The auto supplier reported second-quarter adjusted earnings per share of $1.42, up 17.4% from a year earlier, while keeping its 2026 sales, margin and cash flow guidance unchanged.
BorgWarner reported second-quarter 2026 results showing modest sales growth, stronger profitability and a higher full-year adjusted earnings outlook, even as it pointed to softer vehicle production and a decline in Battery Energy Systems sales. U.S. GAAP net sales rose 0.3% from a year earlier to $3,648 million, while organic net sales fell 1.2%; excluding a roughly $60 million drop in Battery Energy Systems revenue, organic sales were up modestly. Net earnings attributable to BorgWarner increased to $277 million, or $1.34 per diluted share, from $224 million, or $1.03, a year earlier. Adjusted earnings per diluted share rose 17.4% to $1.42 from $1.21, while adjusted operating income reached $413 million and adjusted operating margin improved to 11.3% from 10.3%. The company said cost controls helped support performance in a weaker industry production environment. It repurchased about $100 million of shares in the quarter and paid a $34 million cash dividend. Its Board of Directors also increased the share repurchase authorization by $1 billion to about $1.35 billion in total, with the program intended to support repurchases through 2029. For 2026, BorgWarner raised adjusted earnings guidance to $5.05 to $5.30 per diluted share from a previous range of $5.00 to $5.20, citing the impact of share repurchases in the first half. It maintained expected net sales of $14.0 billion to $14.3 billion, U.S. GAAP operating margin of 9.6% to 9.8%, adjusted operating margin of 10.7% to 10.9%, operating cash flow of $1,600 million to $1,700 million and free cash flow of $900 million to $1,100 million. The outlook assumes weighted light vehicle markets will range from down 3% to approximately flat and includes an expected roughly $250 million year-over-year sales decline in Battery Energy Systems, equal to about a 1.7% headwind to organic net sales growth. BorgWarner also highlighted new business awards across its portfolio, including eTurbo, torque-on-demand transfer case, variable cam timing, Integrated Drive Modules and inverter extension programs, while saying it plans to increase 2026 research and development spending to support future growth in data center and industrial markets.