Earnings call transcript: Garrett Motion Q3 2025 beats forecasts, stock surges

Garrett Motion Inc. (Market cap: $2.87 billion) reported strong third-quarter 2025 financial results, surpassing expectations with an EPS of $0.38, compared to the forecasted $0.32. This 18.75% earnings surprise was accompanied by actual revenue of $902 million, exceeding the forecast of $857.95 million. According to InvestingPro data, the company maintains a GREAT financial health score of 3.06, supported by robust profitability metrics. In pre-market trading, Garrett Motion’s stock surged by 19.3%, reflecting investor optimism.

Key Takeaways

• Garrett Motion’s Q3 2025 EPS exceeded forecasts by 18.75%.
• Revenue rose to $902 million, a 6% increase at constant currency.
• The company’s stock price jumped 19.3% in pre-market trading.
• Garrett Motion raised its 2025 net sales outlook midpoint to $3.55 billion.
• Strong growth in gasoline turbo sales and advancements in zero-emission technologies were highlighted.

Company Performance

Garrett Motion demonstrated robust performance in the third quarter of 2025, with net sales reaching $902 million, marking a 6% increase at constant currency. The company reported an adjusted EBIT of $133 million, representing a 14.7% margin. This performance underscores the company’s strategic focus on expanding its product offerings and enhancing operational efficiency. The automotive industry outlook for the latter half of 2025 appears favorable, further supporting Garrett Motion’s growth trajectory.

Financial Highlights

• Revenue: $902 million, up 6% year-over-year
• Earnings per share: $0.38, exceeding the forecast of $0.32
• Adjusted EBIT: $133 million (14.7% margin)
• Adjusted free cash flow: $107 million

Earnings vs. Forecast

Garrett Motion’s actual EPS of $0.38 surpassed the forecast of $0.32, resulting in an 18.75% earnings surprise. Revenue also exceeded expectations, coming in at $902 million versus the forecasted $857.95 million, a 5.13% surprise. This marks a significant achievement for the company, reflecting its effective cost management and strategic growth initiatives.

Market Reaction

Following the earnings announcement, Garrett Motion’s stock surged by 19.3% in pre-market trading, reaching $14.925. This sharp increase in stock price reflects positive investor sentiment and confidence in the company’s future prospects. The stock’s performance is notable given its proximity to the 52-week high of $15.32, indicating strong market support.

Outlook & Guidance

Garrett Motion has raised its 2025 net sales outlook midpoint to $3.55 billion. The company remains focused on advancing its zero-emission technologies, aiming for $1 billion in revenue from this segment by 2030. Strategic initiatives include expanding into industrial applications and maintaining a strong position in the diesel turbochargers market.

Executive Commentary

• Olivier Rabiller, CEO, noted, "We are seeing a huge growth on the gasoline side, 10%."
• Sean Deason, CFO, stated, "We are last man standing on the turbos for diesel."
• Rabiller also highlighted, "We are extending our range with bigger turbos, but we are already doing a significant business in that field."

Risks and Challenges

• Supply chain disruptions could impact production schedules.
• Competitive pressures in the zero-emission technology sector.
• Macroeconomic uncertainties affecting the automotive industry.
• Fluctuations in currency exchange rates impacting international sales.
• Potential regulatory changes in emissions standards.

Q&A

During the earnings call, analysts inquired about the company’s strategy for zero-emission technologies and the impact of gasoline and commercial vehicle segments on the product mix. Executives clarified their capital allocation approach, emphasizing a target of returning 75% of free cash flow to shareholders.

Full transcript - Garrett Motion Inc (GTX) Q3 2025:

Megan, Conference Call Operator: Hello, my name is Megan, and I will be your operator this morning. I would like to welcome everyone to the Garrett Motion Third Quarter 2025 Financial Results Conference Call. This call is being recorded, and a replay will be available later today. After the company’s presentation, there will be a Q&A session. I would now like to hand the call over to Cyril Grandjean, Garrett’s Vice President, Investor Relations and Treasurer.

Cyril Grandjean, Vice President, Investor Relations and Treasurer, Garrett Motion: Thank you, Megan. Good day and welcome, everyone. Thank you for attending the Garrett Motion Third Quarter 2025 Financial Results Conference Call. Before we begin, I would like to mention that today’s presentation and earnings press release are available on the IR section of Garrett Motion’s website at investors.garrettmotion.com. There, you will also find links to our SEC filings, along with other important information about the company. We note that this presentation contains forward-looking statements within the meaning of the U.S. Federal Securities Laws. These statements, which can be identified by words such as anticipate, intend, plan, believe, expect, may, should, or similar expressions, represent management’s current expectations and are subject to various risks and uncertainties that could cause our actual results to differ materially from such expectations.

These risks and uncertainties include the factors identified in our annual report on Form 10-K and all the filings with the Securities and Exchange Commission, and include risks related to the automotive industry, competitive landscape, and macroeconomic and geopolitical conditions, among others. Please review the disclaimers on slide two of our presentation, as the content of our call will be governed by this language. Today’s presentation also includes certain non-GAAP measures, which we use to help describe how we manage and operate our business. We reconcile each of these measures to the most directly comparable GAAP measure in the appendix of our presentation and related press release. Finally, in today’s presentation and comments, we may refer to light vehicle diesel and light vehicle gasoline products by using the terms diesel and gasoline only.

With us today are Olivier Rabiller, Garrett’s President and Chief Executive Officer, and Sean Deason, Garrett’s Senior Vice President and Chief Financial Officer. I will now hand the call over to Olivier.

Olivier Rabiller, President and Chief Executive Officer, Garrett Motion: Thank you, Cyril. Thank you all for joining the call today. I am pleased to report that Garrett delivered another set of strong financial results in the third quarter, thanks to increased sales in a more stable production environment and disciplined operational execution. Net sales for the third quarter were $902 million, up 6% at constant currency. This growth reflects outperformance over the industry in light vehicle turbo sales for both gasoline and diesel applications. In fact, our gasoline sales grew by 10% in the quarter, driven by our share of demand gains. Thanks to continued productivity and higher volumes, we achieved another quarter of very solid operating performance. Adjusted EBIT was $133 million, and our adjusted EBIT margin was 14.7%, which includes a 20 basis point dilution of the margin rate from tariff recoveries. We also delivered strong adjusted free cash flow of $107 million for the quarter.

These results, combined with an improved forecast for the automotive industry for the second half of the year, have enabled us to raise our 2025 outlook midpoint. In addition, we continue to allocate capital in line with our strategic framework and our commitment to delivering value to shareholders. During the third quarter, we accelerated our share repurchase activity, buying back $84 million of common stock. We also paid a $12 million quarterly dividend. Moreover, our board of directors just approved a 33% increase in our dividend, raising it to $0.08 per share for the fourth quarter. Now, let me move to slide four to share more about Garrett’s continued success across our differentiated technologies. We continue to see growing interest in developing turbochargers for hybrids and range-extended electric vehicles. This quarter, we secured several additional awards for these technologies.

In addition, we obtained several awards for commercial vehicles and industrial turbochargers in various regions, including over $40 million for products supporting stationary power generation or gensets. Demand for such units continues to grow, fueled by the global expansion of data centers in which gensets are installed for backup power generation. Sales of these products are expected to exceed $100 million in 2025 and represent an important growth opportunity for Garrett. This quarter, we also continued to make progress in developing our differentiated zero-emission products. We secured additional proof of concepts with two OEMs in Japan and China for our high-speed three-in-one e-power train. In addition, on the eco-link side, we progressed with the development of our oil-free centrifugal high-speed compressor technology for industrial and mobility applications. We see strong momentum with customers for our e-compressor technology, which is driving significant efficiency gains when tested against current industrial technologies.

All in all, I’m extremely pleased with our ability to deliver strong financial results while continuing to position the company for years of growth. I will now hand it over to Sean, who will provide more details on our financial results and outlook.

Sean Deason, Senior Vice President and Chief Financial Officer, Garrett Motion: Thanks, Olivier, and good morning, everyone. I will begin my remarks on slide five. As Olivier highlighted, we delivered strong financial performance in the third quarter. Our net sales were $902 million, driven by new gasoline launches and ramp-ups across key regions, favorable foreign currency impacts, and tariff recoveries, partially offset by continued weakness in aftermarket. We delivered $133 million of adjusted EBIT in the quarter, equating to a 14.7% margin. This represents both a year-over-year and a sequential increase, resulting from ongoing operational productivity gains that helped to offset an unfavorable product mix. Finally, adjusted free cash flow was $107 million as the business continues to convert earnings into cash. Now moving to slide six, we show our Q3 net sales bridge by product category as compared with the same period last year.

In the quarter, net sales increased by $76 million versus the prior year, or 9% on a reported basis and 6% on a constant currency basis, reflecting favorable foreign currency impacts. We continue to experience strong gasoline growth, outperforming the industry. This growth is driven by continued share of demand gains and new launches and ramp-ups across Europe, China, India, and Brazil. Within diesel, we experienced strong performance in both Europe and North America. This was partially offset by lower demand for aftermarket applications, primarily in North America. Additionally, we recovered $12 million of tariffs within the quarter. Turning to slide seven, during the quarter, we generated $133 million in adjusted EBIT, representing a $16 million increase from the same period last year. This represents a margin rate of 14.7%, which is a 50 basis point improvement year over year.

The increase in adjusted EBIT was primarily driven by increased volumes and the continued benefits of sustained fixed cost actions and variable cost productivity taken in the current and prior year. These increases were partially offset by an unfavorable mix driven by the strength in light vehicle gasoline applications. In the quarter, the impact of newly implemented tariffs drove a 20 basis point decline in the margin rate. Additionally, we benefited from a $9 million contribution, or 60 basis points, from favorable foreign currency impacts year over year. Turning now to slide eight, I’ll walk you through the adjusted EBIT to adjusted free cash flow bridge for the quarter. We delivered a strong adjusted free cash flow of $107 million.

This was due primarily to increased volumes and efficient conversion of earnings into cash, which was partially offset by changes in working capital, driven by timing of payables and higher inventory due to increased volumes. Cash taxes, capital expenditures, depreciation, and cash interest were all in line with our expectations. Now moving to slide nine, we ended the quarter with a liquidity position of $862 million, consisting of $630 million in undrawn capacity from our revolving credit facility and $232 million in unrestricted cash. I am pleased to report that during the quarter, both Fitch and S&P have upgraded Garrett Motion’s ratings by one notch for their corporate family rating, considering not only our reduced net leverage but also acknowledging the substantial reduction in private equity ownership due to recent sell-downs by some of our top equity shareholders.

Additionally, as announced today, we made an early voluntary repayment of $50 million on our term loan, reducing gross leverage. Moving to slide 10, in the third quarter, our strong cash generation allowed us to repurchase $84 million worth of shares, including 5 million shares directly from Oaktree Capital, our largest shareholder. We continue to target distribution of 75% of our adjusted free cash flow to shareholders over time through dividends and share repurchases, the latter of which will vary over time and will depend on various factors, including macroeconomic and industry conditions. As Olivier mentioned earlier today, given our strong financial position, our board approved an increase to our quarterly dividend for the fourth quarter, rising 33% from $0.06 to $0.08 per share, which will be payable in December of 2025. I’ll now transition to slide 11 to discuss our 2025 outlook.

We are raising our midpoint outlook for 2025 to reflect the improved forecast for the automotive industry in the second half and the impact of tariffs on sales and adjusted EBIT margin net of recovery. This revised outlook now implies the following midpoints: net sales of $3.55 billion, flat to plus 1% constant currency, net income of $280 million, adjusted EBIT of $510 million, net cash provided by operating activities of $415 million, and adjusted free cash flow of $385 million. With that, I’ll now turn the call back to Olivier for his closing remarks.

Olivier Rabiller, President and Chief Executive Officer, Garrett Motion: Thanks, Sean. Now let’s turn to slide 12. Our strategic priorities remain clear and consistent. We aim to identify and deliver on customer needs by leveraging our capabilities to develop differentiated, high-speed, and highly efficient technologies. In doing so, we generate robust returns for our shareholders. Let me wrap this up on our final slide, slide 13. First, we delivered strong Q3 results fueled by share of demand gains in gasoline, outperforming the industry, and this coupled with disciplined operational execution. We also generated $107 million of adjusted free cash flow in the quarter and $264 million year to date. This strong cash flow generation allowed us to invest in growing our turbo and zero-emission technologies. To date, we continue to win greater than 50% of our new turbo business awards, as we have done over the last five years.

Additionally, we see increased interest in stationary power generation, and we are expecting over $100 million of sales this year from these industrial applications. I am also very pleased with the progress we have made this year on our zero-emission technologies, with the first series production award for our high-speed e-power train, which demonstrates the substantial potential of this technology. Momentum and interest continue to build for our high-speed oil-free eco-link centrifugal compressor with customer testing, demonstrating significant efficiency gains compared to current technologies. This year, we refinanced and repriced our term loan, lowering our interest by 75 basis points, and repaid $50 million of this debt this month. We also initiated a quarterly dividend of $0.06 per share in Q1 and announced an increase to $0.08 per share for Q4. In addition, we repurchased $136 million of our common shares through Q3.

These actions demonstrate our continued commitment to return capital to shareholders. I am very proud to highlight these achievements, positioning us extremely well for the remainder of 2025 and beyond. Thank you for your time, and operator, we are now ready for Q&A.

Megan, Conference Call Operator: We will now begin the question and answer session. To ask a question, you may press star, then one on your telephone keypad. If you are using speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star, then two. At this time, we will pause momentarily to assemble our roster. Our first question comes from Edison Yu with Deutsche Bank. Please go ahead.

Morning, guys. James Mahalan on for Edison. Congrats on the good quarter. Just looking at the volumes for the quarter, they were good, but they were fully offset by the mix. I was wondering if you could double-click on what you’re seeing in there. Is it geographic-based, or is it something you’re expecting to continue as diesel penetration falls relative to gas? Is there anything we should be specifically thinking about there?

Olivier Rabiller, President and Chief Executive Officer, Garrett Motion: Let me pick that up. That’s a very good question. It’s an opportunity for us to clarify. The mix that we see, the impact, is much more coming by two things. First, commercial vehicle versus growth on gasoline and gasoline turbos. Second, some weakness we keep on seeing on the aftermarket. Let me explain that. We are seeing, as we have said, a huge growth on the gasoline side, 10%. Obviously, we know that those products, especially when they come from China, when they go for China, are not exactly at the same margin as the rest of the business. This is the first mix impact. We keep on seeing continuedness on the commercial vehicle side in some regions, although I would say it’s stabilizing. We are seeing some green shoots, which makes us a bit more confident for the future.

Last but not least, we said that aftermarket was also subject to some weakness. In aftermarket, the piece that so far has been weak this year is commercial vehicle off-highway aftermarket, where there is some destocking going on at some of our customers. As the activity stabilizes, we expect that this will still go on for some time and then at some point recover. These are the three drivers. The first driver, at the end of the day, is a very good driver for us because it’s meaning that we are quite successful versus the rest of the industry, especially in a region that is extremely demanding in terms of competitiveness. The two others, obviously, for us, it’s much more cyclical effects that are impacting ourselves. Obviously, like any cycle, at some point, they will recover.

Got it. Okay. Thank you very much. Just as a quick second question, then I’ll hop back in the line. On that commercial vehicle green shoots comment, is that going to be geographic-based? Are you seeing some strength in certain areas or on off-highway versus class eight? Is there any more detail that you can give there, or is the outlook still pretty soft, broad-based? Just some high-level thoughts on that, if you wouldn’t mind.

It’s pretty soft, broad-based, but we have seen some signs of stabilization in China, which is a big region for us. We should expect some stabilization, although at a low level. At some point, I guess it’s marking the bottom of the cycle on off-highway. When I say off-highway, it’s mostly agricultural and construction equipment.

Okay, thanks, guys.

I see, as we said so far, the commercial vehicle piece that we count for industrial, which are the largest turbochargers we produce, is going quite well in comparison to the rest.

Megan, Conference Call Operator: Our next question comes from Nathan Jones with Stifel. Please go ahead.

Good morning, everyone.

Sean Deason, Senior Vice President and Chief Financial Officer, Garrett Motion: Hi, Nathan.

I’d like to talk a bit about the zero-emission technologies and the progress there. I know you guys have targeted $1 billion of revenue in 2030. Obviously, that number is quite low these days or today as you’re in development. Can you maybe talk about the path that you’re expecting to take from here to that $1 billion of revenue in 2030 and how we should think about you announcing project wins that actually turn into the platform revenues and just how we view the path of that over the next few years?

Olivier Rabiller, President and Chief Executive Officer, Garrett Motion: That’s a good question and gives me an opportunity to one more time re-explain what we do there. First, we have three technologies that are counting towards that goal of zero-emission technology revenue. The first one is fuel cell compressors. Although the fuel cell compressor industry is impacted by the slowdown that we’ve seen on fuel cell compressor in terms of ramp-up, that’s already something that we are doing. Quite frankly, it was not the major part of the $1 billion that we had announced. Therefore, the slowdown that we have seen so far is just having a marginal impact on that. Most of the $1 billion is coming from the two other technologies. The first one, e-power train. As you have seen, we have announced wins, and the biggest one being the Honda. I say Honda and not Hyundai for some people that would make the confusion.

Honda is a commercial vehicle player that belongs to the Weichai Galaxy. It’s the biggest maker of axles and electric axles, not only for China but also for exports. In China, the industry already exists for electric trucks and is growing. We are not subject to the slowdown of BEV, passenger vehicle, that we have seen in North America and the slowdown of the growth that we have seen in Europe. We are pleased with that. It keeps on growing. We have more to come for both passenger vehicle and commercial vehicle, knowing that the first launch, which is associated to the first award, will come in 2027 and then ramp up from there. From the beginning, we’ve said that on e-power train, we would start in 2027 and ramp up from there. We are fully aligned at this stage with the trajectory that we have laid out.

Obviously, we are monitoring very closely the developments of the penetration in different countries, subject obviously to the end market in which we are playing. The last one, which is eco-link compressors, we are quite positive about. At the beginning, we are really betting a lot on what we call mobile application, which is eco-link compressors for electric vehicles, mostly commercial vehicles, for both battery cooling and also vehicle cooling. When you think about buses, we are still seeing a strong traction there. What we have seen over the last few months, and that’s what we wanted to highlight in our earnings today, is that we’ve seen an increasing interest from the industrial world.

Think about air conditioning systems that are on rooftop, up to some of the systems that are used in some data centers, where we have demonstrated that the technology we bring is having superior performance to what is existing and is using some innovations that are quite unique for us because we leverage the maturity that we have achieved on fuel cell to address fuel cell compressor to address a new vertical. We are coming with the strengths of the size of the auto industry, and we are coming from the strengths of the maturity that you need to achieve in the auto industry when you start production. I’m extremely positive about this one, which is getting us into the industrial world out of the automotive world. We cannot say much more than that at this stage, but results are extremely promising, and the interest of customers is quite high.

Thanks for that. In terms of the pre-development contracts that you’ve got going on in there, is there any color you can give us on timing of when you expect those to become actual awards, and what the timing might be on the start of production on those kinds of things?

Usual timing when you start on pre-production, yes. It’s about, I would say, it depends on the customer, but it can be a few months to one year and a half, two years before we decide to go into production. You may remember that we’ve announced already some pre-production awards already some time ago. Obviously, there are some of them that are getting now much more mature, although we are not ready to announce anything. For the rest, it will come later on. What’s important is that when customers get into these programs with you, they are already committing energy, resources, and money to help you assess and develop the technology. That’s already a first very good sign of confidence.

It may be just one more on that. The margin profile for these products as they ramp up, do they start off maybe below corporate average and as volume improves, you get them to a higher level, or will they be immediately accretive to the company? Just any color you can give us on the margin profile of these zero-emission products. Thanks.

The way we measure that is what we call a material margin. The margin we make between the total cost of the product and the price. What we have always said, and we’ll keep on repeating that because we have more and more proof points around it, is that on average, it’s about the same or accretive to what we have on the turbo side.

Thanks very much for taking my questions.

Megan, Conference Call Operator: Our next question comes from Hamed Khorsand with BWS Financial. Please go ahead.

Hi. Could you just elaborate on, you know, the recovery you saw in diesel, please?

Sean Deason, Senior Vice President and Chief Financial Officer, Garrett Motion: That was a year-over-year recovery, mainly in Europe and in North America. Diesel still overall is trending down slowly over time, but not nearly to the magnitude we saw back a few years ago. Diesel still is a very strong business for us. We will be last man standing on the turbos for diesel. It’s a vertical that has basically 100% penetration on turbo, and it’s a business we like very much.

Olivier Rabiller, President and Chief Executive Officer, Garrett Motion: Let me add to what Sean is saying. The big decrease we’ve seen on diesel was basically linked to the shift on passenger vehicle from diesel to other technologies like gasoline and hybrid. We are more and more, as we have been reducing that share of the business, coming to the end of it. With volumes of diesel remaining, much more focused on what I would call light commercial vehicle application, think about delivery vans, pickup trucks, especially in Asia. All these vehicles are diesel, even in China. Today, the trend is that most of it will stay in diesel for the long run due to the specifics of diesel, which are associated with range, gas consumption, as well as the torque that you need to move diesel.

Okay. Olivier, if I heard you right, you said there’s about $100 million this year from industrial use. Is that going into data center? If not, when does that get implemented in helping your sales?

That’s a good one because we introduced that information for this quarter. Let me explain what we mean by that. Even before we launched the meg line of turbochargers, the big line that we launched about one year and a half ago, we were already doing a lot of very big turbochargers according to our range that were fitted on gensets. What we’ve isolated this quarter is this number to give people a little bit of a view that already today, even at the start of the meg ramp-up, we are already doing $100 million in that field, supplying those turbos that are on gensets. Most of them are going already today to the backup power for data centers. We are not just venturing into something from scratch.

We are extending our range with bigger turbos, but we are already doing a significant business in that field through our customers, whether in China, Europe, or the U.S., by the way.

Okay, I appreciate it. Thank you.

Megan, Conference Call Operator: If you have a question, please press star, then one. Our next question comes from Jake Scholl with BNP Paribas. Please go ahead.

Hey, guys. Congrats on the great quarter. I appreciate you guys providing the color on your stationary power revenue. As that business continues to ramp for you guys, especially as we see more demand for things like data centers and you roll out the potential industrial applications of your eco-link centrifugal compressor, what could that business look like if we look out to 2030 or even 2035?

Olivier Rabiller, President and Chief Executive Officer, Garrett Motion: That’s a very good question. I may not give you right away an answer with a number on this one, but let’s keep in mind that first, it’s growing and it’s growing fast, obviously from a smaller base. We’ve mentioned the $100 million for stationary power application. It’s already a significant increase. It’s already a double-digit increase versus last year. More to come. The eco-link centrifugal compressor, that’s also a little bit premature to tell you exactly the numbers as we are really working on that with our customers. If we work on something we expect it to be significant. I don’t think it will represent 50% of the sales of the company by any means, but that will be significant in the grand scheme of things. Yeah.

Thank you. You guys delivered some very impressive capital returns this quarter, between dividends and buybacks totaling nearly $100 million. Is that what we should expect to see going forward, obviously, with some quarter-to-quarter variability? Thank you.

Sean Deason, Senior Vice President and Chief Financial Officer, Garrett Motion: Yeah. As I highlighted in my prepared remarks, we remain committed to 75% or more over time. That will vary, as you noted, especially on share buybacks quarter to quarter, depending upon macroeconomic and industry conditions. We continue to focus in on returning the cash that we’re generating to shareholders. That’s a core part of our financial framework.

Olivier Rabiller, President and Chief Executive Officer, Garrett Motion: The answer is yes.

Sean Deason, Senior Vice President and Chief Financial Officer, Garrett Motion: Thank you.

Megan, Conference Call Operator: Our next question comes from Eric Gregg with Four Tree Island Advisory. Please go ahead.

Tremendous quarter, everyone. Two questions. One is on the eco-link centrifugal compressor technologies for data center and industrial. What are the performance or form factor or potential pricing attributes that you think will make this technology potentially very appealing to potential customers? The second question is, forgive this, but a little bit more on capital allocation. I echo the points made by the prior caller about how strong a quarter it was. This year, you’re down a little bit year to date on stock repurchase versus last year, and you have a lot more liquidity than you did last year. Should we be looking forward to potentially another very strong quarter in stock repurchase specifically, or more weighted towards debt payback, even with this $50 million debt paydown? Thank you.

Olivier Rabiller, President and Chief Executive Officer, Garrett Motion: Yeah. Eric, I answered your first question, and I’m sure Sean will answer your second one. Back to the eco-link question, what makes our product differentiated versus what already exists? A few things. First, we are using high-speed electric motors. We are compressing at a high speed. With high speed in compression comes efficiency. We have an expertise into high speed, and our concept shows extremely low level of noise. At the end of the day, weight, efficiency, noise, and we are leveraging a technology. Now I’m getting a little bit technical, where the system rotates on a cushion of air that we call airfoil bearing that we have developed for the automotive industry. We have developed that for fuel cell compressors. We are uniquely positioned in the industry because we have the scale of the automotive industry. We have the maturity from a manufacturing standpoint.

It’s a very complex, high-volume manufacturing to achieve that. From a design, from a manufacturing standpoint, we have an edge with this system. If you think about the capabilities of the company, high speed, high speed electric motors, and then everything that revolves around rotating technology, in this case, this famous air cushion bearing, are key points for our product. That is, as to provide a benefit to our customers at the end. Back to what I’ve said, it’s weight. Sometimes these systems are on the roof of buildings, so weight is important. More importantly, efficiency. Any kind of % you can save on electric consumption, especially nowadays with the pressure that everybody has to reduce their energy consumption, is a big deal.

The maturity of our product versus some others, putting all that in the context of a world that is evolving when it comes to low global warming refrigerants that need to be used moving forward. We are coming at the right point in time where the industry is looking for improvements in the face of a change that is driven by these low global warming refrigerants. It feels that the benefits that we bring to mobile applications are obviously extremely applicable to the buildings and the industrial applications as well. Now, on the question about capital allocation.

Sean Deason, Senior Vice President and Chief Financial Officer, Garrett Motion: Okay, Eric. As everyone knows, it’s a volatile industry that we’re in right now with new news every day, both from governments and the supply chain. We are committed to returning capital to shareholders. We’re not going to commit to any specific number. We’ve just raised our dividend, had a very strong quarter of share buyback, and repaid a little bit of debt. Those are our three levers, and we expect to continue to use them going forward over time.

Olivier Rabiller, President and Chief Executive Officer, Garrett Motion: To get to our goal, on average, on terms, 75%.

Sean Deason, Senior Vice President and Chief Financial Officer, Garrett Motion: Correct.

Olivier Rabiller, President and Chief Executive Officer, Garrett Motion: Thank you very much.

Megan, Conference Call Operator: Thank you for joining Garrett Motion’s Q3 earnings call. This concludes today’s session.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.