings, including at the Company's subsidiaries. The Company's subsidiaries have access to $150 million of capacity under short-term credit facilities.

Long-Term Debt

The Company has no outstanding borrowings on the Revolving Credit Facility as of December 31, 2025 and 2024.

Interest on the Term Facility loansand Revolving Credit Facility accrue interest at a rate equal to a SOFR-based rate plus an applicable margin of between 1.00% and 1.75%, as determined by the Company's total gross leverage ratio. The Company can benefit from a 5 basis point decrease to the applicable margin due to a sustainability-linked pricing provision based on the Company's annual performance on reducing GHG emissions.

The Credit Agreement requires compliance with customary affirmative and negative covenants and contains customary events of default. The Revolving Credit Facility also requires that the Company maintain a total net leverage ratio no greater than 3.50:1.00. During any period when the Company’s corporate and family ratings meet investment grade ratings, certain of the negative covenants are suspended.

The Revolving Credit Facility also provides $75 million availability for the issuance of letters of credit and a maximum of $20 million for swing line borrowings. Any amount of the facility utilized for letters of credit or swing line loans outstanding will reduce the amount available under the existing Revolving Credit Facility. The Company may request increases in the limits under the Credit Agreement and may request the addition of one or more term loan facilities. Outstanding borrowings may be prepaid without penalty (other than borrowings made for the purpose of reducing the effective interest rate margin or weighted average yield of the loans). There are mandatory prepayments of principal in connection with: (i) certain asset sales or other dispositions, (ii) certain refinancing of indebtedness and (iii) over-advances under the Revolving Credit Facility.

All obligations under the Credit Agreement and obligations with respect to certain cash management services and swap transaction agreements between the Company and its lenders are unconditionally guaranteed by certain of the Company’s subsidiaries. Under the terms of the Credit Agreement, any amounts outstanding are secured by a first-priority perfected lien on substantially all property of the Company and the subsidiaries party to the security agreement, subject to certain limitations.

The principal maturities of long-term debt as of December 31, 2025 are as follows:

Other

The Company has a $6 million letter of credit facility, whereby the Company is required to maintain a cash collateral account equal to 103% (110% for non-U.S. dollar denominated letters) of the aggregate stated amount of issued letters of credit and must reimburse any amounts drawn under issued letters of credit. The Company had $1 million and $2 million of outstanding letters of credit issued under this facility secured by cash, as of December 31, 2025 and 2024, respectively. Additionally, the Company had $5 million and $4 million of locally issued bank guarantees and letters of credit as of December 31, 2025 and 2024, respectively, to support various tax appeals, customs arrangements and other obligations at its local affiliates.

NOTE 12. Employee Benefit Plans

Defined Benefit Plans

The Company sponsors pay related benefit plans for employees in the U.S., U.K., Germany, Brazil, France, Mexico, Japan, and Canada. Employees in the U.S. and U.K. are no longer accruing benefits under the Company's defined benefit plans as these plans were frozen. The Company’s defined benefit plans are partially funded with the exception of certain supplemental benefit plans for executives and certain non-U.S. plans, primarily in Germany, which are unfunded.

The Company's expense for all defined benefit pension plans, is as follows:

The Company's total accumulated benefit obligations for all defined benefit plans was $640 million and $723 million as of

December 31, 2025 and 2024, respectively. The benefit plan obligations for employee retirement plans with accumulated benefit obligations in excess of plan assets were as follows:

Assumptions used by the Company in determining its defined benefit pension obligations as of December 31, 2025 and 2024 are summarized in the following table:

The Company’s obligation for all defined benefit pension plans, is as follows:

During the year ended December 31, 2025, the Company entered into an annuity contract with a third party in relation to the U.S. defined benefit plan. The annuity contract covered approximately 1,800 participants and resulted in the use of approximately $97 million of plan assets for the settlement of approximately $93 million of the outstanding pension benefit obligation. In connection with the annuity contract, the Company recorded an actuarial loss of $7 million during the year ended December 31, 2025 related to recognition of accumulated other comprehensive income. The third party has unconditionally and irrevocably guaranteed the full payment of benefits to plan participants associated with the annuity purchase and benefits payment will be in the same form that was in effect under the U.S. defined benefit plan.

During the year ended December 31, 2024, the Company offered terminate vested participants of the U.S. defined benefit plans a discretionary lump sum distribution option. The amount of participant lump sum distributions amounted to $38 million.

Components of the net change in AOCI related to all defined benefit pension plans, exclusive of amounts attributable to non-controlling interests on the Company’s Consolidated Statements of Changes in Equity for the years ended December 31, 2025 and 2024, are as follows:

Actuarial gain for the year ended December 31, 2025 is primarily related to an increase in return on assets when compared to the same period in 2024. Actuarial gains and losses are amortized using the 10% corridor approach representing 10% times the greater of plan assets or the projected benefit obligation. Generally, the expected return is determined using a market-related value of assets where gains (losses) are recognized in a systematic manner over five years. For less significant plans, fair value is used.

Benefit payments, which reflect expected future service, are expected to be paid by the Company plans as follows:

During the year ended December 31, 2025, cash contributions to the Company's defined benefit plans were $17 million related to its U.S. plans and $7 million related to its non-U.S. plans. Additionally, the Company expects to make contributions to its US and Non-US defined benefit pension plans of $3 million and $8 million, respectively during 2026.

Substantially all of the Company’s defined benefit pension plan assets are managed by external investment managers and held in trust by third-party custodians. The selection and oversight of these external service providers is the responsibility of the investment committees of the Company and their advisers. The selection of specific securities is at the discretion of the investment manager and is subject to the provisions set forth by written investment management agreements and related policy guidelines regarding permissible investments, risk management practices, and the use of derivative securities. Derivative securities may be used by investment managers as efficient substitutes for traditional securities, to reduce portfolio risks, or to hedge identifiable economic exposures. The use of derivative securities to engage in unrelated speculation is expressly prohibited.

The primary objective of the pension funds is to pay the plans’ benefit and expense obligations when due. Given the long-term nature of these plan obligations and their sensitivity to interest rates, the investment strategy is intended to improve the funded status of its U.S. and non-U.S. plans over time while maintaining a prudent level of risk. Risk is managed primarily by diversifying each plan’s target asset allocation across equity, fixed income securities, and alternative investment strategies, and then maintaining the allocation within a specified range of its target. In addition, diversification across various investment subcategories within each plan is also maintained within specified ranges.

The Company’s retirement plan asset allocation as of December 31, 2025 and 2024 and target allocation for 2026 are as follows:

The expected long-term rate of return for defined benefit pension plan assets was selected based on various inputs, including returns projected by various external sources for the different asset classes held by and to be held by the Company’s trusts and its targeted asset allocation. These projections incorporate both historical returns and forward-looking views regarding capital market returns, inflation, and other variables. Pension plan assets are valued at fair value using various inputs and valuation techniques. A description of the inputs and valuation techniques used to measure the fair value for each class of plan assets is included in Note 17, "Fair Value Measurements."

Discount Rate for Estimated Service and Interest Cost

The Company uses the spot rate method to estimate the service and interest components of net periodic benefit cost for pension benefits for its U.S. and certain non-U.S. plans. The Company has elected to utilize an approach that discounts individual expected cash flows underlying interest and service costs using the applicable spot rates derived from the yield curve used to determine the benefit obligation to the relevant projected cash flows. The discount rate assumption is based on market rates for a hypothetical portfolio of high-quality corporate bonds rated Aa or better with maturities closely matched to the timing of projected benefit payments for each plan at its annual measurement date. The Company used discount rates ranging from 2% to 12% to determine its pension and other benefit obligations as of December 31, 2025.

Defined Contribution Plans

Most U.S. salaried employees and certain non-U.S. employees are eligible to participate in defined contribution plans by contributing a portion of their compensation which is partially matched by the Company. Matching contributions for the U.S. defined contribution plan are 100% on the first 6% of pay contributed. The expense related to all defined contribution plans was approximately $6 million, $6 million, and $6 million for the years ended December 31, 2025, 2024, and 2023.

NOTE 13. Stock-Based Compensation

At the Company’s annual meeting of shareholders in June 2020, the shareholders approved the Visteon Corporation 2020 Incentive Plan (the “2020 Incentive Plan”), replacing the 2010 stock incentive plan and providing for an additional grant of up to 1.5 million shares. During the year ended December 31, 2024, the Company registered to provide an additional 1.3 million shares to the 2020 Incentive Plan. Pursuant to the 2020 Incentive Plan, the Company may grant shares of common stock for restricted stock awards (“RSAs”), restricted stock units (“RSUs”), non-qualified stock options ("Stock Options"), stock appreciation rights (“SARs”), performance-based share units ("PSUs"), and other stock-based awards. The Company's stock-based compensation instruments are accounted for as equity awards or liability awards based on settlement intention as follows:

•For equity settled stock-based compensation instruments, compensation cost is measured based on grant date fair value of the award and is recognized over the applicable service period. For equity settled stock-based compensation instruments, the delivery of Company shares may be on a gross settlement basis or a net settlement basis. The Company's policy is to deliver such shares using treasury shares or issuing new shares.

•Cash settled stock-based compensation instruments are subject to liability accounting. At the end of each reporting period, the vested portion of the obligation for cash settled stock-based compensation instruments is adjusted to fair value based on the period-ending market prices of the Company's common stock. Related compensation expense is recognized based on changes to the fair value over the applicable service period.

Generally, the Company's stock-based compensation instruments are subject to graded vesting and recognized on an accelerated basis. The settlement intention of the awards is at the discretion of the Organization and Compensation Committee of the Company's Board of Directors. These stock-based compensation awards generally provide for accelerated vesting upon a change-in-control, as defined in the 2020 Incentive Plan, which requires a double-trigger (which would require that the executive's employment terminate without "cause" or for "good reason" following a change in control). Accordingly, the Company may be required to accelerate recognition of related expenses in future periods in connection with the change-in-control events and subsequent changes in employee responsibilities, if any.

The total recognized and unrecognized stock-based compensation expense is as follows:

Performance Based Share Units

For the year ended 2025 the number of PSUs that will vest, ranging from 0% to 200% of the target award, is based on a combination of the Company's achievement of a pre-established relative total shareholder return goal compared to its peer group of companies and its average return on invested capital over a three-year period.

For the years ended 2023 and 2024 the number of PSUs that will vest, ranging from 0% to 200% of the target award, is based on the Company's achievement of a pre-established relative total shareholder return goal compared to its peer group of companies over a three-year period.

The grant date fair value for PSUs was determined using the Monte Carlo valuation model. Unrecognized compensation expense as of December 31, 2025 for PSUs to be settled in shares of the Company's common stock was $18 million and will be recognized over the remaining vesting period of approximately 1.6 years. The Company made cash settlement payments of less than $1 million for PSUs settled in cash during each of the years ended December 31, 2025, 2024, and 2023. Unrecognized compensation expense as of December 31, 2025 was less than $1 million for the non-vested portion of these awards and will be recognized over the remaining vesting period of approximately 1.9 years.

The Monte Carlo valuation model requires management to make various assumptions including the expected volatility, risk-free interest rate, and dividend yield. Volatility is based on the Company’s stock history using daily stock prices over a period commensurate with the expected life of the award. The risk-free rate was based on the U.S. Treasury yield curve in relation to the contractual life of the stock-based compensation instrument. The dividend yield was based on historical patterns and future expectations for Company dividends.

Weighted average assumptions used to estimate the fair value of PSUs granted during the years ended as of December 31, 2025 and 2024 are as follows:

Restricted Stock Units

The grant date fair value of RSUs is measured as the market closing price of the Company's common stock on the date of grant. These awards generally vest in one-third increments on the grant date anniversary over athree-year vesting period.

Unrecognized compensation expense as of December 31, 2025 was $23 million for non-vested share-settled RSUs and will be recognized over the remaining vesting period of approximately 1.3 years.

The Company made cash settlement payments of $1 million during the years ended December 31, 2025, 2024, and 2023. Unrecognized compensation expense as of December 31, 2025 was $2 million for non-vested cash settled RSUs and will be recognized on a weighted average basis over the remaining vesting period of approximately 1.5 years.

A summary of RSU activity is provided below:

Beginning in the third quarter 2020, non-employee director RSU awards were granted under the terms and conditions of the 2020 Incentive Plan, and these awards vest approximately one year from the date of grant. Activity related to non-employee director grants under the 2020 Incentive Plan is included in RSU table above.

Additionally, as of December 31, 2025, the Company has approximately 98,000 outstanding RSU's awarded at a weighted average grant date fair value of $97.11 under the Non-Employee Director Stock Unit Plan which vest within one year or less but are not settled until the participant terminates board service. Total RSU's outstanding as of December 31, 2025 is approximately 755,000 inclusive of the table above.

Stock Options and Stock Appreciation Rights

Stock Options and SARs are recorded with an exercise price equal to the average of the high and low market price of the Company's common stock on the date of grant. The grant date fair value of these awards is measured using the Black-Scholes option pricing model. Stock Options and SARs generally vest in one-third increments on the grant date anniversary over a three-year vesting period and have an expiration date 7 or 10 years from the date of grant.

The Company received payments of $3 million, less than $1 million, and $6 million related to the exercise of Stock Options with total intrinsic value of options exercised of $1 million, less than $1 million, and $4 million during the years ended December 31, 2025, 2024, and 2023, respectively. There is no remaining unrecognized compensation expense for Stock Options as of December 31, 2025.

The Black-Scholes option pricing model requires management to make various assumptions including the expected term, risk-free interest rate, dividend yield, and expected volatility. The expected term represents the period of time that granted awards are expected to be outstanding and is estimated based on considerations including the vesting period, contractual term, and anticipated employee exercise patterns. The risk-free rate is based on the U.S. Treasury yield curve in relation to the contractual life of the stock-based compensation instrument. The dividend yield is based on historical patterns and future expectations for Company dividends. Volatility is based on the Company’s stock history using daily stock prices over a period commensurate with the expected life of the award.

No stock options or SARs were granted in 2025,2024 or 2023. There are no SARs outstanding as of the years ended December 31,2025,2024 or 2023.

A summary of Stock Options activity is provided below:

NOTE 14. Income Taxes

Income Tax Provision

The Company is subject to income taxation in the United States and various state and foreign jurisdictions. Income tax includes current and deferred taxes.

Effective for the year ended December 31, 2025, the Company adopted ASU 2023‑09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires enhanced disaggregation of the rate reconciliation and income taxes paid.

Details of the Company's income tax provision for (benefit from) continuing operations are provided in the table below:

The provision for (benefit from) income taxes resulted in an effective tax rate of approximately 38%, -3%, and -124% for the years ended December 31, 2025, 2024 and 2023, respectively.

The table below provides a reconciliation of income tax based on the U.S. statutory tax rate of 21% to the final provision for (benefit from) income taxes.

The Company's tax rate is affected by the tax laws and rates in the U.S. and other countries where it operates. It also depends on the amount of income earned in each jurisdiction and the extent of losses or income for which no tax benefit or expense was recognized due to a valuation allowance.

The U.S. tax on earnings includes the impact of income taxes on foreign source income, such as foreign branch earnings, net of applicable foreign tax credits in various categories (general, foreign branch, global intangible low-tax income (GILTI) and passive). It also considers the estimated impact of unrecognized currency gains and losses in branch operations under final regulations of Internal Revenue Code Section 987. The Company's benefit from foreign derived intangible income (FDII) depends on its annual U.S. taxable income, which is influenced by U.S. tax regulations requiring the capitalization of research and development costs in the current period which also impacts the GILTI calculation. U.S. tax amendments primarily involve adjusting prior year tax returns to deduct foreign taxes before expiration, while the foreign rate differential reflects tax expense on foreign earnings taxed at rates higher than the U.S. statutory rate.

The Company’s effective tax rate is also impacted by net changes to valuation allowances, where the Company has determined that it is more-likely-than-not that certain deferred tax assets would not be realized. For the years ended December 31, 2025, 2024, and 2023, the Company recorded net benefits related to valuation allowances of $142 million, $47 million, and $459 million, respectively (discussed in further detail below).

Deferred income taxes represent temporary differences in the recognition of certain items for financial reporting and income tax purposes. A summary of the components of deferred income tax assets and liabilities are as follows:

As of December 31, 2025, the Company had available pretax non-U.S. net operating loss carryforwards and capital loss carryforwards of$1.4 billion and$17 million, respectively,$72 million of which expire at various dates from 2026 through 2046, and$1.3 billion of which have an indefinite life.

The Company had available pretax U.S. federal net operating loss carryforwards of$880 million at December 31, 2025, which have remaining carryforward periods ranging from 4 years to 9 years. U.S. foreign tax credit carryforwards are$115 million at December 31, 2025, which have remaining carryforward periods ranging from 2 to 10 years. U.S. research tax credit carryforwards are$31 million at December 31, 2025. These credits will begin to expire in 2031. The Company had available post-apportionment tax-effected U.S. state operating loss carryforwards of$28 million at December 31, 2025,$26 million which will expire at various dates between 2026 and 2044, and$2 million of which have an indefinite life.

In connection with the Company's emergence from bankruptcy and resulting change in ownership on the Effective Date, an annual limitation was imposed on the utilization of U.S. net operating losses, U.S. credit carryforwards and certain U.S. built-in losses (collectively referred to as “tax attributes”) under Internal Revenue Code (“IRC”) Sections 382 and 383. The collective limitation is approximately $121 million per year on tax attributes in existence at the date of change in ownership.

Valuation Allowances

As of December 31, 2025 and 2024, the valuation allowance with respect to the Company's deferred tax assets was $473 million and $598 million, respectively, a net decrease of $125 million.

The Company provides a valuation allowance for its deferred tax assets when it is more likely than not that some portion, or all, of its deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income of the appropriate character in the respective jurisdiction. The Company considers all available positive and negative evidence and makes certain assumptions in evaluating the realizability of its deferred tax assets.

The Company historically provided a valuation allowance against its U.S. net deferred tax assets prior to 2023. However, as the Company continued to improve its earnings, the Company concluded that the positive evidence, which included its forecast of future taxable income using its objective and verifiable earnings history, outweighed the negative evidence (the Company’s history of losses) indicating that it was more likely than not that the Company would be able to realize a benefit for a substantial portion of its U.S. deferred tax assets, resulting in a $395 million partial release of its valuation allowance related to its U.S. deferred tax assets as of December 31, 2023 as estimated under the tax-law-ordering approach following change in accounting principle described in Note 1, "Summary of Significant Accounting Policies."

As of December 31, 2024, after considering all positive and negative evidence, including improvement in the Company’s U.S. profitability beyond the projections utilized in estimating the realizability of its U.S. deferred tax assets in 2023, the Company concluded that additional U.S. deferred income tax assets were more likely than not to be realized resulting in a $71 million non-cash benefit to income tax expense in 2024 as estimated under the tax-law-ordering approach following the change in accounting principle described in Note 1, "Summary of Significant Accounting Policies." The deferred tax assets not expected to be realized based on the Company’s projections primarily relate to: (i) existing foreign tax credit carryforwards, as the Company has been and is expected to continue to generate excess credits in the near term, resulting in an inability to use all of its existing carryforwards prior to expiration; (ii) certain U.S. research credit carryforwards expected to expire prior to utilization; and (iii) certain State operating loss carryforwards that are expected to expire prior to utilization.

During the fourth quarter of 2025, the Company updated its forward-looking profitability projections and reassessed the expected utilization of its deferred tax carryforward attributes using the tax law ordering approach, consistent with the change in accounting principle described in Note 1, "Summary of Significant Accounting Policies." This assessment incorporated the estimated effects of the One Big Beautiful Bill Act (the “Act”) as well as refinements to state level valuation allowance estimates. As a result of this analysis, the Company recognized discrete income tax expense of $55 million in 2025.

The Company’s change in accounting methodology for assessing the realizability of its deferred tax assets and resulting valuation allowance from an incremental cash-tax-savings approach to the tax-law-ordering approach resulted in a cumulative $77 million income tax benefit over the three‑year period ended December 31, 2025. The Company recognized $104 million of the benefit in 2023 and 2024, which was offset by a $27 million income tax expense recorded in 2025.

As of December 31, 2025, deferred tax assets not expected to be realized relate primarily to remaining foreign tax credit carryforwards after a $184 million reduction to reflect amendments to prior year tax returns to deduct foreign taxes prior to expiration, with such reduction fully offset by a corresponding income tax benefit arising from a decrease in the U.S. valuation allowance, as well as certain U.S. research credits and select state net operating loss carryforwards. The Company continues to maintain a U.S. valuation allowance of $159 million as of December 31, 2025.

During the third quarter of 2024 and fourth quarter of 2025, the Company reassessed the realizability of its deferred tax assets in Germany. These reassessments were driven primarily by the Company’s German Acquisition completed in 2024 and the UX Acquisition in 2025, each of which will be combined with the Company’s existing German consolidated tax group. The resulting increase in projected future taxable income led the Company to recognize income tax benefits of $7 million in both 2024 and 2025, respectively.

During the fourth quarter of 2025, the Company reassessed the realizability of its deferred tax assets related to its Brazil affiliate, Visteon Amazonas (“Amazonas”). Based primarily on sustained profitability and updated projections of future taxable income, management concluded that the deferred tax assets associated with Amazonas are now more likely than not to be realized. Accordingly, the Company released its valuation allowance in full and recorded a discrete income tax benefit of $13 million for the year ended December 31, 2025.

As of December 31, 2025, valuation allowances totaling $314 million relate to deferred tax assets in certain foreign jurisdictions, primarily Germany and France.

The Company will continue to evaluate the available positive and negative evidence in subsequent periods and adjust its remaining valuation allowances to the amount it determines to be more likely than not to be realized. If operating results improve or deteriorate on a sustained basis, the Company’s conclusions regarding the need for a valuation allowance could change, resulting in either the reversal or initial recognition of a valuation allowance in the future, which could have a significant impact on income tax expense in the period recognized and subsequent periods.

The Company has recorded the taxes associated with the foreign earnings it intends to repatriate in the future. The amount the Company expects to repatriate is based upon a variety of factors including current year earnings of the foreign affiliates, foreign investment needs, and the cash flow needs of the Company. As of December 31, 2025 and 2024, the Company has recorded withholding tax liabilities of $25 million and $27 million, respectively related to these earnings. These earnings are expected to be non-taxable upon repatriation to the U.S., as they will largely be considered previously taxed income under the one-time transition tax or GILTI, or they will be offset by a 100% dividend received deduction. The Company has not provided for deferred tax liabilities for foreign withholding or other taxes on the remainder of undistributed earnings because such earnings are considered to be permanently reinvested. It is not practicable to determine the amount of deferred tax liability on such earnings as the actual tax liability, if any, is dependent on circumstances existing when remittance occurs.

The Company is subject to a wide variety of U.S. federal, state, and foreign tax laws, regulations, and governmental policies. Future changes to these tax regimes may materially affect the Company’s tax obligations, investment returns, and overall business operations.

On July 4, 2025, the reconciliation legislation commonly referred to as the One Big Beautiful Bill Act (the “Act”) was enacted in the United States. The Act contains significant tax reform measures, including modifications to the international tax framework. Beginning in 2025, the Act introduces an elective deduction for domestic research and development expenditures. Additional provisions become effective in 2026 and subsequent periods, including reduced tax rates applicable to Foreign‑Derived Deduction Eligible Income (FDDEI) and Net CFC Tested Income (NCTI), which replaced the former GILTI regime, as well as enhanced foreign tax credit utilization rules associated with NCTI‑related income.

As a result of these statutory changes, the Company expects reduced utilization of its existing general foreign tax credit carryforwards in favor of future NCTI foreign tax credits. Accordingly, during the third quarter of 2025, the Company recognized tax expense to increase the valuation allowance associated with these foreign tax credit carryforwards, consistent with the tax‑law‑ordering approach following the change in accounting principle described in Note 1, "Summary of Significant Accounting Policies" as discussed above. The Company continues to monitor developments related to the Act and will evaluate the impact of these legislative changes as additional regulatory guidance becomes available.

The Company is subject to the OECD Pillar Two global minimum tax rules, which establish a 15% minimum effective tax rate on global income. While it remains uncertain whether the United States will adopt Pillar Two, several jurisdictions in which the Company operates have enacted these rules, and others are progressing toward implementation. As global adoption continues, the Company is assessing the potential effects on its future tax profile, cash tax obligations, and operational structure. As part of this evaluation, the Company is considering the availability of transitional and permanent safe harbors, including the Country‑by‑Country Reporting safe harbor, and the application of local Qualified Domestic Minimum Top‑Up Taxes, such as in Brazil, where foregoing certain tax incentives facilitated a tax‑efficient repatriation of earnings from its Brazil affiliate under the 15% minimum tax framework during 2025. On January 5, 2026, the OECD issued additional guidance introducing a “side‑by‑side arrangement,” which, once adopted, would prevent foreign jurisdictions from imposing top‑up tax on U.S. profits of U.S. companies. The Company is monitoring ongoing U.S. and international legislative developments and will assess any impacts as further guidance becomes available.

Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:

Gross unrecognized tax benefits at December 31,2025 and 2024 were $25 million and $20 million, respectively. Of these amounts, approximately $18 million and $13 million respectively, represent the amount of unrecognized benefits that, if recognized, would impact the effective tax rate. The Company records interest and penalties related to uncertain tax positions as a component of income tax expense and related amounts accrued as of December 31,2025 and 2024 were $5 million and $3 million, respectively.

With few exceptions, the Company is no longer subject to U.S. federal tax examinations for years before 2016, or state, local or non-U.S. income tax examinations for periods outside the relevant statutes of limitation, unless those years remain under audit or litigation. U.S. net operating losses carried forward into open tax years remain subject to adjustment. Although it is not possible to predict the timing of the resolution of all ongoing tax audits with accuracy, the Company expects that it is reasonably possible that the total amount of unrecognized tax benefits will decrease within the next twelve months due to the anticipated settlement of an ongoing bilateral Advance Pricing Agreement with the U.S. Internal Revenue Service and the India Tax Authority (“ITA”) which could result in payment to the ITA in the range of $10 to $15 million (including interest) by the end of 2026. Given the number of years, jurisdictions and positions subject to examination, the Company is unable to estimate the full range of other possible adjustments to the balance of unrecognized tax benefits. The long-term portion of uncertain income tax positions (including interest) in the amount of $9 million is included in Other non-current liabilities on the consolidated balance sheet, while the short-term portion in the amount of $14 million is included in Other current liabilities, and $7 million is reflected as a reduction of deferred tax assets included in Other non-current assets. Outstanding income tax refund claims related primarily to India and Brazil jurisdictions total $4 million as of December 31, 2025, and are included in other non-current assets on the balance sheets.

Income Taxes Paid (Net of Refunds)

For the year ended December 31, 2025, the Company paid a total of $98 million in income taxes across U.S. federal, state, and foreign jurisdictions. Consistent with ASU 2023-09, the Company discloses income taxes paid to each jurisdiction where the amount paid (net of refunds received) is equal to or greater than 5% of total income taxes paid. All other individual jurisdictions, including the U.S. federal and states, did not exceed the 5% disclosure threshold and are presented in the aggregate.

Significant jurisdictions for the period include:

Other Tax Matters

In January 2023, the Company received a decision by the Indian Tax Authority (“ITA”) that tax applies to certain IT-related services fees paid to the U.S. which spans several years. Until this matter is resolved, the Company will likely need to remit taxes on the services in question for which payments could be significant in the aggregate. The Company believes the ITA’s decision is without merit, and intends to defend its position vigorously, and expects to recoup any taxes paid. If this matter is adversely resolved, the Company would record additional tax expense, which would include any taxes ultimately paid.

NOTE 15. Stockholders’ Equity and Non-controlling Interests

Treasury Stock

As of December 31, 2025 and 2024, respectively, the Company held 28,196,199 and 27,860,349 shares of common stock in treasury which may be used for satisfying obligations under employee incentive compensation arrangements. The Company values shares of common stock held in treasury at cost.

Non-Controlling Interests

Non-controlling interests in Visteon Corporation are as follows:

Accumulated Other Comprehensive Income (Loss)

Changes in AOCI and reclassifications out of AOCI by component includes:

Share Repurchase Program

On March 2, 2023 the Company's board of directors authorized a share repurchase program of $300 million of common stock through December 31, 2026. Under this program, the Company will repurchase shares at the prevailing market prices pursuant to specified share price and daily volume limits. During the year ended December 31, 2025, the Company has purchased 555,997 shares at an average price of $101.70 related to this program. As of December 31, 2025, the Company has $74 million of authorized purchases of common stock remaining. Excise taxes incurred due to purchases under the program totaled less than $1 million for the year ended December 31, 2025.

Dividends

During 2025, the Board declared two quarterly cash dividends of $0.275 per share, paid on September 5 and December 5 to shareholders of record as of August 18 and November 18, respectively. Cash dividends totaled $15 million for the year ended December 31, 2025. No dividends were declared or paid in 2024.

Subsequent to December 31, 2025, the Board declared a quarterly cash dividend of $0.375 per share, payable on March 16, 2026 to shareholders of record as of March 2, 2026.

NOTE 16. Earnings Per Share

A summary of information used to compute basic and diluted earnings per share attributable to Visteon is as follows:

Balances shown reflect the change in accounting principle related to the method for assessing the realizability of U.S. deferred tax assets described in Note 1. Summary of Significant Accounting Policies

NOTE 17. Fair Value Measurements

Fair Value Hierarchy

The Company uses a three-level fair value hierarchy that categorizes assets and liabilities measured at fair value based on the observability of the inputs utilized in the valuation. The fair value hierarchy gives the highest priority to the quoted prices in active markets for identical assets and liabilities and lowest priority to unobservable inputs.

•Level 1 – Financial assets and liabilities whose values are based on unadjusted quoted market prices for identical assets and liabilities in an active market that the Company has the ability to access.

•Level 2 – Financial assets and liabilities whose values are based on quoted prices in markets that are not active or model inputs that are observable for substantially the full term of the asset or liability.

•Level 3 – Financial assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement.

Assets which are valued at net asset value per share ("NAV"), or its equivalent, as a practical expedient are reported outside the fair value hierarchy but are included in the total assets for reporting and reconciliation purposes.

The fair value hierarchy for assets and liabilities measured at fair value on a recurring basis are as follows:

Cross currency swaps and interest rate swaps are valued using industry-standard models that consider various assumptions, including time value, volatility factors, current market, and contractual prices for the underlying and non-performance risk. Substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument, can be derived from observable data, or are supported by observable levels at which transactions are executed in the marketplace. The carrying amounts of all other non-retirement plan financial instruments approximate their fair values due to their relatively short-term maturities.

Retirement plan assets pertain to a diverse set of securities and investment vehicles held by the Company’s defined benefit pension plans. These assets possess varying fair value measurement attributes such that certain portions are categorized within each level of the fair value hierarchy as based upon the level of observability of the inputs utilized in the valuation of the particular asset. The Company may, as a practical expedient, estimate the fair value of certain investments using NAV of the investment as of the reporting date. This practical expedient generally deals with investments that permit an investor to redeem its investment directly with, or receive distributions from, the investee at times specified in the investee’s governing documents. Examples of these investments (often referred to as alternative investments) may include ownership interests in real assets, certain credit strategies, and hedging and diversifying strategies. They are commonly in the form of limited partnership interests. The Company uses NAV as a practical expedient when valuing investments in alternative asset classes and funds which are a limited partnership or similar investment vehicle.

Derivative financial instruments

Derivative financial instruments are measured at fair value on a recurring basis under an income approach using industry-standard models that consider various assumptions, including time value, volatility factors, current market and contractual prices for the underlying, and non-performance risk. Substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument or may derived from observable data. Accordingly, the Company's derivative instruments are classified as Level 2, "Other Observable Inputs" in the fair value hierarchy.

Retirement Plan Assets

Retirement plan assets consist of the following:

•Cash and cash equivalents, are immediately available or are highly liquid and not subject to significant market risk. Assets comprised of cash, short-term sovereign debt, or high credit-quality money market securities and instruments held directly by the plan are categorized as Level 1. Assets in a short-term investment fund ("STIF") are categorized as Level 2. Cash and cash equivalent assets denominated in currencies other than the U.S. dollar are reflected in U.S. dollar terms at the exchange rate prevailing at the balance sheet dates.

•Treasury and government securities consist of debt securities issued by the U.S. and non-U.S. sovereign governments and agencies, thereof. Assets with a high degree of liquidity and frequent trading activity are categorized as Level 1 while others are valued by independent valuation firms that employ standard methodologies associated with valuing fixed-income securities and are categorized as Level 2.

•Corporate debt securities consist of fixed income securities issued by corporations. Assets with a high degree of liquidity and frequent trading activity are categorized as Level 2 while others are valued by independent valuation firms that employ standard methodologies associated with valuing fixed-income securities and are categorized as Level 2.

•Bond funds are comprised of corporate and municipal bonds. These securities are generally priced by independent pricing services. The spreads are sourced from broker/dealers, trade prices and the new issue market. As the significant inputs used to price corporate bonds are observable market inputs, the fair values of corporate bonds are included in the Level 2 fair value hierarchy.

•Common and preferred stocks consist of shares of equity securities. These are directly-held assets that are generally publicly traded in regulated markets that provide readily available market prices and are categorized as Level 1.

•Common trust funds are comprised of shares or units in commingled funds that are not publicly traded. The underlying assets in these funds, including equities and fixed income securities, are generally publicly traded in regulated markets that provide readily available market prices. The entire balance of an investment in a common trust fund that does not have a readily observable market prices as available on a third-party information source, notwithstanding whether the investment has daily liquidity, is categorized as Level 2; or the fund is considered as an alternative strategy (including hedge and diversifying strategies) for which valuation is established by NAV as a practical expedient.

•Liability Driven Investments (“LDI”) utilizes certain funds that invest in instruments and securities, interest-rate swaps and other financial derivative instruments intended to hedge a portion of the changes in pension liabilities associated with changes in the actuarial discount rate as applied to the plan’s liabilities. The valuation methodology of the funds that invest in fixed income derivative instruments, the assets contained in this category utilize standard pricing models associated with fixed income derivative instruments and are categorized as Level 2.

•Repurchase agreements represent the plans’ short-term borrowing to hedge against interest rate and inflation risks. The plans have an obligation to return the cash after the term of the agreements. Due to the short-term nature of the agreements, the outstanding balance of the obligation approximates fair value. These borrowings are categorized as Level 2.

•Other investment funds include funds that hold various short-term, real-estate related, and fixed income assets and are categorized as Level 1, Level 2, and NAV, consistent with the valuation techniques of investment funds described above.

•Limited partnerships and hedge funds represent investment vehicles with underlying exposures in alternative credit, hedge and diversifying strategies (including hedge fund of funds), real assets, and certain equity exposures. The underlying assets in these funds may include securities transacted in active markets as well as other assets that have values less readily observable and may require valuation techniques that require inputs that are not readily observable. Investment in these funds may be subject to a specific notice period prior to the intended transaction date. In addition, transactions in these funds may require longer settlement terms than traditional mutual funds. These assets are valued based on their respective NAV as a practical expedient to estimate fair value due to the absence of readily available market prices.

•Insurance contracts are reported at cash surrender value and have significant unobservable inputs and are categorized as Level 3.

The fair values of the Company’s U.S. retirement plan assets are as follows:

The fair values of the Company’s Non-U.S. retirement plan assets are as follows:

Items Measured at Fair Value on a Non-recurring Basis

The Company measures certain assets and liabilities at fair value on a non-recurring basis, which are not included in the table above. As these non-recurring fair value measurements are generally determined using unobservable inputs, these fair value measurements are classified within Level 3 of the fair value hierarchy.

The Company evaluates its long-lived assets for impairment whenever events or circumstances indicate the value of these long-lived asset groups are not recoverable.

No impairment charges were recorded for the years ended December 31, 2025 and 2024.

Fair Value of Debt

The fair value of debt was $304 million and $319 million as of December 31, 2025 and 2024, respectively. Fair value estimates were based on quoted market prices or current rates for the same or similar issues or on the current rates offered to the Company for debt of the same remaining maturities. Accordingly, the Company's debt is classified as Level 1 "Market Prices" and Level 2 "Other Observable Inputs" in the fair value hierarchy.

NOTE 18. Financial Instruments

The Company is exposed to various market risks including, but not limited to, changes in foreign currency exchange rates and market interest rates. The Company manages these risks, in part, through the use of derivative financial instruments. The use of derivative financial instruments creates exposure to credit loss in the event of nonperformance by the counterparty to the derivative financial instruments. The Company limits this exposure by entering into agreements including master netting arrangements directly with a variety of major highly rated financial institutions that are expected to fully satisfy their obligations under the contracts. Additionally, the Company’s ability to utilize derivatives to manage risks is dependent on credit and market conditions. The Company presents its derivative positions and any related material collateral under master netting arrangements that provide for the net settlement of contracts, by counterparty, in the event of default or termination. There is no cash collateral on any of these derivatives.

Foreign Currency Exchange Rate Risk

The maximum length of time over which the Company hedges forecasted transactions related to variable interest payments is the term of the underlying debt.

Cross Currency Swaps: The Company has executed cross-currency swap transactions intended to mitigate the variability of the U.S. dollar value of its investment in certain of its non-U.S. entities. These swaps are designated as net investment hedges and the Company has elected to assess hedge effectiveness under the spot method. Accordingly, changes in the fair value of the swaps are recorded as a cumulative translation adjustment in AOCI in the Consolidated Balance Sheet.

As of December 31, 2025 and 2024 the Company had cross-currency swaps with aggregate notional amounts of $200 million intended to mitigate the variability of U.S. dollar value investment in certain of its non-U.S. entities. These swaps are designated as net investment hedges. There was no ineffectiveness associated with such derivatives as of December 31, 2025 and 2024. The fair value of these derivatives is a non-current liability of $16 million and $1 million as of December 31, 2025 and 2024, respectively. As of December 31, 2025, a gain of approximately $3 million is expected to be reclassified out of accumulated other comprehensive income into earnings within the next 12 months.

Interest Rate Swaps: The Company utilizes interest rate swap instruments to manage its exposure and to mitigate the impact of interest rate variability. The swaps are designated as cash flow hedges, accordingly, the effective portion of the changes in fair value is recognized in accumulated other comprehensive income. Subsequently, the accumulated gains and losses recorded in equity are reclassified to income in the period during which the hedged exposure impacts earnings.

As of December 31, 2025 and 2024 the Company had interest rate swaps with aggregate notional amounts of $250 million. The fair value of these derivatives is a non-current asset of $2 million and $8 million as of December 31, 2025 and 2024, respectively. As of December 31, 2025, a loss of approximately $3 million is expected to be reclassified out of accumulated other comprehensive income into earnings within the next 12 months.

Financial Statement Presentation

Gains and losses on derivative financial instruments for the years ended December 31, 2025 and 2024 are as follows:

Concentrations of Credit Risk

The following is a summary of the percentage of net sales and accounts receivable from the Company's customers with a percentage of net sales greater than 10 percent:

NOTE 19. Commitments and Contingencies

Litigation and Claims

In 2003, the Local Development Finance Authority of the Charter Township of Van Buren, Michigan issued approximately $28 million in bonds finally maturing in 2032, the proceeds of which were used at least in part to assist in the development of the Company’s U.S. headquarters located in the Township. During January 2010, the Company and the Township entered into a settlement agreement (the “Settlement Agreement”) that, among other things, reduced the taxable value of the headquarters property to current market value and also provided that the Company would negotiate in good faith with the Township if the property tax payments were inadequate to permit the Township to meet its payment obligations with respect to the bonds. On December 9, 2019, the Township commenced litigation against the Company in Michigan’s Wayne County Circuit Court. On June 27, 2023, Visteon and the Township entered into a Settlement and Mutual Release Agreement pursuant to which Visteon, without admitting wrongdoing, will pay the Township $12 million. Payment was made in two equal installments, the first on July 3, 2023 and the second on July 1, 2024. The litigation commenced in Michigan’s Wayne County Circuit Court and has been dismissed with prejudice.

The Company's operations in Brazil are subject to highly complex labor, tax, customs and other laws. While the Company believes that it is in compliance with such laws, it is periodically engaged in litigation regarding the application of these laws. As of December 31, 2025, the Company maintained accruals of approximately $6 million for claims aggregating approximately $45 million in Brazil. The amounts accrued represent claims that are deemed probable of loss and are reasonably estimable based on the Company's assessment of the claims and prior experience with similar matters.

While the Company believes its accruals for litigation and claims are adequate, the final amounts required to resolve such matters could differ materially from recorded estimates and the Company's results of operations and cash flows could be materially affected.

Product Warranty and Recall

Amounts accrued for product warranty and recall provisions are based on management’s best estimates of the amounts that will ultimately be required to settle such items. The Company’s estimates for product warranty and recall obligations are developed with support from its sales, engineering, quality, and legal functions and include due consideration of contractual arrangements, past experience, current claims and related information, production changes, industry and regulatory developments, and various other considerations. These estimates do not include amounts which may ultimately be recovered from the Company's suppliers. The Company can provide no assurances that it will not experience material obligations in the future or that it will not incur significant costs to defend or settle such obligations beyond the amounts accrued or beyond what the Company may recover from its suppliers.

The following table provides a reconciliation of changes in the product warranty and recall liability:

Other Contingent Matters

Various legal actions, governmental investigations and proceedings and claims are pending or may be instituted or asserted in the future against the Company, including those arising out of alleged defects in the Company’s products; customs classifications; governmental regulations relating to safety; employment-related matters; customer, supplier and other contractual relationships; intellectual property rights; product warranties; product recalls; tax matters, including the ITA tax matter described in Note 14, "Income Taxes"; and environmental matters. Some of the foregoing matters may involve compensatory, punitive or antitrust, or other treble damage claims in very large amounts, or demands for recall campaigns, environmental remediation programs, sanctions, or other relief which, if granted, would require very large expenditures. The Company enters into agreements that contain indemnification provisions in the normal course of business for which the risks are considered nominal and impracticable to estimate.

Contingencies are subject to many uncertainties, and the outcome of individual litigated matters is not predictable with assurance. Reserves have been established by the Company for matters discussed in the immediately foregoing paragraph where losses are deemed probable and reasonably estimable. It is possible, however, that some of the matters discussed in the foregoing paragraph could be decided unfavorably to the Company and could require the Company to pay damages or make other expenditures in amounts, or a range of amounts, that cannot be estimated as of December 31, 2025 and that are in excess of established reserves. Based on its analysis, the Company does not reasonably expect, except as otherwise described herein, that any adverse outcome from such matters would have a material effect on the Company’s financial condition, results of operations or cash flows, although such an outcome is possible.

NOTE 20. Segment Information and Revenue Recognition

The Company manages the business activities on a consolidated basis and operates in one reportable segment. The Company’s reportable segment is Electronics. The Electronics segment provides vehicle cockpit electronics products to customers, including digital instrument clusters, information displays, infotainment, cockpit domain controllers, CognitoAITM, battery management systems, high voltage power electronics, and engineering services. As the Company hasone reportable segment, net sales, total assets, depreciation, amortization and capital expenditures are equal to consolidated results.

Financial results for the Company's reportable segment have been prepared using a management approach, which is consistent with the basis and manner in which financial information is evaluated by the Company's Chief Operating Decision Maker ("CODM") in allocating resources and in assessing performance. The Company’s CODM is the Chief Executive Officer. The measurement of segment profit or loss that the CODM uses to evaluates the performance of the Company’s segment is net income attributable to Visteon Corporation. Financial forecasts and budget to actual results used by the CODM to assess performance and allocate resources, as well as those used for strategic decisions related to headcount and capital expenditures are reviewed on a consolidated basis. The CODM considers the impact of the significant segment expenses in the table below on net income when deciding whether to reinvest profits, propose dividends or share repurchase, or pursue strategic mergers and acquisitions.

A summary of segment revenue, segment net income (loss) attributable to Visteon Corporation, and significant segment expense for the years ended December 31, 2025, 2024 and 2023 is as follows:

Other cost of sales excludes depreciation and amortization, non-cash stock-based compensation, and engineering recoveries which are presented individually above.

Other selling, general and administrative excludes depreciation and amortization and non-cash stock-based compensation which are presented individually above.

Financial Information by Geographic Region

Financial information about net sales and net tangible long-lived assets by country are as follows:

Disaggregated revenue by product lines is as follows:

NOTE 21. Other Income (Loss), Net

Pension financing benefits, net include return on assets net of interest costs and other amortization.

The Company recorded a settlement loss of $7 million during the year ended December 31, 2025 in connection with an annuity contract associated with the U.S. defined benefit plan. For further detail on the annuitization see Note 12, "Employee Benefit Plans".

During 2024 the Company incurred settlement and curtailment losses of $4 million related to an early buyout of individuals in the U.S. defined benefit plan.

During the year ended December 31, 2023, the Company recorded a charge of $12 million in regards to the Charter Township of Van Buren, Michigan settlement. See Note 19, "Commitments and Contingencies” for more information.

NOTE 22. Selected Quarterly Financial Data (unaudited)

Effective December 31, 2025, the Company changed its accounting method for assessing the realizability of U.S. deferred tax assets from the incremental cash tax savings methodology to the tax-law-ordering methodology. The change in methodology, effective December 31, 2025, has been determined to be a change in accounting principle and the effects of the change have been applied and disclosed retrospectively. See Note 1, "Summary of Significant Accounting Policies”.

Accordingly, the financial statements for all quarters during the year ended December 31, 2024, and the first, second, and third quarters of 2025 have been retrospectively adjusted from what was previously reported in the Quarterly Reports on Form 10-Q.

The following tables summarize the effects of the change in accounting method for select quarterly financial data.