Commercial Vehicle Group, Inc.

Previous wording

The discussion and analysis below described material changes in financial condition and results of operations as reflected in our condensed consolidated financial statements for the three and six months ended June 30, 2025 and 2024. This discussion and analysis should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our 2024 Form 10-K.

Current wording

The discussion and analysis below described material changes in financial condition and results of operations as reflected in our condensed consolidated financial statements for the three and nine months ended September 30, 2025 and 2024. This discussion and analysis should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our 2024 Form 10-K.

Previous wording

The Company announced on June 27, 2025, it had closed on $210 million in senior secured credit facilities, consisting of (i) a $95 million senior secured Term Loan with TCW Group, as agent, and (ii) a $115 million senior secured asset-based revolving credit facility with Bank of America, N.A., as agent. Obligations under the new senior secured credit facilities will mature on June 27, 2030, with the ABL revolving credt facility springing to 91 days prior to the maturity of the Term Loan or third-party subordinated debt.

Current wording

The Company announced on June 27, 2025, it had closed on $210 million in senior secured credit facilities, consisting of (i) a $95 million senior secured Term Loan with TCW Group, as agent, and (ii) a $115 million senior secured asset-based revolving credit facility with Bank of America, N.A., as agent. Obligations under the new senior secured credit facilities will mature on June 27, 2030, with the ABL revolving credit facility springing to 91 days prior to the maturity of the Term Loan or third-party subordinated debt.

Previous wording

In connection with the financing, TCW Group affiliates received five-year warrants for the purchase of up to 3,934,776 shares of the company’s common stock, issued in two equal tranches. The tranches of warrants have an exercise price of $1.52 and $2.07 per share, respectively. Until the fourth anniversary after issuance, the Company has the right to repurchase up to 50% of each tranche of warrants at a price equal to $1.40 or $1.00 per share, respectively, above the applicable exercise price. Upon a refinancing of the new credit agreement, the holders can require the Company to repurchase up to 50% of each tranche at a price equal to the stock price of the common stock at the time of repurchase less the exercise price. The warrants contain customary anti-dilution adjustments. The Company has provided the holders with certain information and registration rights, including agreeing to file a registration statement within 45 days to register the resale of the shares underlying the warrants.

Current wording

In connection with the financing, TCW Group affiliates received five-year warrants for the purchase of up to 3,934,776 shares of the company’s common stock, issued in two equal tranches. The tranches of warrants have an exercise price of $1.52 and $2.07 per share, respectively. Until the fourth anniversary after issuance, the Company has the right to repurchase up to 50% of each tranche of warrants at a price equal to $1.40 or $1.00 per share, respectively, above the applicable exercise price. Upon a refinancing of the new credit agreement, the holders can require the Company to repurchase up to 50% of each tranche at a price equal to the price of the common stock at the time of repurchase less the exercise price. The warrants contain customary anti-dilution adjustments. The Company has provided the holders with certain information and registration rights, including agreeing to file a registration statement within 45 days to register the resale of the shares underlying the warrants.

Previous wording

We are navigating through several external factors which create uncertainty and volatility in our end markets, including, but not limited to, geopolitical dynamics, new tariff actions, tax regulation and fluctuating foreign exchange rates. The Company’s cost of goods sold could be increased by tariffs which could subsequently increase the price of goods purchased and sold to customers. The Company expects to pass on the costs of tariffs, if any, to its customers, although there is significant uncertainty. Geopolitical uncertainties will continue to create a challenging operating environment. We continue to closely monitor the situation and are prepared to remain agile in responding to any new developments.

Current wording

We are navigating through several challenging external factors which create uncertainty and volatility in our end markets, including, but not limited to, geopolitical dynamics, new tariff actions and responses, tax regulation and fluctuating foreign exchange rates. We expect the Company’s cost of goods sold will continue to be impacted by tariffs which increase the price of goods purchased and sold to customers. The Company expects to continue to pass on the costs of tariffs to its customers, although there is significant uncertainty as to our ability to recover these costs from our customers. Geopolitical uncertainties will continue to create a challenging operating environment. We continue to closely monitor the situation and are prepared to remain agile in responding to any new developments.

Previous wording

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”), which includes a broad range of tax reform provisions, was signed into law in the United States. Key provisions of the bill include, but are not limited to, immediate expensing of R&E expenditures, restoration and expansion of 100% bonus depreciation and permanent reinstatement of the EBITDA limitation for the calculation of the 163(j) business interest expense deduction. Additionally, the bill extends and modifies certain international tax provisions of the 2017 Tax Cuts and Jobs Act that were set to expire at the end of 2025. The Company continues to evaluate the impact of the new legislation but does not expect the OBBBA to have a material impact on the Company’s consolidated financial statements.

Current wording

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”), which includes a broad range of tax reform provisions, was signed into law in the United States. Key provisions of the bill include, but are not limited to, immediate expensing of R&E expenditures, restoration and expansion of 100% bonus depreciation and permanent reinstatement of the EBITDA limitation for the calculation of the 163(j) business interest expense deduction. Additionally, the bill extends and modifies certain international tax provisions of the 2017 Tax Cuts and Jobs Act that were set to expire at the end of 2025. The Company continues to evaluate the impact of the new legislation but does not expect the OBBBA to have a material impact on the Company’s consolidated financial statements or results of operations.

Previous wording

•a $20.8 million, or 12.9%, decrease in OEM and other sales;

Current wording

•a $16.7 million, or 11.9%, decrease in OEM and other sales;

Previous wording

•a $0.9 million, or 2.8%, decrease in aftermarket and OES sales.

Current wording

•a $2.6 million, or 8.4%, decrease in aftermarket and OES sales.

Previous wording

The decrease in revenues of 11.2% is due primarily to a softening in customer demand across Global Seating and Trim Systems & Components segments.

Current wording

The decrease in revenues of 11.2% is due primarily to a softening in customer demand in North America.

Previous wording

Gross Profit. Included in gross profit is cost of revenues, which consists primarily of raw materials and purchased components for our products, wages and benefits for our employees and overhead expenses such as manufacturing supplies, facility rent and utilities costs related to our operations. The $0.9 million decrease in gross profit is primarily attributable to the impact of lower sales volumes. Cost of revenues decreased $20.8 million, or 12.0%, as a result of a decrease in raw material and purchased component costs of $13.1 million, or 12.7%, and a decrease in labor and overhead expenses of $7.7 million, or 11.0%. As a percentage of revenues, gross profit margin was 11.4% for the three months ended June 30, 2025 compared to 10.6% for the three months ended June 30, 2024. The three months ended June 30, 2025 results include charges of $1.1 million associated with restructuring programs, compared to $5.1 million for the three months ended June 30, 2024.

Current wording

Gross Profit. Included in gross profit is cost of revenues, which consists primarily of raw materials and purchased components for our products, wages and benefits for our employees and overhead expenses such as manufacturing supplies, facility rent and utilities costs related to our operations. The $0.4 million decrease in gross profit is primarily attributable to the impact of lower sales volumes. Cost of revenues decreased $18.9 million, or 12.2%, as a result of a decrease in raw material and purchased component costs of $13.4 million, or 15.1%, and a decrease in labor and overhead expenses of $5.5 million, or 8.2%. As a percentage of revenues, gross profit margin was 10.5% for the three months ended September 30, 2025 compared to 9.6% for the three months ended September 30, 2024. The three months ended September 30, 2025 results include charges of $2.4 million associated with restructuring programs, compared to $3.5 million for the three months ended September 30, 2024.

Previous wording

Selling, General and Administrative Expenses. Selling, general and administrative ("SG&A") expenses consist primarily of wages and benefits and other expenses such as marketing, travel, legal, audit, rent and utilities costs, which are not directly or indirectly associated with the manufacturing of our products. SG&A expenses decreased $0.7 million compared to the three months ended June 30, 2024, primarily as a result of a decrease in incentive compensation expense. As a percentage of revenues, SG&A expense was 10.9% and 10.0% for the three months ended June 30, 2025 and 2024, respectively.

Current wording

Selling, General and Administrative Expenses. Selling, general and administrative ("SG&A") expenses consist primarily of wages and benefits and other expenses such as marketing, travel, legal, audit, rent and utilities costs, which are not directly or indirectly associated with the manufacturing of our products. SG&A expenses decreased $0.4 million compared to the three months ended September 30, 2024, primarily as a result of a decrease in incentive compensation expense and restructuring charges; offset by a $3.5 million gain on the sale of a building included in the prior year period. As a percentage of revenues, SG&A expense was 11.2% and 10.2% for the three months ended September 30, 2025 and 2024, respectively.

Previous wording

Other (Income) Expense. Other expense increased $0.2 million in the three months ended June 30, 2025 compared to the three months ended June 30, 2024.

Current wording

Other (Income) Expense. Other expense increased $2.0 million in the three months ended September 30, 2025 compared to the three months ended September 30, 2024, primarily related to fees we received under the transition services agreement of $2.0 million recognized during the three months ended September 30, 2024.

Previous wording

Interest Expense. Interest associated with our debt was relatively flat on a lower average debt balance, at $2.3 million and $2.4 million for the three months ended June 30, 2025 and 2024, respectively.

Current wording

Interest Expense. Interest associated with our debt increased $1.7 million, at $4.1 million and $2.4 million for the three months ended September 30, 2025 and 2024, respectively. The increase in interest expense was primarily attributed to higher weighted average margins on debt balances.

Previous wording

Provision for Income Taxes. Income tax expense of $1.7 million and benefit of $0.3 million was recorded for the three months ended June 30, 2025 and 2024, respectively. The primary driver in the effective tax rate change is the company's losses in the U.S. while maintaining its full valuation allowance position on U.S. deferred tax assets.

Current wording

Provision for Income Taxes. Income tax expense of $0.7 million and benefit of $1.5 million was recorded for the three months ended September 30, 2025 and 2024, respectively. The primary driver in the effective tax rate change is the Company's losses in the U.S. while maintaining its full valuation allowance position on U.S. deferred tax assets.

Previous wording

Net Income (Loss) from continuing operations. Net loss from continuing operations was $4.1 million for the three months ended June 30, 2025 compared to net loss of $1.3 million for the three months ended June 30, 2024. The decrease in net income is attributable to the factors noted above.

Current wording

Net Income (Loss) from continuing operations. Net loss from continuing operations was $6.8 million for the three months ended September 30, 2025 compared to net loss of $0.9 million for the three months ended September 30, 2024. The decrease in net income is attributable to the factors noted above.

Previous wording

Revenues. The decrease in Global Seating Segment revenues of $15.3 million was primarily driven by decreased customer demand.

Current wording

Revenues. The decrease in Global Seating Segment revenues of $7.9 million was primarily driven by lower sales volume as a result of softening customer demand in North America.

Previous wording

As a percentage of revenues, gross profit margin was 12.9% for the six months ended June 30, 2025 compared to 13.2% for the six months ended June 30, 2024, driven by lower sales volume and increased freight costs. The six months ended June 30, 2025 results include charges of $0.4 million associated with the restructuring program, compared to $0.8 million for the six months ended June 30, 2024.

Current wording

As a percentage of revenues, gross profit margin was 12.4% for the three months ended September 30, 2025 compared to 10.1% for the three months ended September 30, 2024. The three months ended September 30, 2025 results include charges of $1.3 million associated with restructuring programs, compared to $0.8 million for the three months ended September 30, 2024.

Previous wording

Selling, General and Administrative Expenses. SG&A expenses decreased $1.3 million for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, primarily as a result of reduced incentive compensation expense and headcount reduction.

Current wording

Selling, General and Administrative Expenses. SG&A expenses decreased $2.2 million for the three months ended September 30, 2025 compared to the three months ended September 30, 2024, primarily as a result of reduced incentive compensation expense and headcount reduction.

Previous wording

Gross Profit. The decrease in gross profit of $2.3 million was primarily attributable to lower sales volumes. The decrease in cost of revenues was driven by a decrease in raw material and purchased component costs of $7.7 million, or 23.5%, and a decrease in labor and overhead expenses of $3.8 million, or 19.9%.

Current wording

Gross Profit. The increase in gross profit of $2.3 million was primarily attributable to volume and mix. The increase in cost of revenues was driven by an increase in raw material and purchased component costs of $1.5 million, or 7.1%, and a decrease in labor and overhead expenses of $1.1 million, or 5.0%.

Previous wording

Gross Profit. The increase in gross profit of $1.9 million was primarily attributable to lower start-up and restructuring costs. The cost of revenues decreased in line with the sales decrease of 0.1%, driven by a decrease in labor and overhead expenses of $2.4 million, or 9.9%; and an increase in raw material and purchased component costs of $0.5 million, or 1.9%.

Current wording

Gross Profit. The decrease in gross profit of $3.5 million was primarily attributable to lower sales volume. The cost of revenues decreased in line with the sales decrease of 29.2%, driven by a decrease in labor and overhead expenses of $4.1 million, or 22.9%; and a decrease in raw material and purchased component costs of $6.6 million, or 26.4%.

Previous wording

As a percentage of revenues, gross profit margin was 11.0% for the three months ended June 30, 2025 compared to 7.4% for the three months ended June 30, 2024. The increase in gross profit margin was primarily due to lower start-up and restructuring costs in the current year compared to the prior year, offset by lower sales volume. The three months ended June 30, 2025 results include charges of $0.5 million associated with the restructuring program, compared to $2.5 million for the three months ended June 30, 2024.

Current wording

As a percentage of revenues, gross profit margin was 6.4% for the three months ended September 30, 2025 compared to 11.8% for the three months ended September 30, 2024. The decrease in gross profit margin was primarily due to lower sales volume. The three months ended September 30, 2025 results include charges of $0.6 million associated with restructuring programs, compared to $1.5 million for the three months ended September 30, 2024.

Previous wording

The table below sets forth certain consolidated operating data for the six months ended June 30, (dollars are in thousands):

Current wording

The table below sets forth certain consolidated operating data for the nine months ended September 30, (dollars are in thousands):

Previous wording

•a $44.4 million, or 13.8%, decrease in OEM and other revenues; and

Current wording

•a $61.0 million, or 13.2%, decrease in OEM and other revenues; and

Previous wording

•a $2.2 million, or 3.3%, decrease in aftermarket and OES sales.

Current wording

•a $4.8 million, or 4.9%, decrease in aftermarket and OES sales.

Previous wording

The decrease in revenues of $46.5 million is primarily driven by a softening in customer demand across all segments.

Current wording

The decrease in revenues of $65.8 million was primarily driven by a softening in customer demand across all segments.

Previous wording

Selling, General and Administrative Expenses. SG&A expenses decreased $2.9 million compared to the six months ended June 30, 2024, primarily as a result of a decrease in incentive compensation expense. As a percentage of revenues, SG&A expense was 10.3% for the six months ended June 30, 2025 compared to 9.8% for the six months ended June 30, 2024. The six months ended June 30, 2025 results include charges of $0.2 million associated with the restructuring programs, compared to $0.4 million for the six months ended June 30, 2024.

Current wording

Selling, General and Administrative Expenses. SG&A expenses decreased $3.3 million compared to the nine months ended September 30, 2024, primarily as a result of a decrease in incentive compensation expense. As a percentage of revenues, SG&A expense was 10.6% for the nine months ended September 30, 2025 compared to 9.9% for the nine months ended September 30, 2024. The nine months ended September 30, 2025 results include charges of $0.5 million associated with the restructuring programs, compared to $1.1 million for the nine months ended September 30, 2024.

Previous wording

Provision (benefit) for Income Taxes. Income tax expense of $3.8 million and $0.4 million were recorded for the six months ended June 30, 2025 and 2024, respectively. The primary driver in the effective tax rate change is the company's losses in the U.S. while maintaining its full valuation allowance position on U.S. deferred tax assets.

Current wording

Provision (benefit) for Income Taxes. Income tax expense of $4.5 million and benefit of $1.1 million were recorded for the nine months ended September 30, 2025 and 2024, respectively. The primary driver in the effective tax rate change is the Company's losses in the U.S. while maintaining its full valuation allowance position on U.S. deferred tax assets.

Previous wording

Net Income (loss) from continuing operations. Net loss from continuing operations was $7.2 million for the six months ended June 30, 2025 compared to net income of $0.1 million for the six months ended June 30, 2024. The decrease in net income is attributable to the factors noted above.

Current wording

Net Income (loss) from continuing operations. Net loss from continuing operations was $14.1 million for the nine months ended September 30, 2025 compared to net loss of $0.7 million for the nine months ended September 30, 2024. The decrease is attributable to the factors noted above.

Previous wording

The table below sets forth certain Global Seating Segment operating data for the six months ended June 30, (dollars are in thousands):

Current wording

The table below sets forth certain Global Seating Segment operating data for the nine months ended September 30, (dollars are in thousands):

Previous wording

Revenues. The decrease in Global Seating Segment revenues of $7.9 million was primarily driven by decreased customer demand.

Current wording

Revenues. The decrease in Global Seating Segment revenues of $23.3 million was primarily driven by decreased customer demand in North America.

Previous wording

Selling, General and Administrative Expenses. SG&A expenses decreased $3.0 million for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, primarily as a result of reduced incentive compensation expense and headcount reduction.

Current wording

Selling, General and Administrative Expenses. SG&A expenses decreased $4.5 million for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, primarily as a result of reduced incentive compensation expense and headcount reduction.

Previous wording

The table below sets forth certain Global Electrical Systems Segment operating data for the six months ended June 30, (dollars are in thousands):

Current wording

The table below sets forth certain Global Electrical Systems Segment operating data for the nine months ended September 30, (dollars are in thousands):

Previous wording

Revenues. The decrease in Global Electrical Systems Segment revenues of $8.3 million was primarily driven by decreased customer demand.

Current wording

Revenues. The decrease in Global Electrical Systems Segment revenues of $5.6 million was primarily driven by decreased customer demand.

Previous wording

The table below sets forth certain Trim Systems and Components Segment operating data for the six months ended June 30, (dollars are in thousands):

Current wording

The table below sets forth certain Trim Systems and Components Segment operating data for the nine months ended September 30, (dollars are in thousands):

Previous wording

Revenues. The decrease in Trim Systems and Components Segment revenues in 2025 of $13.7 million was primarily driven by decreased customer demand.

Current wording

Revenues. The decrease in Trim Systems and Components Segment revenues of $37.0 million was primarily driven by decreased customer demand in North America.

Previous wording

As a percentage of revenues, gross profit margin was 9.5% for the six months ended June 30, 2025 compared to 7.8% for the six months ended June 30, 2024. This was primarily due to lower start-up and restructuring costs. The six months ended June 30, 2025 results include charges of $1.0 million associated with the restructuring program, compared to $2.5 million for the six months ended June 30, 2024.

Current wording

As a percentage of revenues, gross profit margin was 8.5% for the nine months ended September 30, 2025 compared to 12.0% for the nine months ended September 30, 2024. This was primarily due to lower sales volume. The nine months ended September 30, 2025 results include charges of $0.9 million associated with restructuring programs, compared to $3.3 million for the nine months ended September 30, 2024.

Previous wording

Our primary sources of liquidity as of June 30, 2025 were operating income, cash and availability under our credit facility. We believe that these sources of liquidity will provide adequate funds for our working capital needs, capital expenditures and debt service throughout the next twelve months. However, no assurance can be given that this will be the case. We also rely on the timely collection of receivables as a source of liquidity. As of June 30, 2025, we had outstanding letters of credit of $1.1 million and borrowing availability of $90.6 million from our U.S. and China credit facilities (subject to customary borrowing base and other conditions), in addition to $45.3 million of cash.

Current wording

Our primary sources of liquidity as of September 30, 2025 were operating income, cash and availability under our credit facility. We believe that these sources of liquidity will provide adequate funds for our working capital needs, capital expenditures and debt service throughout the next twelve months. However, no assurance can be given that this will be the case. We also rely on the timely collection of receivables as a source of liquidity. As of September 30, 2025, we had outstanding letters of credit of $1.1 million and borrowing availability of $96.5 million from our U.S. and China credit facilities (subject to customary borrowing base and other conditions), in addition to $31.3 million of cash.

Previous wording

As of June 30, 2025, cash of $30.7 million was held by foreign subsidiaries. The Company had a$0.1 million deferred tax liability as of June 30, 2025 for theexpected future income tax implications of repatriating cash from the foreign subsidiaries for which indefinite reinvestment is not expected.

Current wording

As of September 30, 2025, cash of $31.3 million was held by foreign subsidiaries. The Company had a$0.2 million deferred tax liability as of September 30, 2025 for theexpected future income tax implications of repatriating cash from the foreign subsidiaries for which indefinite reinvestment is not expected.

Previous wording

Operating activities. For the six months ended June 30, 2025, net cash provided by operating activities was $34.0 million compared to net cash provided by operating activities of $10.2 million for the six months ended June 30, 2024. Net cash provided by operating activities is primarily attributable to a decrease in trade working capital and net loss for the six months ended June 30, 2025 as compared to a lesser decrease in trade working capital for the six months ended June 30, 2024.

Current wording

Operating activities. For the nine months ended September 30, 2025, net cash provided by operating activities was $32.4 million compared to net cash used in operating activities of $6.8 million for the nine months ended September 30, 2024. Net cash provided by operating activities is primarily attributable to a decrease in trade working capital and net loss for the nine months ended September 30, 2025 as compared to a lesser decrease in trade working capital for the nine months ended September 30, 2024.

Previous wording

Investing activities. For the six months ended June 30, 2025, net cash used in investing activities was $5.3 million compared to $8.1 million for the six months ended June 30, 2024. The change was mainly due to less capital spending in the current year, combined with $3.2 million proceeds from the sale of the Company's FinishTEK business received during the first quarter of 2024 offsetting capital expenditures. In 2025, we expect capital expenditures to be in the range of $10 million to $15 million.

Current wording

Investing activities. For the nine months ended September 30, 2025, net cash used in investing activities was $7.0 million compared to cash provided by investing activities of $12.9 million for the nine months ended September 30, 2024. The change was mainly due to less capital spending in the current year, combined with $23.0 million proceeds from the sale of the Company's cab structures and FinishTEK businesses during the prior year period and $4.5 million proceeds from the sale of a building during the 2024 offsetting capital expenditures. In 2025, we expect capital expenditures to be in the range of $9 million to $12 million.

Previous wording

Financing activities. For the six months ended June 30, 2025, net cash used in financing activities was $12.2 million compared to net cash provided by financing activities of $0.4 million for the six months ended June 30, 2024. Use of cash in financing activities during the six months ended June 30, 2025 was primarily attributable to the cost of refinancing our debt which totaled $6.1 million and the net reduction of our debt of $6.0 million.

Current wording

Financing activities. For the nine months ended September 30, 2025, net cash used in financing activities was $22.7 million compared to net cash used in financing activities of $12.9 million for the nine months ended September 30, 2024. Use of cash in financing activities during the nine months ended September 30, 2025 was primarily attributable to the cost of refinancing our debt which totaled $6.1 million and the net reduction of our debt of $16.3 million.