Aptiv PLC

Previous wording

The following management’s discussion and analysis of financial condition and results of operations (“MD&A”) is intended to help you understand the business operations and financial condition of the Company for the three and six months ended June 30, 2025. This discussion should be read in conjunction with Item 1. Financial Statements. Our MD&A is presented in eight sections:

Current wording

The following management’s discussion and analysis of financial condition and results of operations (“MD&A”) is intended to help you understand the business operations and financial condition of the Company for the three and nine months ended September 30, 2025. This discussion should be read in conjunction with Item 1. Financial Statements. Our MD&A is presented in eight sections:

Previous wording

On January 22, 2025, we announced our intention to pursue a separation of our Electrical Distribution Systems business through a transaction expected to be treated as a tax-free spin-off to its shareholders (the “Separation”). The Company plans to complete the Separation by March 31, 2026, subject to customary closing conditions. During the three and six months ended June 30, 2025, the Company incurred costs of $28 million and $47 million, respectively, related to the Separation. These costs, which are included in selling, general and administrative expense within the consolidated statements of operations, are primarily related to third party professional fees associated with planning the Separation. The Company expects to continue to incur additional expenses related to the Separation through the date of completion.

Current wording

On January 22, 2025, we announced our intention to pursue a separation of our Electrical Distribution Systems business through a transaction expected to be treated as a tax-free spin-off to its shareholders (the “Separation”). The Company plans to complete the Separation by March 31, 2026, subject to customary closing conditions. During the three and nine months ended September 30, 2025, the Company incurred costs of $53 million and $100 million, respectively, related to the Separation. These costs, which are included in selling, general and administrative expense within the consolidated statements of operations, are primarily related to third party professional fees associated with planning the Separation. The Company expects to continue to incur additional expenses related to the Separation through the date of completion.

Previous wording

Our total net sales during the three and six months ended June 30, 2025 were $5.2 billion and $10.0 billion, an increase of 3% and 1% compared to the same periods of 2024, respectively. Our volumes increased 2% for the three months ended June 30, 2025, which primarily reflects volume growth in Asia Pacific and North America, partially offset by volume declines in Europe, compared to increased global automotive production of 2% (flat on an Aptiv weighted market basis, which represents global vehicle production weighted to the geographic regions in which the Company generates its revenue, “AWM”). Our volumes increased 1% for the six months ended June 30, 2025, which primarily reflects volume growth in Asia Pacific, partially offset by volume declines in Europe, compared to increased global automotive production of 3% (down 1% on an AWM basis).

Current wording

Our total net sales during the three and nine months ended September 30, 2025 were $5.2 billion and $15.2 billion, an increase of 7% and 3% compared to the same periods of 2024, respectively. Our volumes increased 6% for the three months ended September 30, 2025, which primarily reflects volume growth in North America and Asia Pacific, partially offset by volume declines in Europe, compared to increased global automotive production of 4% (4% on an Aptiv weighted market basis, which represents global vehicle production weighted to the geographic regions in which the Company generates its revenue, “AWM”). Our volumes increased 2% for the nine months ended September 30, 2025, which primarily reflects volume growth in North America and Asia Pacific, partially offset by volume declines in Europe, compared to increased global automotive production of 4% (1% on an AWM basis).

Previous wording

As part of our strategy to harness the full potential of connected intelligent systems across industries, strengthen our capabilities in software-defined mobility and to enable advanced smart vehicle architecture changes, we acquired Wind River in December 2022. Wind River is a global leader in delivering software for the intelligent edge for multiple industries, including automotive, by leveraging mixed-criticality software products and solutions enabling customers to develop in the cloud, deploy over the air and run and manage software at the vehicle edge.

Current wording

As part of our strategy to harness the full potential of connected intelligent systems across industries, strengthen our capabilities in software-defined mobility and to enable advanced smart vehicle architecture changes, we acquired Wind River in December 2022. Wind River is a global leader in delivering software for the intelligent edge for multiple industries, including automotive, by leveraging mixed-criticality software products and solutions enabling customers to develop in the cloud, deploy over the air and run and manage software at the vehicle edge. As described in Note 2. Significant Accounting Policies to the consolidated financial statements contained herein, although the timeline has been extended for the broader transition to more fully software-defined vehicles, as evidenced by certain delays in our OEM customers’ software-defined vehicle investment strategies, we continue to believe we are well-aligned with long-term key industry technology trends and continue to make investments to further develop and grow our product offerings in this space.

Previous wording

While the impacts to the Company resulting from these incremental tariffs were not significant during the first half of 2025, the future impact of any announced tariffs is subject to a number of factors, including the effective date and duration of such tariffs, changes in the amount, scope and nature of the tariffs in the future, any retaliatory responses to such actions that the target countries may take and any mitigating actions that may become available. In addition, we are continuing to work with our customers and suppliers to mitigate the impact of these incremental tariffs on our results of operations. Despite recent trade negotiations and the potential for trade agreements between the U.S. and the Mexican, Canadian and Chinese governments, given the uncertainty regarding the scope and duration of any new tariffs and any associated retaliatory measures, as well as the potential for additional tariffs or trade barriers by the U.S., Mexico, Canada, China or other countries, we can provide no assurance that any strategies we implement to mitigate the impact of such tariffs or other trade actions will be successful. Management continues to monitor the volatile geopolitical environment to identify, quantify and assess proposed or threatened duties, taxes or other business restrictions which could adversely affect our business and financial results.

Current wording

While the impacts to the Company resulting from these incremental tariffs were not significant during the nine months ended September 30, 2025, the future impact of any announced tariffs is subject to a number of factors, including the effective date and duration of such tariffs, changes in the amount, scope and nature of the tariffs in the future, any retaliatory responses to such actions that the target countries may take and any mitigating actions that may become available. In addition, we are continuing to work with our customers and suppliers to mitigate the impact of these incremental tariffs on our results of operations. Despite recent trade negotiations and the potential for trade agreements between the U.S. and the Mexican, Canadian and Chinese governments, given the uncertainty regarding the scope and duration of any new tariffs and any associated retaliatory measures, as well as the potential for additional tariffs or trade barriers by the U.S., Mexico, Canada, China or other countries, we can provide no assurance that any strategies we implement to mitigate the impact of such tariffs or other trade actions will be successful. Management continues to monitor the volatile geopolitical environment to identify, quantify and assess proposed or threatened duties, taxes or other business restrictions which could adversely affect our business and financial results.

Previous wording

We are focused on maintaining a low fixed cost structure that provides us flexibility to remain profitable at all points of the traditional vehicle industry production cycle. As a result, approximately 97% of our hourly workforce is located in best cost countries. Furthermore, we have substantial operational flexibility by leveraging a large workforce of contingent workers, which represented approximately 30% of the hourly workforce as of June 30, 2025. However, we will continue to adjust our cost structure and optimize our manufacturing footprint in response to changes in the global and regional automotive markets and in order to increase investment in advanced technologies and engineering, as evidenced by our ongoing restructuring programs focused on reducing our global overhead costs and on the continued rotation of our manufacturing footprint to best cost locations in Europe and aligning our manufacturing capacity with the current levels of automotive production in each region. As we continue to operate in a cyclical industry that is impacted by movements in the global and regional economies, we continually evaluate opportunities to further refine our cost structure.

Current wording

We are focused on maintaining a low fixed cost structure that provides us flexibility to remain profitable at all points of the traditional vehicle industry production cycle. As a result, approximately 97% of our hourly workforce is located in best cost countries. Furthermore, we have substantial operational flexibility by leveraging a large workforce of contingent workers, which represented approximately 31% of the hourly workforce as of September 30, 2025. However, we will continue to adjust our cost structure and optimize our manufacturing footprint in response to changes in the global and regional automotive markets and in order to increase investment in advanced technologies and engineering, as evidenced by our ongoing restructuring programs focused on reducing our global overhead costs and on the continued rotation of our manufacturing footprint to best cost locations in Europe and aligning our manufacturing capacity with the current levels of automotive production in each region. As we continue to operate in a cyclical industry that is impacted by movements in the global and regional economies, we continually evaluate opportunities to further refine our cost structure.

Previous wording

We have a strong balance sheet with gross debt of approximately $7.9 billion and substantial available liquidity of approximately $4.0 billion as of June 30, 2025, consisting of cash and cash equivalents and available financing under our Revolving Credit Facility and committed European accounts receivable factoring facility, and no significant U.S. defined benefit or workforce postretirement health care benefits and employer-paid postretirement basic life insurance benefits (“OPEB”) liabilities. We intend to maintain strong financial discipline by targeting industry-leading earnings growth, cash flow generation and return on invested capital and to maintain sufficient liquidity to sustain our financial flexibility throughout the industry cycle.

Current wording

We have a strong balance sheet with gross debt of approximately $7.7 billion and substantial available liquidity of approximately $4.2 billion as of September 30, 2025, consisting of cash and cash equivalents and available financing under our Revolving Credit Facility and committed European accounts receivable factoring facility, and no significant U.S. defined benefit or workforce postretirement health care benefits and employer-paid postretirement basic life insurance benefits (“OPEB”) liabilities. We intend to maintain strong financial discipline by targeting industry-leading earnings growth, cash flow generation and return on invested capital and to maintain sufficient liquidity to sustain our financial flexibility throughout the industry cycle.

Previous wording

We typically experience (as described below) fluctuations in operating income due to:

Current wording

We typically experience (as described below) fluctuations in operating (loss) income due to:

Previous wording

Three and Six Months Ended June 30, 2025 versus Three and Six Months Ended June 30, 2024

Current wording

Three and Nine Months Ended September 30, 2025 versus Three and Nine Months Ended September 30, 2024

Previous wording

The results of operations for the three and six months ended June 30, 2025 and 2024 were as follows:

Current wording

The results of operations for the three and nine months ended September 30, 2025 and 2024 were as follows:

Previous wording

Total net sales for the three months ended June 30, 2025 increased 3% compared to the three months ended June 30, 2024. Our volumes increased 2% for the period, which primarily reflects volume growth in Asia Pacific and North America, partially offset by volume declines in Europe, compared to increased global automotive production of 2% (flat on an AWM basis). Our net sales also reflect contractual price reductions, net of price recoveries, of $17 million and favorable foreign currency impacts, primarily related to the Euro.

Current wording

Total net sales for the three months ended September 30, 2025 increased 7% compared to the three months ended September 30, 2024. Our volumes increased 6% for the period, which primarily reflects volume growth in North America and Asia Pacific, partially offset by volume declines in Europe, compared to increased global automotive production of 4% (4% on an AWM basis). Our net sales also reflect the impacts of favorable pricing, net of contractual price reductions, of $8 million and favorable foreign currency impacts, primarily related to the Euro.

Previous wording

Total net sales for the six months ended June 30, 2025 increased 1% compared to the six months ended June 30, 2024. Our volumes increased 1% for the period, which primarily reflects volume growth in Asia Pacific, partially offset by volume declines in Europe, compared to increased global automotive production of 3% (down 1% on an AWM basis). Our net sales also reflect the impact of contractual price reductions, net of price recoveries, of $30 million, and unfavorable foreign currency impacts, primarily related to the Chinese Yuan Renminbi and South Korean Won, partially offset by the Euro.

Current wording

Total net sales for the nine months ended September 30, 2025 increased 3% compared to the nine months ended September 30, 2024. Our volumes increased 2% for the period, which primarily reflects volume growth in North America and Asia Pacific, partially offset by volume declines in Europe, compared to increased global automotive production of 4% (1% on an AWM basis). Our net sales also reflect the impact of contractual price reductions, net of price recoveries, of $22 million, and favorable foreign currency impacts, primarily related to the Euro, partially offset by the Chinese Yuan Renminbi and South Korean Won.

Previous wording

Cost of sales increased $128 million for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, as summarized below. The Company’s material cost of sales was approximately 50% of net sales for both the three months ended June 30, 2025 and 2024.

Current wording

Cost of sales increased $243 million for the three months ended September 30, 2025 compared to the three months ended September 30, 2024, as summarized below. The Company’s material cost of sales was approximately 50% of net sales for both the three months ended September 30, 2025 and 2024.

Previous wording

Cost of sales increased $10 million for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, as summarized below. The Company’s material cost of sales was approximately 50% of net sales for both the six months ended June 30, 2025 and 2024.

Current wording

Cost of sales increased $253 million for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, as summarized below. The Company’s material cost of sales was approximately 50% of net sales for both the nine months ended September 30, 2025 and 2024.

Previous wording

•$23 million of increased commodity pass-through costs.

Current wording

•$63 million of increased commodity pass-through costs;

Previous wording

•Approximately $20 million of increased depreciation, which includes increased long-lived asset impairment charges of $5 million; and

Current wording

•Approximately $20 million of increased depreciation, which includes the absence of long-lived asset impairment charges of $8 million; and

Previous wording

•$15 million of increased warranty costs.

Current wording

•Approximately $15 million of increased warranty costs.

Previous wording

Selling, general and administrative expense (“SG&A”) primarily includes administrative expenses, information technology costs, incentive compensation related costs, separation, acquisition and project portfolio costs and selling and marketing expenses. SG&A remained consistent as a percentage of net sales for the three and six months ended June 30, 2025 compared to 2024. SG&A includes $28 million and $47 million of separation costs during the three and six months ended June 30, 2025, respectively.

Current wording

Selling, general and administrative expense (“SG&A”) primarily includes administrative expenses, information technology costs, incentive compensation related costs, separation, acquisition and project portfolio costs and selling and marketing expenses. SG&A increased as a percentage of net sales for the three months ended September 30, 2025 compared to 2024, primarily due to $53 million of separation costs and the absence of a credit loss recovery of approximately $25 million related to a supply relationship in Europe recognized during the three months ended September 30, 2024. SG&A increased as a percentage of net sales for the nine months ended September 30, 2025 compared to 2024, primarily due to $100 million of separation costs and increased incentive compensation costs.

Previous wording

Amortization expense reflects the non-cash charge related to definite-lived intangible assets. Amortization during the three and six months ended June 30, 2025 and 2024 reflects the continued amortization of our definite-lived intangible assets, which resulted primarily from our acquisitions, over their estimated useful lives.

Current wording

Amortization expense reflects the non-cash charge related to definite-lived intangible assets. Amortization during the three and nine months ended September 30, 2025 and 2024 reflects the continued amortization of our definite-lived intangible assets, which resulted primarily from our acquisitions, over their estimated useful lives.

Previous wording

The Company recorded employee-related and other restructuring charges totaling approximately $52 million and $89 million during the three and six months ended June 30, 2025, respectively, which included the recognition of approximately $12 million and $15 million, respectively, for a program initiated in the fourth quarter of 2024 focused on global salaried workforce optimization, primarily in the European region. The charges recorded during the three and six months ended June 30, 2025 also included the recognition of approximately $9 million and $22 million, respectively, within the Electrical Distribution Systems segment for programs to downsize and close European manufacturing sites. We expect to make cash payments of approximately $110 million over the next twelve months pursuant to currently implemented restructuring programs.

Current wording

The Company recorded employee-related and other restructuring charges totaling approximately $60 million and $149 million during the three and nine months ended September 30, 2025, respectively. The charges recorded during the three months ended September 30, 2025 included the recognition of approximately $25 million related to workforce optimization within the Advanced Safety and User Experience segment and approximately $12 million within the Electrical Distribution Systems segment for programs to downsize European manufacturing sites. The charges recorded during the nine months ended September 30, 2025 included the recognition of approximately $34 million within the Electrical Distribution Systems segment for programs to downsize and close European manufacturing sites and approximately $15 million for a program initiated in the fourth quarter of 2024 focused on global salaried workforce optimization, primarily in the European region. We expect to make cash payments of approximately $135 million over the next twelve months pursuant to currently implemented restructuring programs.

Previous wording

During the three and six months ended June 30, 2024, Aptiv recorded employee-related and other restructuring charges totaling approximately $70 million and $109 million, respectively, which included the recognition of approximately $30 million and $54 million, respectively, for a program initiated in the fourth quarter of 2023 focused on global salaried workforce optimization, primarily in the European region. The charges recorded during the three and six months ended June 30, 2024 also reflected programs to align manufacturing capacity with the current levels of automotive production in North America and Asia Pacific.

Current wording

During the three and nine months ended September 30, 2024, Aptiv recorded employee-related and other restructuring charges totaling approximately $16 million and $125 million, respectively, which reflect programs to align manufacturing capacity with the current levels of automotive production in each region. The charges recorded during the nine months ended September 30, 2024 also included the recognition of approximately $55 million for a program initiated in the fourth quarter of 2023 focused on global salaried workforce optimization, primarily in the European region.

Previous wording

We expect to continue to incur additional restructuring expense in 2025 and beyond, primarily related to programs focused on reducing global overhead costs, the continued rotation of our manufacturing footprint to best cost locations in Europe and aligning manufacturing capacity with the levels of automotive production, which includes approximately $25 million (of which approximately $10 million relates to the Electrical Distribution Systems segment, approximately $10 million relates to the Engineering Components Group segment and approximately $5 million relates to the Advanced Safety and User Experience segment) for programs approved as of June 30, 2025. Additionally, as we continue to operate in a cyclical industry that is impacted by movements in the global and regional economies, we continually evaluate opportunities to further adjust our cost structure and optimize our manufacturing footprint. The Company plans to implement additional restructuring activities in the future, if necessary, in order to align manufacturing capacity and other costs with prevailing regional automotive production levels and locations, to improve the efficiency and utilization of other locations and in order to increase investment in advanced technologies and engineering. Such future restructuring actions are dependent on market conditions, customer actions and other factors.

Current wording

We expect to continue to incur additional restructuring expense in 2025 and beyond, primarily related to programs focused on reducing global overhead costs, the continued rotation of our manufacturing footprint to best cost locations in Europe and aligning manufacturing capacity with the levels of automotive production, which includes approximately $40 million (of which approximately $25 million relates to the Advanced Safety and User Experience segment, approximately $10 million relates to the Engineering Components Group segment and approximately $5 million relates to the Electrical Distribution Systems segment) for programs approved as of September 30, 2025. Additionally, as we continue to operate in a cyclical industry that is impacted by movements in the global and regional economies, we continually evaluate opportunities to further adjust our cost structure and optimize our manufacturing footprint. The Company plans to implement additional restructuring activities in the future, if necessary, in order to align manufacturing capacity and other costs with prevailing regional automotive production levels and locations, to improve the efficiency and utilization of other locations and in order to increase investment in advanced technologies and engineering. Such future restructuring actions are dependent on market conditions, customer actions and other factors.

Previous wording

The increase in interest expense during the three and six months ended June 30, 2025 compared to 2024 primarily reflects the issuance of €750 million in aggregate principal amount of 4.25% Euro-denominated senior unsecured notes due 2036 (the “2024 Euro-denominated Senior Notes”) in June 2024, the issuance of $1,650 million in aggregate principal amount of senior unsecured notes (the “2024 Senior Notes) in September 2024 and the issuance of $500 million in aggregate principal amount of junior subordinated notes (the “2024 Junior Notes”) in September 2024, partially offset by the redemption of the $700 million in aggregate principal amount of 2.396% senior unsecured notes due 2025 (the “2.396% Senior Notes”) in September 2024 and the redemption of the €700 million in aggregate principal amount of 1.50% Euro-denominated senior unsecured notes due 2025 in December 2024. Refer to Note 8. Debt to the consolidated financial statements contained herein for additional information.

Current wording

The increase in interest expense during the nine months ended September 30, 2025 compared to 2024 primarily reflects the issuance of $1,650 million in aggregate principal amount of 2024 Senior Notes and the $500 million in aggregate principal amount of 2024 Junior Notes in September 2024, partially offset by the redemption of the $700 million in aggregate principal amount of 2.396% senior unsecured notes (the “2.396% Senior Notes”) due 2025 in September 2024, the redemption of the 2015 Euro-denominated Senior Notes in December 2024, the full repayment of the $600 million Term Loan A in the fourth quarter of 2024 and first quarter of 2025 and the full repayment of our €450 million European accounts receivable factoring facility in the first half of 2025.

Previous wording

Other income, net for the three months ended June 30, 2025 includes interest income of $13 million. Other income, net for the six months ended June 30, 2025 includes interest income of $24 million, partially offset by a loss on extinguishment of debt of $3 million primarily in conjunction with the repayment of the Term Loan A, as discussed in Note 8. Debt to the consolidated financial statements contained herein.

Current wording

Other income, net for the three months ended September 30, 2025 includes interest income of $23 million and a net gain on debt extinguishment of $3 million recognized in conjunction with the partial repayment of certain senior notes, as discussed in Note 8. Debt to the consolidated financial statements contained herein. Other income, net for the nine months ended September 30, 2025 includes interest income of $47 million.

Previous wording

Net gain on equity method transactions for the three and six months ended June 30, 2025 includes a gain of approximately $33 million recorded as a result of the Motional funding transaction completed in May 2025 and a gain of approximately $13 million from the closing of the sale of TTTech Auto in June 2025.

Current wording

Net gain on equity method transactions for the nine months ended September 30, 2025 includes a gain of approximately $33 million recorded as a result of the Motional funding transaction completed in May 2025 and a gain of approximately $13 million from the closing of the sale of TTTech Auto AG (“TTTech Auto”) in June 2025.

Previous wording

Net gain on equity method transactions for the three and six months ended June 30, 2024 includes a gain of approximately $641 million recorded as a result of the Motional funding and ownership restructuring transactions completed in May 2024.

Current wording

Net gain on equity method transactions for the nine months ended September 30, 2024 includes a gain of approximately $641 million recorded as a result of the Motional funding and ownership restructuring transactions completed in May 2024.

Previous wording

The Company’s effective tax rate for the three and six months ended June 30, 2025 includes net discrete tax benefits of approximately $40 million and net discrete tax expense of approximately $241 million, respectively, primarily related to a change in valuation allowance on the Swiss tax incentive, as described below, partially offset by changes in other valuation allowances and changes in reserves. The Company’s effective tax rate for the three and six months ended June 30, 2024 includes net discrete tax benefits of approximately $27 million and $20 million, respectively, primarily related to a business reorganization that occurred in the second quarter of 2024. Also included as a discrete item in the effective tax rate for the three months ended June 30, 2024 is the beneficial impact of approximately 8 points resulting from the Motional funding and ownership restructuring transactions, as described further in Note 21. Investment in Affiliates. There was no tax expense associated with these gains as Aptiv’s interest in Motional is exempt from capital gains tax in the jurisdiction in which it is owned.

Current wording

The Company’s effective tax rate for the three and nine months ended September 30, 2025 includes net discrete tax expense of approximately $12 million and $253 million, respectively, primarily related to a change in valuation allowance on the Swiss tax incentive, as described below, and the tax impact of legal entity restructuring, partially offset by changes in other valuation allowances and changes in reserves. The effective tax rate for the nine months ended September 30, 2025 also includes an unfavorable impact of approximately 48 points resulting from the Wind River non-cash goodwill impairment charge, as described further in Note 2. Significant Accounting Policies to the consolidated financial statements contained herein, which is non-deductible for tax purposes. The Company’s effective tax rate for the three and nine months ended September 30, 2024 includes net discrete tax benefits of approximately $45 million and $65 million, respectively, primarily related to changes in valuation allowances. Also included as discrete items in the effective tax rate for the nine months ended September 30, 2024 are the beneficial impacts of a business reorganization that occurred in the second quarter of 2024 and approximately 5 points resulting from the Motional funding and ownership restructuring transactions, as described further in Note 21. Investment in Affiliates to the consolidated financial statements contained herein. There was no tax expense associated with the gain on the Motional transactions as Aptiv’s interest in Motional is exempt from capital gains tax in the jurisdiction in which it is owned.

Previous wording

On December 15, 2022, the E.U. Member States formally adopted the Framework, which generally provides for a minimum effective tax rate of 15%, as established by the OECD. Many countries have enacted legislation consistent with the Framework effective at the beginning of 2024. The OECD continues to release additional guidance on these rules. The Company has proactively responded to these tax policy changes and will continue to closely monitor developments. Our effective tax rate for the six months ended June 30, 2025 includes an unfavorable impact from the enacted Framework.

Current wording

On December 15, 2022, the E.U. Member States formally adopted the Framework, which generally provides for a minimum effective tax rate of 15%, as established by the OECD. Many countries have enacted legislation consistent with the Framework effective at the beginning of 2024. The OECD continues to release additional guidance on these rules. The Company has proactively responded to these tax policy changes and will continue to closely monitor developments. Our effective tax rate for the nine months ended September 30, 2025 includes an unfavorable impact from the enacted Framework.

Previous wording

On January 15, 2025, the OECD released Administrative Guidance (the “Guidance) on Article 9.1 of the Global Anti-Base Erosion Model Rules (the “Model Rules”) which amends the Pillar Two Framework. Jurisdictions that have adopted the Framework may implement and administer their domestic laws consistent with the Model Rules and Guidance. The Guidance eliminates the tax basis in certain deferred tax assets including tax credit carryforwards for purposes of the global minimum tax established under the Framework. As a result, the Company no longer expects to obtain significant benefits from the tax incentive granted to its Swiss subsidiary in 2023. Accordingly, the Company recognized an increase to valuation allowances of $294 million to reduce the related deferred tax asset during the six months ended June 30, 2025. No other deferred tax assets are impacted by the Guidance.

Current wording

On January 15, 2025, the OECD released Administrative Guidance (the “Guidance) on Article 9.1 of the Global Anti-Base Erosion Model Rules (the “Model Rules”) which amends the Pillar Two Framework. Jurisdictions that have adopted the Framework may implement and administer their domestic laws consistent with the Model Rules and Guidance. The Guidance eliminates the tax basis in certain deferred tax assets including tax credit carryforwards for purposes of the global minimum tax established under the Framework. As a result, the Company no longer expects to obtain significant benefits from the tax incentive granted to its Swiss subsidiary in 2023. Accordingly, the Company recognized an increase to valuation allowances of $294 million to reduce the related deferred tax asset during the nine months ended September 30, 2025. No other deferred tax assets are impacted by the Guidance.

Previous wording

On July 4, 2025, the One Big Beautiful Bill Act (the “Act”) was enacted into law. The Act includes changes to U.S. tax law that will be applicable to Aptiv beginning in 2025, with additional provisions applying in subsequent years. Included in these changes are favorable adjustments to deductions for interest, qualified property, and research and development expenditures, as well as reforms to the international tax framework. We are in the process of evaluating the impact of the Act on our consolidated financial statements.

Current wording

On July 4, 2025, the One Big Beautiful Bill Act (the “Act”) was enacted into law. The Act includes changes to U.S. tax law that will be applicable to Aptiv beginning in 2025, with additional provisions applying in subsequent years. Included in these changes are favorable adjustments to deductions for interest, qualified property, and research and development expenditures, as well as reforms to the international tax framework. The Act will not have a material impact on the Company’s consolidated financial statements.

Previous wording

Equity loss, net of tax reflects the Company’s interest in the results of ongoing operations of entities accounted for as equity method investments. The decrease in equity losses recognized by Aptiv during the three and six months ended June 30, 2025 compared to 2024 is primarily attributable to the decrease in Aptiv’s common equity interest in Motional from 50% to approximately 13% as a result of the Motional funding and ownership restructuring transactions that were completed in May 2024 and May 2025. Refer to Note 21. Investments in Affiliates to the consolidated financial statements contained herein for additional information.

Current wording

Equity loss, net of tax reflects the Company’s interest in the results of ongoing operations of entities accounted for as equity method investments. The decrease in equity losses recognized by Aptiv during the nine months ended September 30, 2025 compared to 2024 is primarily attributable to the decrease in Aptiv’s common equity interest in Motional from 50% to approximately 13% as a result of the Motional funding and ownership restructuring transactions that were completed in May 2024 and May 2025. Refer to Note 21. Investments in Affiliates to the consolidated financial statements contained herein for additional information.

Previous wording

Our management utilizes Adjusted Operating Income as the key performance measure of segment income or loss to evaluate segment performance, and for planning and forecasting purposes to allocate resources to the segments, as management believes this measure is most reflective of the operational profitability or loss of our operating segments. Segment Adjusted Operating Income should not be considered a substitute for results prepared in accordance with U.S. GAAP and should not be considered an alternative to net income attributable to Aptiv, which is the most directly comparable financial measure to Adjusted Operating Income that is prepared in accordance with U.S. GAAP. Segment Adjusted Operating Income, as determined and measured by Aptiv, should also not be compared to similarly titled measures reported by other companies. Refer to Note 19. Segment Reporting to the consolidated financial statements contained herein for additional information.

Current wording

Our management utilizes Adjusted Operating Income as the key performance measure of segment income or loss to evaluate segment performance, and for planning and forecasting purposes to allocate resources to the segments, as management believes this measure is most reflective of the operational profitability or loss of our operating segments. Segment Adjusted Operating Income should not be considered a substitute for results prepared in accordance with U.S. GAAP and should not be considered an alternative to net (loss) income attributable to Aptiv, which is the most directly comparable financial measure to Adjusted Operating Income that is prepared in accordance with U.S. GAAP. Segment Adjusted Operating Income, as determined and measured by Aptiv, should also not be compared to similarly titled measures reported by other companies. Refer to Note 19. Segment Reporting to the consolidated financial statements contained herein for additional information.

Previous wording

Net sales, gross margin as a percentage of net sales and Adjusted Operating Income by segment for the three and six months ended June 30, 2025 and 2024 are as follows:

Current wording

Net sales, gross margin as a percentage of net sales and Adjusted Operating Income by segment for the three and nine months ended September 30, 2025 and 2024 are as follows:

Previous wording

As noted in the table above, Adjusted Operating Income for the three months ended June 30, 2025 as compared to the three months ended June 30, 2024 was impacted by operational performance, volume, including product mix, as well as the impacts of contractual price reductions, net of price recoveries, of $17 million. Adjusted Operating Income was also impacted by the following items included within Other in the table above:

Current wording

As noted in the table above, Adjusted Operating Income for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024 was impacted by operational performance, volume, including product mix, as well as the impacts of favorable pricing, net of contractual price reductions, of $8 million. Adjusted Operating Income was also impacted by the following items included within Other in the table above:

Previous wording

•$53 million of unfavorable foreign currency impacts, primarily related to the Mexican Peso; and

Current wording

•$33 million of unfavorable foreign currency impacts, primarily related to the Mexican Peso; and

Previous wording

As noted in the table above, Adjusted Operating Income for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024 was impacted by operational performance, volume, including product mix, as well as the impacts of contractual price reductions, net of price recoveries, of $30 million. Adjusted Operating Income was also impacted by the following items included within Other in the table above:

Current wording

As noted in the table above, Adjusted Operating Income for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024 was impacted by operational performance, volume, including product mix, as well as the impacts of contractual price reductions, net of price recoveries, of $22 million. Adjusted Operating Income was also impacted by the following items included within Other in the table above:

Previous wording

•$69 million of unfavorable foreign currency impacts, primarily related to the Mexican Peso and Chinese Yuan Renminbi;

Current wording

•$102 million of unfavorable foreign currency impacts, primarily related to the Mexican Peso;

Previous wording

•$15 million of increased SG&A expense, not including the impact of separation costs and other acquisition and portfolio project costs; and

Current wording

•Approximately $60 million of increased SG&A expense, including increased incentive compensation costs, excluding the impact of separation costs and other acquisition and portfolio project costs;

Previous wording

•Approximately $10 million of increased depreciation, primarily as a result of a higher fixed asset base.

Current wording

•Approximately $30 million of increased depreciation, primarily as a result of a higher fixed asset base; and

Previous wording

As of June 30, 2025, we had cash and cash equivalents of $1.4 billion and net debt (defined as outstanding debt less cash and cash equivalents) of $6.3 billion. The following table summarizes our available liquidity, which includes cash, cash equivalents and funds available under our significant committed credit facilities, as of June 30, 2025:

Current wording

As of September 30, 2025, we had cash and cash equivalents of $1.6 billion and net debt (defined as outstanding debt less cash and cash equivalents) of $6.0 billion. The following table summarizes our available liquidity, which includes cash, cash equivalents and funds available under our significant committed credit facilities, as of September 30, 2025: