Lear Q4 Earnings Beat Expectations, Revenues Increase Y/Y

Lear Corp. LEA reported fourth-quarter 2025 adjusted earnings per share of $3.41, which beat the Zacks Consensus Estimate of $2.67, thanks to better-than-expected revenues from the Seating and E-Systems segments. The bottom line also increased from $2.94 reported in the year-ago quarter. In the reported quarter, revenues increased 5% year over year to $6 billion and surpassed the Zacks Consensus Estimate of $5.80 billion.

Lear Corporation Price, Consensus and EPS Surprise

Lear Corporation price-consensus-eps-surprise-chart | Lear Corporation Quote

Lear’s Segmental Performance

Sales of the Seating segment totaled $4.41 billion in the reported quarter, up from $4.19 billion generated in the year-ago quarter. The segment’s sales also surpassed the Zacks Consensus Estimate of $4.24 billion. Adjusted segment earnings amounted to $263 million, up from $257 million reported in the corresponding quarter of 2024 and beat the Zacks Consensus Estimate of $243 million. The segment recorded an adjusted margin of 6% of sales, down from 6.1% recorded in the previous year’s quarter.

Sales of the E-Systems segment totaled $1.58 billion, rising from $1.53 billion in the year-ago period and also topping the Zacks Consensus Estimate of $1.53 billion. Adjusted segmental earnings amounted to $83.7 million, up from $76.7 million in the corresponding quarter of 2024. The figure also surpassed the Zacks Consensus Estimate of $70 million. For the E-Systems segment, the adjusted margin was 5.3% of sales, up from 5% in the year-ago quarter.

LEA’s Performance by Region

Sales in the North America region increased 6% year over year to $2.46 billion in the quarter under review and surpassed the Zacks Consensus Estimate of $2.39 billion.

Sales in the Europe and Africa region rose 3% year over year to $2.04 billion, marginally missing the Zacks Consensus Estimate of $2.05 billion.

Sales in the Asia region totaled $1.26 billion in the quarter, which increased 4.5% year over year and surpassed the Zacks Consensus Estimate of $1.16 billion.

Sales in the South America region totaled $232.3 million in the quarter, rising from $213.5 million generated in the year-ago period and exceeding the Zacks Consensus Estimate of $217 million.

Financial Position & Other Tidbits of Lear

The company had $1.03 billion in cash and cash equivalents as of Dec. 31, 2025, compared with $1.05 billion as of Dec. 31, 2024. Long-term debt was $2.71 billion as of Dec. 31, 2025, slightly down from $2.73 billion as of Dec. 31, 2024.

During the quarter under discussion, net cash provided by operating activities totaled $476 million. The company posted an FCF of $281 million in the quarter.

During the quarter, LEA repurchased 1,632,456 shares of its common stock for a total of $175 million. At the end of the quarter, Lear had a remaining share repurchase authorization of nearly $775 million.

LEA Provides 2026 Guidance

Lear projects its full-year net sales in the band of $23,210-$24,010 million compared to $23,259 million reported in 2025. Core operating earnings are envisioned in the range of $1.03-$1.2 billion compared to $1.06 billion in 2025. FCF is projected in the band of $550-$650 million, higher than the $427 million reported in 2025. Capital spending is expected to be $660 million compared to $561 million in 2025. Adjusted EBITDA is expected to be between $1.65 billion and $1.82 billion.

Lear’s Zacks Rank & Key Picks

LEA carries a Zacks Rank #3 (Hold) at present.

Some better-ranked stocks in the auto space are Modine Manufacturing Company MOD, Ford Motor Company F and PHINIA Inc. PHIN, each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for MOD’s fiscal 2026 sales and earnings implies year-over-year growth of 17.2% and 14.3%, respectively. The EPS estimate for fiscal 2026 has improved a penny in the past 60 days. The EPS estimate for fiscal 2027 has improved 13 cents in the past seven days.

The Zacks Consensus Estimate for F’s 2025 sales implies year-over-year growth of 0.3%. EPS estimates for 2025 and 2026 have improved 7 cents and 11 cents, respectively, in the past 30 days.

The Zacks Consensus Estimate for PHIN’s 2025 sales and earnings implies year-over-year growth of 1.1% and 33.4%, respectively. EPS estimates for 2025 and 2026 have improved 47 cents and 66 cents, respectively, in the past 60 days. 

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This article originally published on Zacks Investment Research (zacks.com).

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