Q2 2025 Aptiv PLC Earnings Call

July 31, 2025

Jess: Please stand by. We are about to begin. Good day and welcome to the Aptiv Q2 2025 earnings call. Today's conference is being recorded. At this time, I would like to turn the conference over to Betsy Frank, Vice President, Investor Relations. Please go ahead.

Operator: Please stand by. We're about to begin. Good day and welcome to the Aptiv Q2 2025 earnings call. Today's conference is being recorded. At this time, I would like to turn the conference over to Betsy Frank, Vice President, Investor Relations. Please go ahead.

Please stand by. We're about to begin.

Good day and welcome to the Aptiv Q2 2025 earnings call.

Today's conference is being recorded.

Betsy Frank: Thank you, Jess. Good morning, and thank you for joining Aptiv's Q2 2025 earnings conference call. The press release and related tables, along with the slide presentation, can be found on the Investor Relations portion of our website at aptiv.com. Today's review of our financials excludes amortization, restructuring, and other special items, and will address the continuing operations of Aptiv. The reconciliations between GAAP and non-GAAP measures are included at the back of the slide presentation, and the earnings press release. Unless otherwise stated, all references to growth rates are on a year-over-year basis. During today's call, we will be providing certain forward-looking information that reflects Aptiv's current view of future financial performance and may be materially different for reasons that we cite in our Form 10-K and other SEC filings.

Betsy Frank: Thank you, Jess. Good morning, and thank you for joining Aptiv's second quarter 2025 earnings conference call. The press release and related tables, along with the slide presentation, can be found on the Investor Relations portion of our website at aptiv.com. Today's review of our financials excludes amortization, restructuring, and other special items, and will address the continuing operations of Aptiv. The reconciliations between GAAP and non-GAAP measures are included at the back of the slide presentation and the earnings press release. Unless otherwise stated, all references to growth rates are on a year-over-year basis. During today's call, we will be providing certain forward-looking information that reflects Aptiv's current view of future financial performance and may be materially different for reasons that we cite in our Form 10-K and other SEC filings.

At this time, I would like to turn the conference over to Betsy Frank, Vice President of Investor Relations. Please go ahead.

Thank you, Jess. Good morning. And thank you for joining at this second quarter 2025 earnings conference call.

The press release and related tables, along with the slide presentation, can be found on the investor relations portion of our website at aptive.com.

Today's review of our financials excludes amortization, restructuring, and other special items.

And we'll address the continuing operations of active.

The reconciliations between gaap and non-gaap measures are included at the back of the slide presentation and the earnings press release.

To growth rates are on a year-over-year basis.

During today's call, we will be providing certain forward-looking information that reflects active's current view of future financial performance,

Betsy Frank: Joining us today will be Kevin Clark, Aptiv's Chair and Chief Executive Officer, and Varun Laroya, Executive Vice President and Chief Financial Officer. Kevin will provide a strategic update on the business, and Varun will cover the financial results in more detail before we open the call to Q&A. With that, I'd like to turn the call over to Kevin.

Joining us today will be Kevin Clark, Aptiv's Chair and Chief Executive Officer, and Varun Laroya, Executive Vice President and Chief Financial Officer. Kevin will provide a strategic update on the business, and Varun will cover the financial results in more detail before we open the call to Q&A. With that, I'd like to turn the call over to Kevin.

Betsy Frank: Joining us today will be Kevin Clark, Aptiv's Chair and Chief Executive Officer, and Varun Laroyia, Executive Vice President and Chief Financial Officer. Kevin will provide a strategic update on the business, and Varun will cover the financial results in more detail before we open the call to Q&A. With that, I'd like to turn the call over to Kevin.

And may be materially different for reasons that we cite and our form 10K and other SEC filings.

Joining us today will be Kevin Clark, apd's chair, and chief executive officer and Varan, Loya Executive, Vice, President and Chief Financial Officer.

Kevin will provide a strategic update on the business and Barren will cover the financial results in more detail. Before we open the call to Q&A.

Kevin Clark: Thanks, Betsy. Thanks, everyone, for joining us this morning. Excuse me. Starting on slide three, we had a solid quarter both operationally and financially. Our strong business foundation, coupled with strength in the underlying markets we serve, enabled us to produce record second quarter results. Our unique capabilities from the sensor to the cloud provide our customers with flexibility and scalability while further strengthening our competitive moat. Our product portfolio is aligned to the accelerating trends of electrification, automation, and digitalization that are happening across multiple industries, and it's reflected in our new business bookings. Over the last decade, we've built a resilient business model that has enabled us to operate efficiently even in this dynamic environment. We leverage our global scale while executing in region, for region, close to our customers in the most important geographic markets around the world.

Kevin Clark: Thanks, Betsy. Thanks, everyone, for joining us this morning. Excuse me. Starting on slide three, we had a solid quarter both operationally and financially. Our strong business foundation, coupled with strength in the underlying markets we serve, enabled us to produce record second-quarter results. Our unique capabilities from the center to the cloud provide our customers with flexibility and scalability, while further strengthening our competitive mode. Our product portfolio is aligned to the accelerating trends of electrification, automation, and digitalization that are happening across multiple industries, and it is reflected in our new business bookings. Over the last decade, we have built a resilient business model that has enabled us to operate efficiently, even in this dynamic environment. We leverage our global scale while executing in region, for region, close to our customers in the most important geographic markets around the world.

With that, I'd like to turn the call over to Kevin. Thanks, Betsy. Uh, thanks everyone for joining us this morning. Excuse me, starting on slide 3, we had a solid quarter both operationally and financially. Our strong business foundation, coupled with strengths in the underlying markets we serve, enabled us to produce record second quarter results. Our unique capabilities from the center to the cloud provide our customers with flexibility and scalability.

While further strengthening our competitive mode. Our product portfolio is aligned to the accelerating trends of electrification Automation and digitalization that are happening across multiple Industries, and it's reflected in our new business, bookings.

Over the last decade, we've built a resilient business model that has enabled us to operate efficiently, even in this dynamic environment.

Kevin Clark: We are constantly working to increase the efficiency of our operations and further optimize our cost structure, which allows us to remain agile, respond quickly to changes, and closely partner with our suppliers and customers to avoid any production disruptions. I am proud to tell you that as a result of those efforts, we received the Volkswagen Group Award for Resilient Supply Chains during the quarter. The recognition reflects the real-time, end-to-end visibility that we have across our global supply network that is enabled by the digital twin we have built over the last five years, giving us the ability to react quickly and keep our customers connected. Lastly, with a focus on maximizing shareholder value, the spin-off of Electrical Distribution Systems remains on track, and we look forward to sharing more information on our progress at the upcoming Investor Day in November.

Kevin Clark: We're constantly working to increase the efficiency of our operations and further optimize our cost structure, which allows us to remain agile, respond quickly to changes, and closely partner with our suppliers and customers to avoid any production disruptions. I'm proud to tell you that as a result of those efforts, we received the Volkswagen Group Award for resilient supply chains during the quarter. The recognition reflects the real-time end-to-end visibility that we have across our global supply network that's enabled by the Digital Twin we have built over the last five years, giving us the ability to react quickly and keep our customers connected. Lastly, with a focus on maximizing shareholder value, the spinoff of Electrical Distribution Systems remains on track, and we look forward to sharing more information on our progress at the upcoming Investor Day in November.

We're constantly working to increase the efficiency of our operations and further optimize our cost structure, which allows us to remain agile, respond quickly to changes, and closely partner with our suppliers and customers to avoid any production disruptions. I'm proud to tell you that as a result of those efforts, we received the Volkswagen Group Award for resilient supply chains during the quarter. The recognition reflects the real-time end-to-end visibility that we have across our global supply network that's enabled by the Digital Twin we have built over the last five years, giving us the ability to react quickly and keep our customers connected. Lastly, with a focus on maximizing shareholder value, the spinoff of Electrical Distribution Systems remains on track, and we look forward to sharing more information on our progress at the upcoming Investor Day in November.

We leverage our global scale while executing in Region 4, close to our customers. In the most important geographic markets around the world, we're constantly working to increase the efficiency of our operations and further optimize our cost structure, which allows us to remain agile, respond quickly to changes, and closely partner with our suppliers and customers to avoid any production disruptions.

I'm proud to tell you that as a result of those efforts, we received the Volkswagen group award for resilient Supply chains during the quarter.

The recognition reflects the real-time, end-to-end visibility that we have across our Global Supply Network, enabled by the digital twin we have built over the last five years.

Giving us the ability to react quickly and keep our customers connected.

Kevin Clark: Moving to our results, our second-quarter revenue growth of 2% reflects strength across multiple areas of our business and the benefit of stronger-than-expected vehicle production in the North American market. Operating income totaled $628 million, reflecting flow-through on volume growth and strong operating performance, more than offsetting significant headwinds related to foreign exchange and commodity prices. When combined with the lower share count resulting from our recently completed accelerated share repurchase program, it drove record earnings per share. Lastly, we generated $510 million of operating cash flow, further strengthening our balance sheet and providing us with capital allocation flexibility. Barron will discuss each of these elements in more detail later.

Kevin Clark: Moving to our results, our second quarter revenue growth of 2% reflects strength across multiple areas of our business and the benefit of stronger-than-expected vehicle production in the North American market. Operating income totaled $628 million, reflecting flow-through on volume growth and strong operating performance, more than offsetting significant headwinds related to foreign exchange and commodity prices. When combined with the lower share count resulting from our recently completed accelerated share repurchase program, it drove record earnings per share. Lastly, we generated $510 million of operating cash flow, further strengthening our balance sheet and providing us with capital allocation flexibility. Varun will discuss each of these elements in more detail later. Moving to slide four to review our second quarter new business bookings, our portfolio of advanced technologies and industry-leading supply chain capabilities led to $5.4 billion of new business awards, positioning us for another year of strong bookings.

Moving to our results, our second quarter revenue growth of 2% reflects strength across multiple areas of our business and the benefit of stronger-than-expected vehicle production in the North American market. Operating income totaled $628 million, reflecting flow-through on volume growth and strong operating performance, more than offsetting significant headwinds related to foreign exchange and commodity prices. When combined with the lower share count resulting from our recently completed accelerated share repurchase program, it drove record earnings per share. Lastly, we generated $510 million of operating cash flow, further strengthening our balance sheet and providing us with capital allocation flexibility. Varun will discuss each of these elements in more detail later. Moving to slide four to review our second quarter new business bookings, our portfolio of advanced technologies and industry-leading supply chain capabilities led to $5.4 billion of new business awards, positioning us for another year of strong bookings.

Lastly, with a focus on maximizing shareholder value, the spin-off of electrical distribution systems remains on track, and we look forward to sharing more information on our progress at the upcoming investor day in November.

Moving to our results, our second quarter of Revenue, growth of 2%, reflects strength, across multiple areas of our business, and the benefit of stronger than expected vehicle production in the North American Market.

Operating income total 628 million will f****** flow through on volume growth and strong operating performance more than offsetting significant headwinds related to Foreign Exchange and commodity prices. And when combined with the lower share count resulting from our recently, completed accelerated share repurchase program, drove record earnings per share.

Lastly.

We generated $510 million of operating cash flow, further strengthening our balance sheet and providing us with capital allocation flexibility.

Baron will discuss each of these elements in more detail later.

Kevin Clark: Moving to slide four to review our second-quarter new business bookings, our portfolio of advanced technologies and industry-leading supply chain capabilities led to $5.4 billion of new business awards, positioning us for another year of strong bookings. We will get into more detail on each of our segments shortly, but a few of the highlights include Advanced Safety and User Experience business awards totaled $1.8 billion, driven by Active Safety bookings of $1.2 billion. Customer awards in our Engineered Components group reached $2.4 billion, ranging across our full portfolio of interconnect solutions, high-speed cable assemblies, bus bars, and cable management products across a broad range of customers and end markets.

Moving to slide 4 to review. Our second quarter, new business. Bookings.

Our portfolio of advanced technologies and industry-leading supply chain capabilities led to $5.4 billion of new business awards.

Kevin Clark: We'll get into more detail on each of our segments shortly, but a few of the highlights include Advanced Safety and User Experience business awards totaled $1.8 billion, driven by Active Safety bookings of $1.2 billion. Customer awards in our Engineered Components Group reached $2.4 billion, ranging across our full portfolio of interconnect, high-speed cable assemblies, bus bars, and cable management products across a broad range of customers and end markets. And new business bookings in Electrical Distribution Systems totaled $1.2 billion and included both low-voltage and high-voltage customer awards across each of our geographic regions. Let's move to the key developments in each of our business segments during the second quarter. Moving to slide five for an update on our Advanced Safety and User Experience segment, where revenues declined low single digits in the quarter.

Positioning us for another year of strong bookings.

We'll get into more detail on each of our segments shortly, but a few of the highlights include advanced Safety and user experience Business Awards, total 1.8 billion.

Driven by active safety. Bookings a 1.2 billion.

Customer awards in our engineered components group reached $2.4 billion.

Kevin Clark: New business bookings in Electrical Distribution Systems totaled $1.2 billion and included both low-voltage and high-voltage customer awards across each of our geographic regions. Let us move to the key developments in each of our business segments during the second quarter. Moving to slide five for an update on our Advanced Safety and User Experience segment, where revenues declined low single digits in the quarter, the result of mid-single-digit revenue growth in Active Safety and Wind River, offset by the ongoing rolloff of legacy User Experience programs we have referenced previously, and a recent slowdown in production schedules on select Zeekr and NIO programs in China. We expect these to remain headwinds for the next few quarters. Looking ahead, we executed multiple strategic program launches across each of our product lines.

Ranging across our full portfolio of interconnect high-speed cable assemblies bus bars and cable management products across a broad range of customers and and markets.

And new business, bookings, and electrical distribution systems, total of 1.2 billion.

And included both low-voltage and high-voltage customer awards across each of our geographic regions.

Let's move to the key developments in each of our business segments. During the second quarter.

Kevin Clark: The result of mid-single digit revenue growth in Active Safety and Wind River is offset by the ongoing roll-off of legacy User Experience programs we've referenced previously and a recent slowdown in production schedules on select Zeekr and NIO programs in China. We expect these to remain headwinds for the next few quarters. Looking ahead, we executed multiple strategic program launches across each of our product lines. The highlights include an ADAS system spanning multiple brands for a leading European OEM, enhancing the performance of their current ADAS solution and enabling them to meet the latest regulatory requirements, an in-cabin sensing solution across multiple brands with a leading European OEM, our first in-cabin sensing program with this customer, opening the door to other opportunities, and a User Experience solution for one of the flagship platforms of a luxury European OEM.

The result of mid-single digit revenue growth in Active Safety and Wind River is offset by the ongoing roll-off of legacy User Experience programs we've referenced previously and a recent slowdown in production schedules on select Zeekr and NIO programs in China. We expect these to remain headwinds for the next few quarters. Looking ahead, we executed multiple strategic program launches across each of our product lines. The highlights include an ADAS system spanning multiple brands for a leading European OEM, enhancing the performance of their current ADAS solution and enabling them to meet the latest regulatory requirements, an in-cabin sensing solution across multiple brands with a leading European OEM, our first in-cabin sensing program with this customer, opening the door to other opportunities, and a User Experience solution for one of the flagship platforms of a luxury European OEM.

Moving to slide 5 for an update on our, on our advanced Safety and user experience segment. Where revenues declined, low single digits in the quarter?

The result of mid single digit Revenue, growth in active, safety and Wind River.

Offset by the ongoing roll-off of legacy user experience programs, we've referenced previously.

In a recent slowdown in production schedules on select xikar and Neo programs in China.

Kevin Clark: The highlights include an ADAS system spanning multiple brands for a leading European OEM, enhancing the performance of their current ADAS solution and enabling them to meet the latest regulatory requirements, an in-cabin sensing solution across multiple brands with a leading European OEM, our first in-cabin sensing program with this customer, opening the door to other opportunities, and a User Experience solution for one of the flagship platforms of a luxury European OEM. Moving to new business bookings, we continue to see momentum with our flexible and scalable Gen 6 ADAS platform, as evidenced by two major awards.

Looking ahead. We executed multiple strategic program launches across each of our product lines.

The highlights include an 8F system, spending multiple brands for a leading European OEM.

Enhancing the performance of their current 8s solution and enabling them to meet the latest regulatory requirements.

And in Cabin sensing solution across multiple brands with a leading European OEM our first Inc, cabin sensing program with this, customer opening the door to other opportunities.

Kevin Clark: Moving to new business bookings, we continue to see momentum with our flexible and scalable Gen 6 ADAS platform, as evidenced by two major awards. First, a leading North American OEM has selected Aptiv for their next-gen ADAS solution that runs across a range of vehicles, supporting features which scale up to hands-free driving. We're also awarded a full-system ADAS program with Leapmotor, a Chinese EV OEM for the European market, which includes an RTOS from Wind River running on a China local SOC and an AI-powered vision stack from StradVision. These awards demonstrate how our global ADAS expertise, open architected platforms, and global footprint make us a partner of choice for a wide range of OEMs.

Moving to new business bookings, we continue to see momentum with our flexible and scalable Gen 6 ADAS platform, as evidenced by two major awards. First, a leading North American OEM has selected Aptiv for their next-gen ADAS solution that runs across a range of vehicles, supporting features which scale up to hands-free driving. We're also awarded a full-system ADAS program with Leapmotor, a Chinese EV OEM for the European market, which includes an RTOS from Wind River running on a China local SOC and an AI-powered vision stack from StradVision. These awards demonstrate how our global ADAS expertise, open architected platforms, and global footprint make us a partner of choice for a wide range of OEMs.

and a user experience solution, for 1 of the flagship platforms of a luxury European om,

Kevin Clark: First, a leading North American OEM has selected Aptiv PLC for their next-gen ADAS solution that runs across a range of vehicles, supporting features which scale up to hands-free driving. We were also awarded a full system ADAS program with Leap Motor, a Chinese EV OEM for the European market, which includes an RTOS from Wind River running on a China local SOC and an AI-powered vision stack from StradVision. These awards demonstrate how our global ADAS expertise, open-architected platforms, and global footprint make us a partner of choice for a wide range of OEMs. In User Experience, we were awarded a next-generation digital cockpit program for a German luxury OEM, which incorporates Wind River Studio for over-the-air updates and lifecycle management, providing enhanced connectivity, performance, and personalization.

Moving to our new business, bookings. We continue to see momentum with our flexible and scalable Gen 6 8s platform, as evidenced by two major awards. First, a leading North American OEM selected Active for their next-gen 8 app solution that runs across a range of vehicles, supporting features that scale up to hands-free driving.

We're also awarded a full system, 8s program, with leap motor.

A Chinese Evo em for the European market which includes in our toss from, when river running on a China, local SOC. And then AI powered Vision stack from stradvision

Kevin Clark: In user experience, we were awarded a next-generation digital cockpit program for a German luxury OEM, which incorporates Wind River Studio for over-the-air updates and lifecycle management, providing enhanced connectivity, performance, and personalization. Wind River also had a range of strategic customer awards across multiple end markets, which include Wind River Studio for Hyundai Mobis, to power their software development and deployment and lifecycle management for automotive applications, Wind River Cloud Platform for a multinational telecom company, an edge platform solution and safety certification for a leading US aerospace and defense prime, and an edge platform for advanced medical imaging systems with a leading healthcare equipment provider. At the same time, we expanded Wind River's edge AI ecosystem by establishing multiple strategic partnerships with AI players, including ZEDEDA, Nota AI, SiMa.ai, and DeepX, which will help advance the deployment of AI across diverse edge applications and industries.

In user experience, we were awarded a next-generation digital cockpit program for a German luxury OEM, which incorporates Wind River Studio for over-the-air updates and lifecycle management, providing enhanced connectivity, performance, and personalization. Wind River also had a range of strategic customer awards across multiple end markets, which include Wind River Studio for Hyundai Mobis, to power their software development and deployment and lifecycle management for automotive applications, Wind River Cloud Platform for a multinational telecom company, an edge platform solution and safety certification for a leading US aerospace and defense prime, and an edge platform for advanced medical imaging systems with a leading healthcare equipment provider. At the same time, we expanded Wind River's edge AI ecosystem by establishing multiple strategic partnerships with AI players, including ZEDEDA, Nota AI, SiMa.ai, and DeepX, which will help advance the deployment of AI across diverse edge applications and industries.

These Awards demonstrate how our Global 8 as expertise open architected platforms and Global footprint. Make us a partner of choice for a wide range of oems.

And user experience.

Kevin Clark: Wind River also had a range of strategic customer awards across multiple end markets, which include Wind River Studio for Hyundai Mobus, to power their software development and deployment and lifecycle management for automotive applications, Wind River Cloud Platform for a multinational telecom company, an edge platform solution and safety certification for a leading U.S. aerospace and defense prime, and an edge platform for advanced medical imaging systems with a leading healthcare equipment provider. At the same time, we expanded Wind River's Edge AI ecosystem by establishing multiple strategic partnerships with AI players, including Zadata, Nota AI, Cima.AI, and DeepX, which will help advance the deployment of AI across diverse edge applications and industries. Moving to slide six to review the highlights for our Engineered Components group, which delivered solid mid-single-digit revenue growth in the quarter. We launched several strategic programs and secured strong new business awards across our portfolio.

We are awarded the Next Generation digital cockpit program for a German luxury OEM which incorporates Wind River Studio for over-the-air updates and the life cycle management, providing enhanced connectivity performance and personalization.

When River also had a range of strategic customer Awards across multiple and markets which include Wind River Studio for Hyundai mous.

To power their software development and deployment and life cycle management for automotive applications.

Wind River Cloud platform for a multinational Telecom company.

And Edge, platform solution, and safety certification for a leading us Aerospace and defense Prime.

and an edge platform for Advanced Medical Imaging systems with a leading Healthcare equipment, provider,

At the same time, we expanded wind River's Edge, AI ecosystem by establishing multiple strategic Partnerships with AI players.

Including the data.

Nota Ai semai and DX.

Which will help advance the deployment of AI across diverse edge applications and industries.

Kevin Clark: Moving to slide 6 to review the highlights for our Engineered Components Group, which delivered solid mid-single-digit revenue growth in the quarter. We launched several strategic programs and secured strong new business awards across our portfolio. Notable program launches include a high-voltage charging inlet on a luxury European OEM platform, enabling expanded charging access across multiple regions, low-voltage ECU connectors for a leading Chinese OEM's commercial vehicle program, and an up-integrated high-voltage electrical center for a large Korean OEM for next-generation electrical and electronic architectures. Moving to new business bookings, these awards underscore our role in advanced signal, power, and data distribution. During the quarter, we received high-speed cable assembly awards to enable next-generation features, including Level 2++ hands-free driving for local Chinese OEMs such as BYD, Geely, and Changan.

Moving to slide 6 to review the highlights for our Engineered Components Group, which delivered solid mid-single-digit revenue growth in the quarter. We launched several strategic programs and secured strong new business awards across our portfolio. Notable program launches include a high-voltage charging inlet on a luxury European OEM platform, enabling expanded charging access across multiple regions, low-voltage ECU connectors for a leading Chinese OEM's commercial vehicle program, and an up-integrated high-voltage electrical center for a large Korean OEM for next-generation electrical and electronic architectures. Moving to new business bookings, these awards underscore our role in advanced signal, power, and data distribution. During the quarter, we received high-speed cable assembly awards to enable next-generation features, including Level 2++ hands-free driving for local Chinese OEMs such as BYD, Geely, and Changan.

Moving to slide 6 to review the highlights for the Engineered Components Group, which delivered solid midsingle-digit revenue growth in the quarter.

Kevin Clark: Notable program launches include a high-voltage charging inlet on a luxury European OEM platform, enabling expanded charging access across multiple regions, low-voltage ECU connectors for a leading Chinese OEM's commercial vehicle program, and an up-integrated high-voltage electrical center for a large Korean OEM for next-generation electrical and electronic architectures. Moving to new business bookings, these awards underscore our role in advanced signal, power, and data distribution. During the quarter, we received high-speed cable assembly awards to enable next-generation features, including L2++ hands-free driving for local Chinese OEMs such as BYD, Geely, and Changmen. Intercable Automotive's first bus bar award for a new autonomous vehicle program with a leading U.S.-based EV manufacturer, a high-voltage inlet award for a luxury European OEM, and an award for our rapid power reserve, providing highly reliable redundant power for a variety of critical functions for Sirius with Huawei systems.

We launched several strategic programs and secured strong new business Awards across our portfolio.

Notable program launches include a high voltage charging Inlet on a luxury. You European OEM platform enabling expanded charging access across multiple regions.

Low voltage. ECU connectors for a leading Chinese, oems commercial vehicle program.

And an up integrated high voltage, electrical Center for a large Korean OEM for Next Generation, electrical and electronic architectures.

Moving to new business, bookings.

These awards underscore our role in advanced signal power and data distribution.

During the quarter, we received high-speed cable. Assembly Awards to enable Next Generation features, including L2 plus plus hands-free driving for local Chinese oems. Such as byd.

Kevin Clark: Intercable Automotive's first bus bar award for a new autonomous vehicle program with a leading US-based EV manufacturer, a high-voltage inlet award for a luxury European OEM, and an award for our Rapid Power Reserve, providing highly reliable redundant power for a variety of critical functions for Sirius with Huawei systems. Notable awards outside of the automotive sector include an award in aerospace and defense with a leading manufacturer and operator of small satellites for use in low-Earth orbit, and bookings for mission-critical applications from a leading US defense company. Moving to slide seven to review the Q2 highlights for our electrical distribution system segment, which delivered solid mid-single digit revenue growth. Beginning with new program launches, we gained incremental high-voltage content on a recent launch of a refreshed vehicle platform from a US-based global EV manufacturer.

Intercable Automotive's first bus bar award for a new autonomous vehicle program with a leading US-based EV manufacturer, a high-voltage inlet award for a luxury European OEM, and an award for our Rapid Power Reserve, providing highly reliable redundant power for a variety of critical functions for Sirius with Huawei systems. Notable awards outside of the automotive sector include an award in aerospace and defense with a leading manufacturer and operator of small satellites for use in low-Earth orbit, and bookings for mission-critical applications from a leading US defense company. Moving to slide seven to review the Q2 highlights for our electrical distribution system segment, which delivered solid mid-single digit revenue growth. Beginning with new program launches, we gained incremental high-voltage content on a recent launch of a refreshed vehicle platform from a US-based global EV manufacturer.

GLE and China.

Inner cable. Automotives, first bus bar award for a new autonomous vehicle program with a leading us-based. EV manufacturer

A high voltage inlet award for a luxury European OEM.

And an award for our rapid power Reserve. Providing highly reliable redundant power for a variety of critical functions for serious with Huawei systems.

Kevin Clark: Notable awards outside of the automotive sector include an award in aerospace and defense with a leading manufacturer and operator of small satellites for use in low-Earth orbit and bookings for mission-critical applications from a leading U.S. defense company. Moving to slide seven to review the Q2 highlights for our Electrical Distribution Systems segment, which delivered solid mid-single-digit revenue growth. Beginning with new program launches, we gained incremental high-voltage content on a recent launch of a refreshed vehicle platform from a U.S.-based global EV manufacturer. We also launched a high-voltage battery wiring program for a leading Korean OEM that will be used across multiple electric vehicle programs for the Asia-Pacific market. Moving to new business awards, we continued to book programs in both high and low-voltage architectures.

Notable award outside of the automotive sector, including awarding Aerospace and defense with a leading manufacturer and operator of small satellites for use in lower Earth orbit.

And bookings for Mission critical applications from a leading us defense company.

Moving to slide 7 to review the second quarter highlights for our electrical distribution system segments, which delivered solid mid-single-digit revenue growth.

Beginning with new program launches, we gained incremental high-voltage content on a recent launch of a refreshed vehicle platform.

Kevin Clark: We also launched a high-voltage battery wiring program for a leading Korean OEM that will be used across multiple electric vehicle programs for the Asia-Pacific market. Moving to new business awards, we continue to book programs in both high- and low-voltage architectures. We increased our share of wallet on current vehicle programs with local Chinese OEMs, including Leapmotor's new flagship SUV and a new extended-range electric SUV from IM Motors, SAIC's EV brand. In India, we were awarded low-voltage harnesses for a next-gen platform with Tata, and a significant low-voltage harness award on a top-10 European battery electric vehicle platform with a luxury European OEM. Turning to slide eight, I'd like to provide some context on our outlook before Varun takes you through our update in more detail. As intended, we're providing Q3 and updating our full year 2025 financial guidance.

We also launched a high-voltage battery wiring program for a leading Korean OEM that will be used across multiple electric vehicle programs for the Asia-Pacific market. Moving to new business awards, we continue to book programs in both high- and low-voltage architectures. We increased our share of wallet on current vehicle programs with local Chinese OEMs, including Leapmotor's new flagship SUV and a new extended-range electric SUV from IM Motors, SAIC's EV brand. In India, we were awarded low-voltage harnesses for a next-gen platform with Tata, and a significant low-voltage harness award on a top-10 European battery electric vehicle platform with a luxury European OEM. Turning to slide eight, I'd like to provide some context on our outlook before Varun takes you through our update in more detail. As intended, we're providing Q3 and updating our full year 2025 financial guidance.

From a us-based global EV manufacturer.

Specific Market.

Kevin Clark: We increased our share of wallet on current vehicle programs with local Chinese OEMs, including Leap Motor's new flagship SUV and a new extended-range electric SUV from IM Motors, SAIC's EV brand. In India, we awarded low-voltage harnesses for a next-gen platform with Tata and a significant low-voltage harness award on a top 10 European battery electric vehicle platform with a luxury European OEM. Turning to slide eight, I'd like to provide context on our outlook before Varun Laroyia takes you through our update in more detail. As intended, we're providing Q3 and updating our full-year 2025 financial guidance. Our first half results benefited from stronger than forecasted vehicle production, likely reflecting some pull forward of demand. We capitalized on this market backdrop with strong manufacturing, engineering, and supply chain performance across each of our segments.

Moving to New Business Awards, we continue to book programs in both high and low voltage, architectures.

We increased our share of wallet on current vehicle programs with local Chinese oems including leak. Motors new flagship SUV.

And a new extended range electric SUV from IM Motors, seed EV brand.

In India, we awarded low voltage harnesses for next gen platform with Tata.

and a significant low voltage award on the top 10 European battery electric vehicle platform with a luxury European OEM

during this slide 8.

I'd like to provide some context on our outlook for verint. Takes you through our update in more detail.

Kevin Clark: Our first half results benefited from stronger-than-forecasted vehicle production, likely reflecting some pull forward of demand. We capitalized on this market backdrop with strong manufacturing, engineering, and supply chain performance across each of our segments. Looking at the second half of the year, we remain in a period of uncertainty driven by evolving trade and regulatory policies and remain cautious that consumer demand could weaken in the back half of the year, which we've reflected in our updated guidance. Our team remains relentlessly focused on navigating the dynamic environment, serving our customers, and delivering strong financial results that enhance shareholder value. I'll now turn the call over to Varun to go through our second quarter results and third quarter and full year 2025 guidance in more detail. Thanks, Kevin, and good morning, everyone.

Our first half results benefited from stronger-than-forecasted vehicle production, likely reflecting some pull forward of demand. We capitalized on this market backdrop with strong manufacturing, engineering, and supply chain performance across each of our segments. Looking at the second half of the year, we remain in a period of uncertainty driven by evolving trade and regulatory policies and remain cautious that consumer demand could weaken in the back half of the year, which we've reflected in our updated guidance. Our team remains relentlessly focused on navigating the dynamic environment, serving our customers, and delivering strong financial results that enhance shareholder value. I'll now turn the call over to Varun to go through our second quarter results and third quarter and full year 2025 guidance in more detail.

As intended, we're providing third quarter and updating our full year, 2025 Financial guidance.

Our first half results benefited from stronger than forecasted vehicle production, likely reflecting some pull forward of demand.

Kevin Clark: Looking at the second half of the year, we remain in a period of uncertainty driven by evolving trade and regulatory policies and remain cautious that consumer demand could weaken in the back half of the year, which we've reflected in our updated guidance. Our team remains relentlessly focused on navigating the dynamic environment, serving our customers, and delivering strong financial results that enhance shareholder value. I will now turn the call over to Varun Laroyia to go through our Q2 results and Q3 and full-year 2025 guidance in more detail.

And we capitalize on this Market, backdrop, with strong, manufacturing, engineering, and supply chain performance across each of our segments.

Looking at the second half of the year.

We remain in a period of uncertainty driven by evolving trade and regulatory policies, and we remain cautious that consumer demand could weaken in the back half of the year.

Which we reflected in our updated guidance.

Our team remains relentlessly focused on navigating the dynamic environment, serving our customers and delivering strong financial results that enhance your holder value.

Varun Laroyia: Thanks, Kevin, and good morning, everyone. Starting with our second quarter financials on slide nine, Aptiv delivered record financial results reflecting strong execution, continued progress on our operational efficiency programs, and the benefit of our ASR completed in the quarter. Revenues were a record $5.2 billion, up 2% on an adjusted basis. I'll talk more about our revenue performance on the next slide. Adjusted EBITDA and operating income both grew 4%, marking record levels on an absolute basis. Operating income margin expanded 10 basis points, primarily driven by the strong performance on our operating and cost structure initiatives, including our continued footprint rotation to best cost locations. These efforts were offset by the impact of FX and commodities, which were a 120-basis-point headwind on margin, largely driven by the Mexican peso, where we lacked a natural operating hedge.

Varun Laroyia: Thanks, Kevin, and good morning, everyone. Starting with our Q2 financials on slide nine, Aptiv PLC delivered record financial results reflecting strong execution, continued progress on our operational efficiency programs, and the benefit of our ASR completed in the quarter. Revenues were a record $5.2 billion, up 2% on an adjusted basis. I will talk more about our revenue performance on the next slide. Adjusted EBITDA and operating income both grew 4%, marking record levels on an absolute basis. Operating income margin expanded 10 basis points, primarily driven by the strong performance on our operating and cost structure initiatives, including our continued footprint rotation to best cost locations. These efforts were offset by the impact of FX and commodities, which were a 120 basis point headwind on margin, largely driven by the Mexican peso, where we lacked a natural operating hedge.

And now turn the call over to Varon to go through our second quarter results, and third quarter and full year 2025 guidance in more detail.

Kevin Clark: Starting with our second quarter financials on slide nine, Aptiv delivered record financial results reflecting strong execution, continued progress on our operational efficiency programs, and the benefit of our ASR completed in the quarter. Revenues were a record $5.2 billion, up 2% on an adjusted basis. I'll talk more about our revenue performance on the next slide. Adjusted EBITDA and operating income both grew 4%, marking record levels on an absolute basis. Operating income margin expanded 10 basis points, primarily driven by the strong performance on our operating and cost structure initiatives, including our continued footprint rotation to best cost locations. These efforts were offset by the impact of FX and commodities, which were a 120-basis-point headwind on margin, largely driven by the Mexican peso, where we lacked a natural operating hedge.

Thanks, Kevin and good morning everyone. Starting with our second quarter financials on slide 9.

Active delivered record Financial results. Reflecting strong execution, continued progress, on our operational efficiency programs and the benefit of our ASR completed in the quarter,

revenues were a record. 5.2 billion up to 2% on an adjusted basis.

I'll talk more about our revenue performance on the next slide.

Adjusted EBITDA and operating income both grew 4%, marking record levels on an absolute basis.

Operating income margin expanded 10 basis points, primarily driven by the strong performance of our operating and cost structure initiatives.

Including our continued footprint rotation to best cost locations.

Varun Laroyia: Earnings per share was $2.12, an increase of 34%, reflecting the flow-through of higher operating income, benefits of share repurchases, net of higher interest expense, the restructuring of the Motional Joint Venture, and lower tax expense in the quarter, driven by the timing of certain discrete items. Operating cash flow was $510 million, and capital expenditures were $149 million. Turning to the next slide and looking more closely at Q2 adjusted revenue growth on a regional basis. In North America, despite vehicle production being down year on year in the region, revenue grew 3%, driven by growth in both Active Safety and electrified programs. In Europe, revenue was down 1%, slightly better than vehicle production in the region, driven by growth in commercial vehicles. In China, revenue declined 1%, which reflects the unfavorable impact of customer mix in the AS/UX segment.

Kevin Clark: Earnings per share was $2.12, an increase of 34%, reflecting the flow-through of higher operating income, benefits of share repurchases, net of higher interest expense, the restructuring of the motional joint venture, and lower tax expense in the quarter driven by the timing of certain discrete items. Operating cash flow was $510 million, and capital expenditures were $149 million. Turning to the next slide and looking more closely at second quarter adjusted revenue growth on a regional basis. In North America, despite vehicle production being down year-on-year in the region, revenue grew 3%, driven by growth in both active safety and electrified programs. In Europe, revenue was down 1%, slightly better than vehicle production in the region, driven by growth in commercial vehicles. In China, revenue declined 1%, which reflects the unfavorable impact of customer mix in the ASUX segment.

Earnings per share was $2.12, an increase of 34%, reflecting the flow-through of higher operating income, benefits of share repurchases, net of higher interest expense, the restructuring of the motional joint venture, and lower tax expense in the quarter driven by the timing of certain discrete items. Operating cash flow was $510 million, and capital expenditures were $149 million. Turning to the next slide and looking more closely at second quarter adjusted revenue growth on a regional basis. In North America, despite vehicle production being down year-on-year in the region, revenue grew 3%, driven by growth in both active safety and electrified programs. In Europe, revenue was down 1%, slightly better than vehicle production in the region, driven by growth in commercial vehicles. In China, revenue declined 1%, which reflects the unfavorable impact of customer mix in the ASUX segment.

These efforts were offset by the impact of FX and commodities which were a 120 basis point headwind on margin. Largely driven by the Mexican peso where we lack in natural operating heads.

Earnings per share was $2.12, an increase of 34%, reflecting the flow-through of higher operating income.

Benefits of share repurchases. Net of higher, interest expense.

The restructuring of the Motional joint venture and lower tax expense in the quarter were driven by the timing of certain discrete items.

Operating cash flow was 510 million and capital expenditures were 149 million.

Turning to the next slide and looking more closely at second quarter adjusted revenue growth on a regional basis.

In North America, despite vehicle production being down year on year in the region. Revenue grew 3%, driven by growth in both active safety and electrified programs.

In Europe, Revenue was down. 1% slightly better than vehicle production in the region, driven by growth in commercial vehicles.

Kevin Clark: Moving to our segment performance in slide 11, and again, I'll refer to revenue growth on an adjusted basis. Starting with ASUX, revenue of approximately $1.5 billion was down 3%, primarily driven by the two factors Kevin mentioned previously. Partially offsetting these was a 6% growth in active safety revenue, driven by strong volumes and take rates across major customers in North America and Europe. ASUX adjusted operating income grew 5%, with 90 basis points of margin expansion. A 150 basis point headwind from FX and commodities was more than offset by our ongoing performance, cost savings initiatives, and the lapping of a customer receivable issue in Q2 of last year that was resolved in Q3. The associated settlement from a year ago will present a temporary headwind to margin next quarter.

Moving to our segment performance in slide 11, and again, I'll refer to revenue growth on an adjusted basis. Starting with ASUX, revenue of approximately $1.5 billion was down 3%, primarily driven by the two factors Kevin mentioned previously. Partially offsetting these was a 6% growth in active safety revenue, driven by strong volumes and take rates across major customers in North America and Europe. ASUX adjusted operating income grew 5%, with 90 basis points of margin expansion. A 150 basis point headwind from FX and commodities was more than offset by our ongoing performance, cost savings initiatives, and the lapping of a customer receivable issue in Q2 of last year that was resolved in Q3. The associated settlement from a year ago will present a temporary headwind to margin next quarter.

Varun Laroyia: Moving to our segment performance in slide 11, I will refer to revenue growth on an adjusted basis. Starting with AS/UX, revenue of approximately $1.5 billion was down 3%, primarily driven by the two factors Kevin mentioned previously. Partially offsetting these was a 6% growth in Active Safety revenue, driven by strong volumes and take rates across major customers in North America and Europe. AS/UX adjusted operating income grew 5% with 90 basis points of margin expansion. A 150 basis point headwind from FX and commodities was more than offset by our ongoing performance and cost savings initiatives and the lapping of a customer receivable issue in the second quarter of last year that was resolved in the third quarter. The associated settlement from a year ago will present a temporary headwind to margin next quarter.

And in China Revenue declined, 1%, which reflects the unfavorable impact of customer mix in the as ux segment.

Moving to our segment performance and slide 11. And again, I'll refer to revenue growth on an adjusted basis.

Starting with ESU X.

Revenue for approximately $1.5 billion was down 3%, primarily driven by the two factors Kevin mentioned previously.

partially offsetting these

There was a 6% growth in active safety revenue, driven by strong volumes and take rates across major customers in North America and Europe.

As ux adjusted operating income, grew 5% with 90 basis points of margin expansion.

And the lapping of a customer receivable issue. In the second quarter of last year, that was resolved in the third quarter.

Kevin Clark: For ECG, revenue of $1.7 billion increased 5% and was driven by growth in Europe, and continued traction with local China OEMs, which grew by more than 30%. ECG adjusted operating income declined 4%, while margin contracted by 160 basis points. As flow-through from stronger volumes was more than offset by the impact of unfavorable FX, commodities, and labor inflation. And lastly, for our EDS business, revenue of $2.2 billion increased 5%. This was driven by strong volume growth in North America, and Asia-Pacific, while commercial vehicle revenue grew by 17%. EDS adjusted operating income grew by 18%, with 70 basis points of margin expansion owing to strong flow-through on volume growth, and execution on footprint optimization, which more than offset a 90 basis point margin headwind related to FX. Now let's review our balance sheet on the next slide.

For ECG, revenue of $1.7 billion increased 5% and was driven by growth in Europe, and continued traction with local China OEMs, which grew by more than 30%. ECG adjusted operating income declined 4%, while margin contracted by 160 basis points. As flow-through from stronger volumes was more than offset by the impact of unfavorable FX, commodities, and labor inflation. And lastly, for our EDS business, revenue of $2.2 billion increased 5%. This was driven by strong volume growth in North America, and Asia-Pacific, while commercial vehicle revenue grew by 17%. EDS adjusted operating income grew by 18%, with 70 basis points of margin expansion owing to strong flow-through on volume growth, and execution on footprint optimization, which more than offset a 90 basis point margin headwind related to FX. Now let's review our balance sheet on the next slide.

Varun Laroyia: For Engineered Components, revenue of $1.7 billion increased 5% and was driven by growth in Europe and continued traction with local China OEMs, which grew by more than 30%. Engineered Components adjusted operating income declined 4%, while margin contracted by 160 basis points as flow-through from stronger volumes was more than offset by the impact of unfavorable FX, commodities, and labor inflation. Lastly, for our Electrical Distribution Systems business, revenue of $2.2 billion increased 5%. This was driven by strong volume growth in North America and Asia-Pacific, while commercial vehicle revenue grew by 17%. Electrical Distribution Systems adjusted operating income grew by 18% with 70 basis points of margin expansion, going to strong flow-through on volume growth and execution on footprint optimization, which more than offset a 90 basis point margin headwind related to FX. Now let's review our balance sheet on the next slide.

The associated settlement from a year ago will present a temporary headwind to margin next quarter.

For ECG revenue of $1.7 billion, increased 5% and was driven by growth in Europe, and continued traction with local China OEMs, which grew by more than 30%.

ECG adjusted operating income decline. 4%, while margin contracted by 160 basis points has flow through from stronger. Volumes was more than offset by the impact of unfavorable FX Commodities and labor inflation.

And lastly, for our EDS business, revenue of 2.2 billion increased 5%.

This was driven by strong volume growth in North America and Asia-Pacific. While commercial vehicle revenue grew by 17%.

EDS.

Adjusted operating income grew by 18%. With 70 basis, points of margin expansion, going to strong flow through on volume growth and execution on footprint optimization, which more than offset in 90 basis point margin. Headwind related to FX,

Kevin Clark: We generated $510 million of operating cash flow in the second quarter, with the change versus prior year owing to investments in working capital. Our cash flow, as measured on a last 12-month basis, remains very strong, at well in excess of $2 billion. We ended the second quarter with over $1.4 billion of cash and approximately $4 billion in total liquidity. And as I discussed on our Q1 earnings call, we paid down $175 million on our pan-European factoring facility in early April. Year to date, we have paid down approximately $700 million of prepayable debt, well ahead of our original deleveraging schedule. With net leverage at 2x, our balance sheet continues to provide us with flexibility to execute on our strategic initiatives while selectively pursuing growth opportunities. Turning now to our guidance, which we have updated for the full year and have established for the third quarter.

We generated $510 million of operating cash flow in the second quarter, with the change versus prior year owing to investments in working capital. Our cash flow, as measured on a last 12-month basis, remains very strong, at well in excess of $2 billion. We ended the second quarter with over $1.4 billion of cash and approximately $4 billion in total liquidity. And as I discussed on our Q1 earnings call, we paid down $175 million on our pan-European factoring facility in early April. Year to date, we have paid down approximately $700 million of prepayable debt, well ahead of our original deleveraging schedule. With net leverage at 2x, our balance sheet continues to provide us with flexibility to execute on our strategic initiatives while selectively pursuing growth opportunities. Turning now to our guidance, which we have updated for the full year and have established for the third quarter.

Varun Laroyia: We generated $510 million of operating cash flow in the second quarter, with the change versus prior year owing to investments in working capital. Our cash flow, as measured on a last 12 months basis, remains very strong, at well in excess of $2 billion. We ended the second quarter with over $1.4 billion of cash and approximately $4 billion in total liquidity. As I discussed on our Q1 earnings call, we paid down $175 million on our Pan-European factoring facility in early April. Year to date, we have paid down approximately $700 million of prepayable debt, well ahead of our original deleveraging schedule. With net leverage at two times, our balance sheet continues to provide us with flexibility to execute on our strategic initiatives while selectively pursuing growth opportunities. Turning now to our guidance, which we have updated for the full year and have established for the third quarter.

Now, let's review a balance sheet on the next slide.

We generated 510 million of operating cash flow in the second quarter with the change versus prior year owing to investments in working capital.

Our cash flow, as measured on a last 12 months basis, remains very strong at well in excess of $2 billion.

We ended the second quarter with over 1.4 billion of cash and approximately 4 billion dollars in total liquidity.

As I discussed on our Q1 earnings call, we paid down $175 million on our pan-European factoring facility in early April.

Yeah to date. We had paid down approximately 700 million dollars of prepaid debt. Well, ahead of our original deleveraging schedule.

With net leverage at 2 times, our balance sheet continues to provide us with the flexibility to execute on our strategic initiatives while selectively pursuing growth opportunities.

Varun Laroyia: Starting with revenue growth expectations on slide 13, we continue to forecast Aptiv PLC weighted global vehicle production to be down 3% for the full year 2025, equating to approximately 92.5 million units. Relative to our original 2025 outlook, this reflects stronger volumes in China, offset by slightly weaker volumes in North America. Based on our vehicle production assumptions, we expect adjusted revenue growth at the midpoint of our guidance to be up 4% in North America, driven by content growth with key customers, as well as growth in commercial vehicles. Down 1% in Europe, slightly better than vehicle production in the region, and down 2% in China, which largely reflects our revenue mix between the local OEMs and multinational JVs.

Kevin Clark: Starting with revenue growth expectations on slide 13, we continue to forecast active-weighted global vehicle production to be down 3% for the full year 2025, equating to approximately 92.5 million units. Relative to our original 2025 outlook, this reflects stronger volumes in China offset by slightly weaker volumes in North America. Based on our vehicle production assumptions, we expect adjusted revenue growth at the midpoint of our guidance to be up 4% in North America, driven by content growth with key customers, as well as growth in commercial vehicles. Down 1% in Europe, slightly better than vehicle production in the region, and down 2% in China, which largely reflects our revenue mix between the local OEMs and multinational JVs.

Starting with revenue growth expectations on slide 13, we continue to forecast active-weighted global vehicle production to be down 3% for the full year 2025, equating to approximately 92.5 million units. Relative to our original 2025 outlook, this reflects stronger volumes in China offset by slightly weaker volumes in North America. Based on our vehicle production assumptions, we expect adjusted revenue growth at the midpoint of our guidance to be up 4% in North America, driven by content growth with key customers, as well as growth in commercial vehicles. Down 1% in Europe, slightly better than vehicle production in the region, and down 2% in China, which largely reflects our revenue mix between the local OEMs and multinational JVs.

Turning now to our guidance, which we have updated for the full year and have established for the third quarter.

Starting with Revenue growth, expectations on slide 13.

we continue to forecast active weighted Global vehicle production to be done 3%, for the full year 2025

Equating to approximately 92.5 million units.

Relative to our original 2025 Outlook, this reflects stronger volumes in China, offset by slightly weaker volumes in North America.

Based on our vehicle production assumptions, we expected just a revenue growth at the midpoint of guidance to be up 4% in North America, driven by content growth with key customers as well as growth in commercial vehicles.

Kevin Clark: For the third quarter specifically, we forecast active-weighted global vehicle production to be down 2% and adjusted revenue growth in North America to be up 9%, with strength across all end markets and partially reflective of an easier comparison from a year ago. Europe down 1%, driven largely by lower production in the region, and China down 4%, driven by customer mix across all segments. Moving on to other components of our guidance. Our full year revenue outlook of $20.15 billion at the midpoint continues to reflect a 2% adjusted growth rate, with higher midpoint a function of favorable FX. We expect low single-digit adjusted growth at each of our three segments. Adjusted EBITDA and operating income are expected to be approximately $3.19 billion and $2.42 billion at the midpoint, up 3% and 2% respectively, and unchanged from prior guidance.

For the third quarter specifically, we forecast active-weighted global vehicle production to be down 2% and adjusted revenue growth in North America to be up 9%, with strength across all end markets and partially reflective of an easier comparison from a year ago. Europe down 1%, driven largely by lower production in the region, and China down 4%, driven by customer mix across all segments. Moving on to other components of our guidance. Our full year revenue outlook of $20.15 billion at the midpoint continues to reflect a 2% adjusted growth rate, with higher midpoint a function of favorable FX. We expect low single-digit adjusted growth at each of our three segments. Adjusted EBITDA and operating income are expected to be approximately $3.19 billion and $2.42 billion at the midpoint, up 3% and 2% respectively, and unchanged from prior guidance.

Varun Laroyia: For the third quarter specifically, we forecast Aptiv weighted global vehicle production to be down 2% and adjusted revenue growth in North America to be up 9%, with strength across all end markets and partially reflective of an easier comparison from a year ago. Europe down 1%, driven largely by low production in the region, and China down 4%, driven by customer mix across all segments. Moving on to other components of our guidance, our full-year revenue outlook of $20.15 billion at the midpoint continues to reflect a 2% adjusted growth rate, with higher midpoint a function of favorable FX. We expect low single-digit adjusted growth at each of our three segments. Adjusted EBITDA and operating income are expected to be approximately $3.19 billion and $2.42 billion at the midpoint, up 3% and 2% respectively, and unchanged from prior guidance.

Down 1% in Europe, slightly better than vehicle production in the region, and down 2% in China, which largely reflects our revenue mix between the local OEMs and multinational JVs.

For the third quarter. Specifically we forecast active weighted, Global vehicle production to be done 2% and adjusted Revenue growth in North America to be up 9% with strength, across all end markets and partially reflective of an easier comparison from a year ago,

Europe down 1%, driven largely by lower production in the region, and China down 4%, driven by customer mix across all segments.

Moving on to other components of our guidance.

Our fully a revenue Outlook of 20.15 billion. Had the midpoint continues to reflect a 2% adjusted growth rate with higher, midpoint a function of favorable FX

We expect low single digit adjusted growth at each of our 3 segments.

Adjusted EBITDA and operating income are expected to be approximately $3.19 billion and $2.42 billion at the midpoint.

3% and 2% respectively.

Varun Laroyia: While FX is a benefit to our top line, primarily owing to the euro, conversely, it is a headwind to our bottom line due to peso-related costs. Higher commodity prices are also a headwind, and these are being offset by stronger performance. Adjusted earnings per share is estimated to be in the range of $7.30 and $7.60, up 19% at the midpoint. This is $0.15 higher than our prior range, reflecting a lower share count following the completion of our ASR program and favorable net interest expense as we have deleveraged ahead of schedule. Lastly, we expect operating cash flow of $2 billion, $100 million lower than our prior guidance, owing to accelerating actions associated with the Electrical Distribution Systems separation that were originally slated for early 2026 into 2025. On capital expenditures, we expect these to be approximately 4% of revenue.

Kevin Clark: While FX is a benefit to our top line, primarily owing to the euro, conversely, it is a headwind to our bottom line due to peso-related costs. Higher commodity prices are also a headwind, and these are being offset by stronger performance. Adjusted earnings per share is estimated to be in the range of $7.30 to $7.60, up 19% at the midpoint. This is $0.15 higher than our prior range, reflecting a lower share count following the completion of our ASR program and favorable net interest expense as we have deleveraged ahead of schedule. Lastly, we expect operating cash flow of $2 billion, $100 million lower than our prior guidance, owing to accelerating actions associated with the EDS separation that were originally slated for early 2026 into 2025. On capital expenditures, we expect these to be approximately 4% of revenue.

While FX is a benefit to our top line, primarily owing to the euro, conversely, it is a headwind to our bottom line due to peso-related costs. Higher commodity prices are also a headwind, and these are being offset by stronger performance. Adjusted earnings per share is estimated to be in the range of $7.30 to $7.60, up 19% at the midpoint. This is $0.15 higher than our prior range, reflecting a lower share count following the completion of our ASR program and favorable net interest expense as we have deleveraged ahead of schedule. Lastly, we expect operating cash flow of $2 billion, $100 million lower than our prior guidance, owing to accelerating actions associated with the EDS separation that were originally slated for early 2026 into 2025. On capital expenditures, we expect these to be approximately 4% of revenue.

And unchanged from prior guidance.

While FX is a benefit to our Top Line, primarily owing to the euro conversely. It is a headwind to our bottom line due to Pacer related costs.

By a commodity, prices are also a headwind, and these are being offset by stronger performance.

Adjusted earnings per share is estimated to be in the range of $7.30 to $7.60, up 19% at the midpoint.

Sets higher than a prior range, reflecting a lower share count following the completion of our ESR program and favorable net interest expense. As we have deliberate ahead of schedule,

Sleep. We expect operating cash flow of 2 billion 100 million lower than our prior guidance. Owing to accelerating actions associated with the Eds separation that were originally slated for early 2026 into 2025.

Kevin Clark: For the third quarter, we expect revenue growth of 3% on an adjusted basis at the midpoint, with operating income margin of 11.6% at the midpoint, and adjusted EPS to be in the range of $1.60 to $1.80. While our full year tax rate remains unchanged at 17.5%, owing to the timing of discrete items, the tax rate in the second half of the year will be higher than the first half. Looking more broadly at the full year, we remain cautious that markets could weaken in the second half, and our guidance reflects this. Combined with revised FX and commodities assumptions, this bridges the delta in our second half expectations relative to our original guidance provided in February, which we believe is prudent given the ongoing macroeconomic uncertainty.

For the third quarter, we expect revenue growth of 3% on an adjusted basis at the midpoint, with operating income margin of 11.6% at the midpoint, and adjusted EPS to be in the range of $1.60 to $1.80. While our full year tax rate remains unchanged at 17.5%, owing to the timing of discrete items, the tax rate in the second half of the year will be higher than the first half. Looking more broadly at the full year, we remain cautious that markets could weaken in the second half, and our guidance reflects this. Combined with revised FX and commodities assumptions, this bridges the delta in our second half expectations relative to our original guidance provided in February, which we believe is prudent given the ongoing macroeconomic uncertainty.

Varun Laroyia: For the third quarter, we expect revenue growth of 3% on an adjusted basis at the midpoint, with operating income margin of 11.6% at the midpoint, and adjusted EPS to be in the range of $1.60 and $1.80. While our full-year tax rate remains unchanged at 17.5%, owing to the timing of discrete items, the tax rate in the second half of the year will be higher than the first half. Looking more broadly at the full year, we remain cautious that markets could weaken in the second half, and our guidance reflects this. Combined with revised FX and commodities assumptions, this bridges the delta in our second half expectations relative to our original guidance provided in February, which we believe is prudent given the ongoing macroeconomic uncertainty.

And on Capital expenditures, we expect these to be approximately 4% of Revenue.

For the third quarter, we expect Revenue growth of 3%, on an adjusted basis at the midpoint, with operating income margin of 11.6% of the midpoint.

An adjusted EPS is expected to be in the range of $1.60 and $1.80.

While a fully tax rate remains unchanged at 17.5%, owing to the timing of discrete items, the tax rate in the second half of the year will be higher than the first half.

Looking more broadly at the full year, we remain cautious that markets could weaken in the second half, and our guidance reflects this.

Varun Laroyia: Our current guidance reflects our exposure to tariffs based on trade policy as it currently stands and does not include the impact of tariffs that have not yet been implemented, including the copper tariffs that were announced overnight. As we have previously discussed, our direct exposure to tariffs is minimal, in large part because of our high compliance with USMCA and our low level of non-USMCA imports into the U.S. In the limited areas where we have exposure and cannot change sourcing, owing to the industry setup, we have been able to pass on the incremental costs. With our resilient business model and relentless focus on optimizing performance, we remain confident in our ability to deliver strong execution regardless of the environment. With that, I would now like to hand the call back to Kevin for his closing remarks.

Kevin Clark: Our current guidance reflects our exposure to tariffs based on trade policy as it currently stands and does not include the impact of tariffs that have not yet been implemented, including the copper tariffs that were announced overnight. As we have previously discussed, our direct exposure to tariffs is minimal, in large part because of our high compliance with USMCA and our low level of non-USMCA imports into the US. In the limited areas where we have exposure and cannot change sourcing owing to the industry setup, we've been able to pass on the incremental costs. With our resilient business model and relentless focus on optimizing performance, we remain confident in our ability to deliver strong execution regardless of the environment. With that, I'd now like to hand the call back to Kevin for his closing remarks. Thanks, Varun. I'll wrap up on slide 15 before we address any questions.

Our current guidance reflects our exposure to tariffs based on trade policy as it currently stands and does not include the impact of tariffs that have not yet been implemented, including the copper tariffs that were announced overnight. As we have previously discussed, our direct exposure to tariffs is minimal, in large part because of our high compliance with USMCA and our low level of non-USMCA imports into the US. In the limited areas where we have exposure and cannot change sourcing owing to the industry setup, we've been able to pass on the incremental costs. With our resilient business model and relentless focus on optimizing performance, we remain confident in our ability to deliver strong execution regardless of the environment. With that, I'd now like to hand the call back to Kevin for his closing remarks.

Combined with revised FX and commodities assumptions, this bridges the delta in our second half expectations relative to our original guidance provided in February. We believe this is prudent given the ongoing macroeconomic uncertainty.

As we have previously discussed, our direct exposure to tariffs is minimal, in large part because of our high compliance with USMCA and our low level of non-USMCA imports into the U.S.

In The Limited areas where we have exposure and cannot change sourcing going to the industry setup. We've been able to pass on the incremental costs.

With our resilient business model and relentless focus on optimizing performance, we remain confident in our ability to deliver strong execution, regardless of the environment.

Kevin Clark: Thanks, Varun. I'll wrap up on slide 15 before we address any questions. We exceeded expectations in the second quarter, delivering record revenue, operating income, and earnings per share. We remain well positioned to continue our strong operating performance through the balance of the year. Our continued strong execution, despite the macro uncertainty, is a function of our resilient business model and our proactive efforts around our product portfolio and cost structure to position Aptiv to perform in all macro backdrops. We continue to see robust demand for our portfolio of industry-leading products across our full sensor-to-cloud technology stack, which is uniquely positioned to benefit from the continued transition towards a more electrified, automated, and digitalized future across multiple end markets.

Kevin Clark: Thanks, Aaron. I will wrap up on slide 15 before we address any questions. We exceeded expectations in Q2, delivering record revenue, operating income, and earnings per share. We remain well-positioned to continue our strong operating performance through the balance of the year. Our continued strong execution, despite the macro uncertainty, is a function of our resilient business model and our proactive efforts around our product portfolio and cost structure to position Aptiv to perform in all macro backdrops. We continue to see robust demand for our portfolio of industry-leading products across our full center to cloud technology stack, which is uniquely positioned to benefit from the continued transition towards a more electrified, automated, and digitalized future across multiple end markets.

With that. I'd now like to hand the call back to Kevin for his closing remarks. Thanks Aaron.

Kevin Clark: We exceeded expectations in the second quarter, delivering record revenue, operating income, and earnings per share. We remain well positioned to continue our strong operating performance through the balance of the year. Our continued strong execution, despite the macro uncertainty, is a function of our resilient business model and our proactive efforts around our product portfolio and cost structure to position Aptiv to perform in all macro backdrops. We continue to see robust demand for our portfolio of industry-leading products across our full sensor-to-cloud technology stack, which is uniquely positioned to benefit from the continued transition towards a more electrified, automated, and digitalized future across multiple end markets. We remain vigilant on positioning Aptiv for long-term success through proactive portfolio management, with the forthcoming separation of EDS being a great example of our commitment to increasing value to our shareholders. Operator, let's now open the line for questions.

I'll wrap up on slide 15 before we address any questions. We exceeded expectations in the second quarter, delivering record Revenue, operating income and earnings per share.

And we remain well positioned to continue our strong operating performance through the balance of the year.

Our continued strong execution, despite macro uncertainty, is a function of our resilient business model and our proactive efforts around a product portfolio and cost structure.

To position active to perform in all macro backgrounds.

We remain vigilant on positioning Aptiv for long-term success through proactive portfolio management, with the forthcoming separation of EDS being a great example of our commitment to increasing value to our shareholders. Operator, let's now open the line for questions.

Kevin Clark: We remain vigilant on positioning Aptiv for long-term success through proactive portfolio management, with the forthcoming separation of EDS being a great example of our commitment to increasing value to our shareholders. Operator, let us now open the line for questions.

We continue to see robust demand for our portfolio of industry-leading products. Across our full sensor to Cloud technology staff, which is uniquely positioned to benefit from the continued transition towards a more electrified automated and digitalized future across multiple end markets and we remain Vigilant on positioning active for long-term. Success Through proactive, portfolio management with a forthcoming. Separation of EDS being a great example of our commitment to increasing value to our shareholders.

Operator, let's now open the line for questions.

Kevin Clark: Thank you. If you would like to ask a question, please signal by pressing Star 1 on your telephone keypad. If you're using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. We request that you limit your questions to one initial with one follow-up so that we may take as many questions as possible. Again, press Star 1 to ask a question. We'll pause for just a moment to allow everyone an opportunity to signal. Our first question comes from Itay Michaeli at TD Cowen. Great. Thank you. Good morning, everyone. Good morning, Itay. Just first question. Good morning. Just first question on the degree of visibility you have at the moment for Q4 production, the guidance that it implies, a healthy decline year over year, but pretty strong outgrowth on your part.

Operator: Thank you. If you would like to ask a question, please signal by pressing Star 1 on your telephone keypad. If you're using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. We request that you limit your questions to one initial with one follow-up so that we may take as many questions as possible. Again, press Star 1 to ask a question. We'll pause for just a moment to allow everyone an opportunity to signal. Our first question comes from Itay Michaeli at TD Cowen.

Jess: Thank you. If you would like to ask a question, please signal by pressing star one on your telephone keypad. If you are using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. We request that you limit your questions to one initial with one follow-up so that we may take as many questions as possible. Again, press star one to ask a question. We will pause for just a moment to allow everyone an opportunity to signal. Our first question comes from Eti Mackelly at TD Cowan.

Thank you. If you would like to ask a,

If you're using a speaker-phone, please make sure you're a mute function, is turned off to allow your signal to reach our equipment.

We request that you limit your questions to one initial with one follow up so that we may take as many questions as possible.

Again press Star one to ask a question.

Well pause for just a moment, everyone an opportunity to signal.

Our first question comes from <unk> Kelly at TD Cowen.

Itay Michaeli: Great. Thank you. Good morning, everyone. Good morning, Itay. Just first question. Good morning. Just first question on the degree of visibility you have at the moment for Q4 production, the guidance that it implies, a healthy decline year over year, but pretty strong outgrowth on your part. I'm just kind of curious how far visibility do you have right now in terms of the schedules themselves?

Joe Spak: Great. Thank you. Good morning, everyone.

Great. Thank you good morning, everyone.

Kevin Clark: Good morning, Jess.

Joe Spak: Just first question. Good morning. First question on the degree of visibility you have at the moment for Q4 production. The guidance, I think, implies a healthy decline year over year, but pretty strong outgrowth on your part. I am just curious how far visibility do you have right now in terms of the schedules themselves?

Just the first question. Good morning. So just first question on the degree of visibility you have at the moment for Q4 production guidance I think implies a healthy decline year over year, but a pretty strong outgrowth in your parts just kind of curious how far visibility do you have right now.

Kevin Clark: I'm just kind of curious how far visibility do you have right now in terms of the schedules themselves? Yeah. As we've talked about previously, we get schedules out through, based on where we sit today, out through the end of the year. Obviously, the closer to where we are today, the stronger the schedules. So I'd say fairly firm EDI schedules, typically ranging from two to four weeks out from where we sit today, and then less firm as you move beyond that. At this point in time, we've not seen any significant change in schedules relative to where we were a month ago.

In terms of the scheduled themselves.

Kevin Clark: Yeah. As we've talked about previously, we get schedules out through, based on where we sit today, out through the end of the year. Obviously, the closer to where we are today, the stronger the schedules. So I'd say fairly firm EDI schedules, typically ranging from two to four weeks out from where we sit today, and then less firm as you move beyond that. At this point in time, we've not seen any significant change in schedules relative to where we were a month ago.

Kevin Clark: As we've talked about previously, we get schedules out through, based on where we sit today, out through the end of the year. Obviously, the closer to where we are today, the stronger the schedules. I'd say fairly firm EDI schedules typically ranging from two to four weeks out from where we sit today, and then less firm as you move beyond that. At this point in time, we've not seen any significant change in schedules relative to where we were a month ago.

Yes, we've talked about previously.

We get schedules out through <unk>.

Just on where we sit today out through the end of the year obviously.

So closer to where we are today the stronger the schedules. So I'd say fairly firm <unk> schedules typically ranging from two to four weeks out from from where we sit today and then less firm as you go as you move beyond that.

At this point in time, we've not seen any cig.

Significant change in schedules relative to.

Where we were a month ago I think there is an element of as we look at.

Kevin Clark: I think there's an element of, as we look at what actually will flow through from a production standpoint, given the dynamic market, given the strength that we saw in the second quarter, given our kind of discussions with OEMs and kind of a view that there was some element of pull forward and that OEMs, to some extent, manage the supply base through their demand signals. We took a relatively conservative outlook for the back half of the year, which we previously had when we initially gave guidance in February in the front half of the year. So we get visibility, but just in light of the dynamics, we've decided to be somewhat conservative. I believe it's prudent to be conservative.

Kevin Clark: I think there's an element of, as we look at what actually will flow through from a production standpoint, given the dynamic market, given the strength that we saw in the second quarter, given our kind of discussions with OEMs, and kind of a view that there was some element of pull forward, and that OEMs, to some extent, manage the supply base through their demand signals. We took a relatively conservative outlook for the back half of the year, which we previously had, and we initially gave guidance in February in the front half of the year economy. So, we get visibility, but just in light of the dynamics, we've decided to be somewhat conservative or believe it's prudent to be conservative. That's very helpful. Thanks, Kevin.

I think there's an element of, as we look at what actually will flow through from a production standpoint, given the dynamic market, given the strength that we saw in the second quarter, given our kind of discussions with OEMs, and kind of a view that there was some element of pull forward, and that OEMs, to some extent, manage the supply base through their demand signals. We took a relatively conservative outlook for the back half of the year, which we previously had, and we initially gave guidance in February in the front half of the year economy. So, we get visibility, but just in light of the dynamics, we've decided to be somewhat conservative or believe it's prudent to be conservative.

What actually will flow through from a production standpoint, given the dynamic market.

Given the strength that we saw in the second quarter.

Given our discussions with.

With Oems and kind of our view that there was some element of pull forward.

And that Oems to some extent manage the supply base through through through their demand signals.

You know we we.

We took a relatively conservative outlook for the back half of the year, which we previously had when we initially gave guidance in February in the front half of the year. So.

We get visibility.

But just in light of the dynamics.

Decided to be somewhat conservative or believe it's prudent to be conservative.

Itay Michaeli: That's very helpful. Thanks, Kevin. As a follow-up, with the changing US emission standards, some automakers are expressing an intent to shift their mix to larger vehicles and take an opportunity. I'm curious whether that does present any content opportunities for you on that presumed mix shift that may happen next year.

Joe Spak: That's very helpful. Thanks, Kevin. As a follow-up, with the changing U.S. emissions standards, some automakers are expressing an intent to shift their mix to larger vehicles and take an opportunity. I am curious whether that does present any content opportunities for you on that presumed makeshift that may happen next year.

That's very helpful. Thanks, Kevin and as a follow up the changing U S emissions standard. Some automakers are expressed an intent to shift their mix to larger vehicles and have taken opportunity I'm curious whether that does present any content opportunities for you on that presumably mix shifts that may happen next year.

Kevin Clark: As a follow-up, with the changing US emission standards, some automakers are expressing an intent to shift their mix to larger vehicles and take an opportunity. I'm curious whether that does present any content opportunities for you on that presumed mix shift that may happen next year. You're talking about movement from EVs to ICE vehicles? Increased? Or more like larger vehicles within ICE, more SUVs, kind of larger vehicles given the emissions. Yeah. So to be transparent, we've already seen some of that this year. We saw some of that in Q2. So our outlook for growth in the EV that we originally had at the beginning of the year will certainly end up below our original outlook. That has been more than offset with both production schedules as well as content.

Kevin Clark: You're talking about movement from EVs to ICE vehicles? Increased? Or more like larger vehicles within ICE, more SUVs, kind of larger vehicles given the emissions. Yeah. So to be transparent, we've already seen some of that this year. We saw some of that in Q2. So our outlook for growth in the EV that we originally had at the beginning of the year will certainly end up below our original outlook. That has been more than offset with both production schedules as well as content. So absolute production schedules as well as content, certainly on large trucks in North America. So we've, in fact, offset that headwind from a slowdown of EV adoption in North America.

Kevin Clark: are talking about moving from EVs to ICE vehicles in Greek?

You are talking about moving from Evs to ice vehicles.

Joe Spak: Or more just more like larger vehicles within ICE, more SUVs, kind of larger vehicles given the emission.

With more like larger vehicles with an ice more suvs.

So kind of larger vehicles given the mission.

Kevin Clark: Yeah. So to be transparent, we have already seen some of that this year. We saw some of that in Q2. So our outlook for growth in the EV that we originally had at the beginning of the year, will certainly end up below our original outlook. That has been more than offset with both production schedules as well as content. So absent production schedules as well as content, certainly on large trucks in North America. So we have, in fact, offset that headwind from a slowdown of EV adoption in North America.

Yes.

To be transparent we've already seen some of that this year, we saw some of that in the second quarter. So our outlook for <unk>.

For growth.

EV that we originally had at the beginning of the year.

We will certainly end up below our original outlook that has been more than offset.

With both production schedules as well as content, so absolute production schedules as well as content certainly on large trucks in North America. So we've in.

Kevin Clark: So absolute production schedules as well as content, certainly on large trucks in North America. So we've, in fact, offset that headwind from a slowdown of EV adoption in North America. We'll go next to Mark Delaney with Goldman Sachs. Yes. Good morning. Thank you very much for taking my questions. I had a question on the bookings target of $31 billion. You spoke to award progress in some areas, but also an uncertain macro backdrop. And the bookings target is H2 weighted. So can you help investors better understand the visibility you have into reaching the $31 billion full year target and any key drivers that you see that would contribute to the increase in bookings in H2? Yeah. So there is a cadence for bookings. I would say we have a very strong funnel with significant visibility to bookings.

In fact <unk>.

Offset that headwind from a slowdown of EV adoption.

Operator: We'll go next to Mark Delaney with Goldman Sachs.

In North America.

Jess: We'll go next to Mark Delaney with Goldman Sachs.

We'll go next to Mark Delaney with Goldman Sachs.

Mark Delaney: Yes. Good morning. Thank you very much for taking my questions. I had a question on the bookings target of $31 billion. You spoke to award progress in some areas, but also an uncertain macro backdrop. And the bookings target is H2 weighted. So can you help investors better understand the visibility you have into reaching the $31 billion full year target and any key drivers that you see that would contribute to the increase in bookings in H2? Yeah. So there is a cadence for bookings. I would say we have a very strong funnel with significant visibility to bookings.

Mark Delaney: Yes. Good morning. Thank you very much for taking my questions. I had a question on the bookings target of $31 billion. You spoke to award progress in some areas, but also an uncertain macro backdrop. The bookings target is 2H weighted. Can you help investors better understand the visibility you have into reaching the $31 billion full-year target and any key drivers that you see that would contribute to the increase in bookings in 2H?

Yes, good morning, and thank you very much for taking my questions.

I had a question on the bookings target of 31 billion you spoke to award progress in some areas, but also an uncertain macro backdrop and the bookings target as to which weighted so can you help investors better understand the visibility you have into reaching 31 billion full year target in any key drivers that you see that would contribute to the increase in bookings into H.

Kevin Clark: Yeah. So there is a cadence for bookings. I would say we have a very strong funnel with significant visibility to bookings. I would say we have a high level of confidence that they will achieve the target that we've presented to investors. I would also tell you it's taking a little bit longer to get bookings finalized and documented. Just in light of the environment we're in, the reality is our OEM customers across the globe are spending a lot of time kind of managing through the evolving trade and regulatory landscape, in addition to working with suppliers like ourselves on new business awards. So I would say we have a reasonable level of confidence that we'll be back and loaded. We saw some amount of protracted periods between RFQs and awards last year, and we had a strong year last year.

Yes so.

There is a there is a cadence for bookings I would say we have a very strong funnel with.

Significant visibility to bookings.

Kevin Clark: I would say we have a high level of confidence that they will achieve the target that we've presented to investors. I would also tell you it's taking a little bit longer to get bookings finalized and documented. Just in light of the environment we're in, the reality is our OEM customers across the globe are spending a lot of time kind of managing through the evolving trade and regulatory landscape, in addition to working with suppliers like ourselves on new business awards. So I would say we have a reasonable level of confidence that we'll be booked and loaded. We saw some amount of protracted periods between RFQs and awards last year, and we had a strong year last year. I think you'll continue to see us have a strong year this year as well. Thanks for that, Kevin. My other question was in the non-automotive areas.

I would say we have a high level of confidence that they will achieve the targets that we've presented to investors I would also tell you, it's taking a little bit longer to get bookings finalized and documented.

Just in light of the environment. We're in the reality is our OEM customers are cost across the globe.

Are spending a lot of time kind of managing through the evolving trade and regulatory landscape.

In addition to working with suppliers like ourselves on New business Awards. So I would say, we have a reasonable level of confidence it will be backend loaded.

We saw some amount of Av protect protracted periods between.

RF queues and awards last year, and we had a strong year last year.

Kevin Clark: I think you'll continue to see us have a strong year this year as well.

I think youll continue to see us have a strong year this year as well.

Mark Delaney: Thanks for that, Kevin. My other question was in the non-automotive areas. The company's had a goal of diversifying and better addressing some of these other areas, industrial, aerospace, defense. Can you speak a bit more on what you're seeing there and whether or not you were able to grow faster in some of these non-automotive end markets? Thanks.

Thanks for that Kevin My other question was in the non automotive areas. The companies had a goal of diversifying and better addressing some of these other areas industrial aerospace defense can you speak a bit more on what youre seeing there and whether or not you were able to grow faster in some of these non automotive end markets.

Kevin Clark: The company's had a goal of diversifying and better addressing some of these other areas, industrial, aerospace, defense. Can you speak a bit more on what you're seeing there and whether or not you were able to grow faster in some of these non-automotive end markets? Thanks. Yeah. So growth has been certainly strong in Q1. It was kind of low single digits this quarter. In the back half of the year, based on our visibility, we believe it'll be solid double-digit growth. I mentioned during my prepared comments from a booking standpoint, both within the ECG business as well as the ASUX business, awards in the industrial sector, whether it's aerospace and defense, or it's broadly speaking industrial. We'll end this year with actually that particular customer category or sector being our fastest-growing market. So we're making significant progress and gaining traction. Thank you.

Kevin Clark: Yeah. So growth has been certainly strong in Q1. It was kind of low single digits this quarter. In the back half of the year, based on our visibility, we believe it'll be solid double-digit growth. I mentioned during my prepared comments from a booking standpoint, both within the ECG business as well as the ASUX business, awards in the industrial sector, whether it's aerospace and defense, or it's broadly speaking industrial. We'll end this year with actually that particular customer category or sector being our fastest-growing market. So we're making significant progress and gaining traction.

Kevin Clark: Growth has been certainly strong in the first quarter. It was kind of low single digits this quarter. In the back half of the year, based on our visibility, we believe it will be solid double-digit growth. I mentioned during my prepared comments from a booking standpoint, both within the Engineered Components business as well as the Advanced Safety and User Experience business awards in the industrial sector, whether it is aerospace and defense or, broadly speaking, industrial. We will end this year with actually that particular customer category or sector being our fastest growing market. We are making significant progress and gaining traction.

Yes. So growth is growth has has been was certainly strong in the first quarter was.

Low single digits this quarter in the back half of the year.

Based on our visibility we believe it will be solid double digit growth.

I mentioned.

During my prepared comments from a bookings standpoint, both within the ECG business as well as.

The <unk> business awards in the industrial sector, whether it's aerospace and defense.

Broadly speaking industrial.

And we will end this year with actually that particular customer category or sector.

Being our fastest growing market.

So.

So, we're making significant progress in gaining traction.

Mark Delaney: Thank you.

Thank you.

Kevin Clark: We'll go next to Dan Levy with Barclays. Hi. Good morning. Thanks for taking the questions. Good morning. I wanted to start with a question on the implied growth in the second half, and specifically the implied growth over market. I think in the first half, the growth over market or your organic growth relative to underlying active markets was something like one to two points. You're guiding to, I believe, for the full year, roughly five points. So there is some acceleration in the back half on that outgrowth. Maybe you could just talk about some of the assumptions in the second half growth change. Yeah. I think first, when you look at growth on a year-over-year basis, you certainly need to focus on Q4 of last year and what we saw from a global vehicle production relative to current outlooks, ours or IHS.

Operator: We'll go next to Dan Levy with Barclays.

Jess: We'll go next to Dan Levy with Barclays.

We will go next to Dan Levy with Barclays.

Dan Levy: Hi. Good morning. Thanks for taking the questions.

Dan Levy: Hi. Good morning. Thanks for taking the questions. Good morning. I wanted to start with a question on the implied growth in the second half, and specifically the implied growth over market. I think in the first half, the growth over market or your organic growth relative to underlying active markets was something like one to two points. You're guiding to, I believe, for the full year, roughly five points. So there is some acceleration in the back half on that outgrowth. Maybe you could just talk about some of the assumptions in the second half growth change.

Hi, Good morning, Thanks for taking my question good morning.

Kevin Clark: Morning.

Dan Levy: I wanted to start with a question on the implied growth in the second half and specifically the implied growth over market. I think in the first half, the growth over market or your organic growth relative to underlying active markets was something like 1 to 2 points. You are guiding to, I believe, for the full year, roughly 5 points. There is some acceleration in the back half on that outgrowth. Maybe you could just talk about some of the assumptions in the second half growth change.

I wanted to start with a question on the implied growth in the second half and specifically the implied growth over market I think in the first half.

The growth over market.

Our organic growth relative to.

Underlying active markets with something like one to two points, you're guiding to I believe for the full year roughly five so there is.

On acceleration in the back half on that.

Outgrowth, maybe you could just talk about some of the assumptions in the second half growth.

Kevin Clark: Yeah. I think first, when you look at growth on a year-over-year basis, you certainly need to focus on Q4 of last year and what we saw from a global vehicle production relative to current outlooks, ours or IHS. So I think you got to keep that in mind. When you unpack our acceleration of growth in the back half, where you see the most significant sort of pickup is certainly within the ASUX business. You also see significant pickup in growth as it relates to our EDS business. So those would be the two biggest drivers. I would say from an overall growth rate, ECG stays roughly in line with how it's grown year to date.

Sure.

Kevin Clark: Yeah. I think first, when you look at growth on a year-over-year basis, you certainly need to focus on Q4 of last year and what we saw from a global vehicle production relative to current outlooks, ours or IHS. So I think you have to keep that in mind. When you unpack our acceleration of growth in the back half, where you see the most significant sort of pickup is certainly within the Advanced Safety and User Experience. Within the Advanced Safety and User Experience business, you also see significant pickup in growth as it relates to our Electrical Distribution Systems business. So those would be the two biggest drivers. I would say from an overall growth rate, Engineered Components stays roughly in line with how it has grown year to date.

Yes, I think first when you look at.

When you look at growth on a year over year basis.

You certainly need to focus on Q4 of last year and what we saw from a from a global vehicle production relative to <unk>.

Current outlets ours or IHS, So I think you got it.

Kevin Clark: So I think you got to keep that in mind. When you unpack our acceleration of growth in the back half, where you see the most significant sort of pickup is certainly within the ASUX business. You also see significant pickup in growth as it relates to our EDS business. So those would be the two biggest drivers. I would say from an overall growth rate, ECG stays roughly in line with how it's grown year to date. And then if you unpack ASUX, a big piece of that is the ongoing launch of ADAS programs principally in North America and Europe, partially offset by that reference to Chinese OEM programs that will be a headwind, but we'll still see acceleration in growth.

Fine.

When you.

When you unpack our acceleration of growth.

In the back half where you see.

The most significant.

Pickup is certainly within the ASU works.

Within the <unk> business.

You also see Cigna.

Significant pick up in growth.

As it relates to.

Our Etfs business. So those would be the two biggest drivers I would say from an overall growth rate ECG stayed roughly in line with with how it's grown year to date.

Kevin Clark: If you unpack Advanced Safety and User Experience, a big piece of that is the ongoing launch of ADAS programs principally in North America and Europe, partially offset by that reference to the two Chinese OEM programs that will be a headwind, but we will still see acceleration and growth. At Electrical Distribution Systems, we see strong growth continuing, certainly in the third quarter, part of that year-over-year comp, and then actually slowing a little bit in the fourth quarter, which is also a, if you remember, fourth quarter of last year, Electrical Distribution Systems had a very strong fourth quarter last year. So the comp is pretty tough.

And then if you unpack ASUX, a big piece of that is the ongoing launch of ADAS programs principally in North America and Europe, partially offset by that reference to Chinese OEM programs that will be a headwind, but we'll still see acceleration in growth. And at EDS, we see strong growth continuing, certainly in Q3, part of that year-over-year comp, and then actually slowing a little bit in Q4, which is also a, if you remember, Q4 last year, EDS had a very strong Q4 last year. So the comp is pretty tough.

And then as you unpack.

If you unpack asus's a big piece of that is.

Is the ongoing launch of Adas programs, principally in North America and Europe.

Partially offset by that referenced to the two Chinese.

OEM programs that will be a headwind, but we will still see acceleration in growth.

Kevin Clark: And at EDS, we see strong growth continuing, certainly in Q3, part of that year-over-year comp, and then actually slowing a little bit in Q4, which is also a, if you remember, Q4 last year, EDS had a very strong Q4 last year. So the comp is pretty tough. Great. And there's not one specific launch that you're dependent on for that this is weighted to, correct? No. Listen, we're launching this year; we'll launch over 2,500 programs, Dan. So it's multiple programs that are being launched during the year that affect that back half inflection. Okay. Great. Thank you. And then the second question is around capital allocation. And maybe you could just revisit the framework specifically with the EDS spin. Now it sounds like you're pulling that forward. How should we think about capital allocation dynamics in the future post-EDS spin?

And at EES, we see.

Strong growth continuing certainly in the third quarter part of that year over year comp.

And then actually slowing a little bit in the fourth quarter, which is also a if you remember fourth quarter last year <unk> had a very strong fourth quarter last year. So the comp is pretty tough.

Dan Levy: Great. And there's not one specific launch that you're dependent on for that this is weighted to, correct?

Dan Levy: Great. There's not one specific launch that you're dependent on or that this is weighted to, correct?

Great and there is not one specific launch that youre dependent or that this is a weighted to correct.

Kevin Clark: No. Listen, we're launching this year; we'll launch over 2,500 programs, Dan. So it's multiple programs that are being launched during the year that affect that back half inflection.

Kevin Clark: No. Listen, we are launching this year, we will launch over 2,500 programs to end. So it is multiple programs that are being launched during the year that affect that back half influx.

No listen we are launching this year, we will launch over 2500.

Programs. So it's it's it's.

<unk> multiple programs that are being that are being launched.

During the year that affect that back half influx.

Dan Levy: Okay. Great. Thank you. And then the second question is around capital allocation. And maybe you could just revisit the framework specifically with the EDS spin. Now it sounds like you're pulling that forward. How should we think about capital allocation dynamics in the future post-EDS spin? Especially on the inorganic side, what types of targets you may be seeking?

Yes.

Dan Levy: Okay, great. Thank you. The second question is around capital allocation. Maybe you could just revisit the framework specifically with the Electrical Distribution Systems spin. Now it sounds like you are pulling that forward. How should we think about capital allocation dynamics in the future post-Electrical Distribution Systems spin? Especially on the inorganic side, what types of targets you may be seeking?

Okay, great. Thank you.

Then.

The question is around.

Capital allocation and maybe you could just.

Revisit the framework specifically with the.

The eds spin.

Now it sounds like Youre pulling that forward, how should we think about capital allocation dynamics.

In the future, both eds spin and especially on the inorganic side what types of targets you may be seeking.

Kevin Clark: Especially on the inorganic side, what types of targets you may be seeking? Sure. So first, we're not pulling the EDS spin forward. We're still on a path where we'll spin the business at the end of Q1 2026. We're obviously just given the size of that business. There's a lot of time spent by management focusing on moving that, continuing to move that forward. So I want to make sure I correct you on that. As it relates to capital allocation, starting with the EDS spin, that's a business that we're very focused on having very manageable leverage out of the gate. So there'll be an element of leverage on that business and a dividend to Aptiv. That cash will be used to pay down some amount of debt.

Kevin Clark: Sure. So first, we're not pulling the EDS spin forward. We're still on a path where we'll spin the business at the end of Q1 2026. We're obviously just given the size of that business. There's a lot of time spent by management focusing on moving that, continuing to move that forward. So I want to make sure I correct you on that. As it relates to capital allocation, starting with the EDS spin, that's a business that we're very focused on having very manageable leverage out of the gate. So there'll be an element of leverage on that business and a dividend to Aptiv. That cash will be used to pay down some amount of debt.

Kevin Clark: Sure. First, we are not pulling the Electrical Distribution Systems spin forward. We are still on a path where we will spin the business at the end of the first quarter of 2026. We are obviously, given the size of that business, there is a lot of time spent by management focusing on moving that, continuing to move that forward. I want to make sure I correct you on that. As it relates to capital allocation, starting with the Electrical Distribution Systems spin, that is a business that we are very focused on having very manageable leverage out of the gate. There will be an element of leverage on that business and a dividend to Aptiv PLC.

Sure. So so first we're not pulling the eds been four we're still on a path.

Where will spin the business at the end of the first quarter of 2026, we're obviously just given the size of that business. There's a lot of time spent by management.

Focusing on moving that continue to move that forward. So wanted to be sure and correct me on that as it relates to.

Capital allocation, starting with Etfs and Thats a business that we're.

We're very focused on having very manageable leverage.

Out of the gate.

So there'll be an element of leverage on that business and the dividend dividend to active that cash will be used to pay down some amount of debt.

Kevin Clark: That cash will be used to pay down some amount of debt. We will continue to deleverage during the back half of this year and into 2026, certainly at RemainCo, partly as a result of earnings growth, partly as a result of select debt paydown. When we look at priorities from a capital allocation standpoint, as of right now, we have made the decision for the first couple of quarters that we are going to really sit on cash, evaluate the environment. We will continue to sit on cash during this quarter. Priorities are really first M&A opportunities in the Engineered Components and in the Advanced Safety and User Experience space, principally in assets that have exposure outside of the automotive market.

Kevin Clark: We'll continue to deleverage during the back half of this year and into 2026, certainly at Remainco, partly as a result of earnings growth, partly as a result of select debt paydown. When we look at priorities from a capital allocation standpoint, as of right now, we've made the decision for the first couple of quarters that we're going to really sit on cash, evaluate the environment. We'll continue to sit on cash during this quarter. And then priorities are really first M&A opportunities in the engineered components and in the ASUX space, principally in assets that have exposure outside of the automotive market. Great. That's helpful. Thank you. We'll go next to Joe Spak with UBS. Thanks. Good morning, everyone. Maybe, Kevin, just to start, just a few points of clarification.

We'll continue to deleverage during the back half of this year and into 2026, certainly at Remainco, partly as a result of earnings growth, partly as a result of select debt paydown. When we look at priorities from a capital allocation standpoint, as of right now, we've made the decision for the first couple of quarters that we're going to really sit on cash, evaluate the environment. We'll continue to sit on cash during this quarter. And then priorities are really first M&A opportunities in the engineered components and in the ASUX space, principally in assets that have exposure outside of the automotive market.

We will continue to deleverage.

During the back half of this year and into 2026, certainly at remain co partly.

As a result of earnings growth, partly as a result of select debt pay down.

When we look at priorities from a capital allocation standpoint.

<unk> it.

As of as of right now we've made the decision for the first couple of quarters that we're going to really sit on cash.

Evaluate the environment will continue to sit on cash during this quarter and then priorities are really first.

M&A opportunities.

In the engineered components and and in the <unk> space.

Principally in assets that have exposure outside of the automotive market.

Dan Levy: Great. That's helpful. Thank you.

Dan Levy: Great. That's awesome. Thank you.

Great. That's helpful. Thank you.

Jess: We'll go next to Joe Spak with UBS.

Operator: We'll go next to Joe Spak with UBS. Thanks.

We'll go next to Joe Spak with UBS.

Joe Spak: Thanks. Good morning, everyone. Kevin, just to start, just a few points of clarification. One, when you are saying second quarter, pull forward to demand, I just want to be sure you are talking about consumer demand of vehicles and you shipping to that, or do you think there was actual channel inventory builds? You shipped more than production. I will let you answer that.

Joe Spak: Good morning, everyone. Maybe, Kevin, just to start, just a few points of clarification. One, when you're saying Q2 pull forward to demand, I just want to be sure you're talking about consumer demand of vehicles and you shipping to that, or do you think there was actual channel inventory built like you shipped more than production? And then I'll answer that.

Thanks, Good morning, everyone.

But maybe Kevin just to start.

Just a few.

A few points of clarification one.

Kevin Clark: One, when you're saying Q2 pull forward to demand, I just want to be sure you're talking about consumer demand of vehicles and you shipping to that, or do you think there was actual channel inventory built like you shipped more than production? And then I'll answer that. Yeah. I think an element of both the schedules we receive from our customers and the number of vehicles our customers produced. So I think it's a mix. Obviously, those two are aligned. I think, Joe, it's difficult to be precise on how much of that took place. But just based on our dialogue with customers and kind of the timing of changes, I think it's reasonable to assume that there's some element of pull forward to production. Fair enough.

When you're saying second quarter pull forward of demand I just wanted to be sure you're talking about consumer demand of vehicles and you're shipping to that or do you think there was.

Actual channel inventory builds like you shipped to more than production and then.

Hello to answer that.

Kevin Clark: Yeah. I think an element of both the schedules we receive from our customers and the number of vehicles our customers produced. So I think it's a mix. Obviously, those two are aligned. I think, Joe, it's difficult to be precise on how much of that took place. But just based on our dialogue with customers and kind of the timing of changes, I think it's reasonable to assume that there's some element of pull forward to production.

Kevin Clark: I think an element of both the schedules we receive from our customers and the number of vehicles our customers produced. I think it is a mix. Obviously, those two are aligned. I think, Joe, it is difficult to be precise on how much of that took place. Based on our dialogue with customers and the timing of changes, I think it is reasonable to assume that there is some element of pull forward in production.

Yes, I think an element of both.

The schedules, we received from our customers and.

The number of vehicles, our customers produced so I think it's a mix.

Obviously, those two are aligned.

I think Joe it's difficult to be precise on how much of that took place, but just based on our dialogue with customers and.

Kind of the timing of changes I think it is reasonable to assume that there is some element of a pull forward of production.

Joe Spak: Fair enough. The second clarification just on the implied Q3, Q4 guidance, there's, it looks like revenue is really pretty flat, Q3 to Q4, but big step up in margins. Is that just sort of the normal seasonality you see in engineering recoveries, or is there anything else that sort of drives that fourth quarter margin higher than the third quarter?

Joe Spak: Fair enough. The second clarification just on the implied Q3, Q4 guidance, it looks like revenue is really pretty flat Q3 to Q4, but big step up in margins. Is that just sort of the normal seasonality you see in engineering recoveries, or is there anything else that sort of drives that fourth quarter margin higher than the third quarter?

Fair enough.

Kevin Clark: The second clarification just on the implied Q3, Q4 guidance, there's, it looks like revenue is really pretty flat, Q3 to Q4, but big step up in margins. Is that just sort of the normal seasonality you see in engineering recoveries, or is there anything else that sort of drives that fourth quarter margin higher than the third quarter? Yeah. From a year-over-year growth rate, it's really important that you look at the prior quarters, right? And to a certain extent, we were impacted slightly differently by business Q3 and Q4 last year. And if you look at overall production, you'll see a few anomalies in Q3 and Q4, right? Q4 vehicle production last year was the highest Q4 it's been. And I think you can go back for a very long period of time.

Second clarification, just on the <unk>.

Implied.

<unk> <unk> guidance like you.

You know it looks like revenues.

Pretty flat <unk>, but big step up in margins. So that just sort of the normal seasonality you see in engineering recoveries is there anything else that sort of drives that that fourth quarter margin higher than the third quarter from a year over year growth rate is really important that you look at the prior quarters right.

Kevin Clark: Yeah. From a year-over-year growth rate, it's really important that you look at the prior quarters, right? And to a certain extent, we were impacted slightly differently by business Q3 and Q4 last year. And if you look at overall production, you'll see a few anomalies in Q3 and Q4, right? Q4 vehicle production last year was the highest Q4 it's been. And I think you can go back for a very long period of time.

Kevin Clark: From a year-over-year growth rate, it is really important that you look at the prior quarters. To a certain extent, we were impacted slightly differently by the business Q3 and Q4 last year. If you look at overall production, you will see a few anomalies in Q3 and Q4. Q4 vehicle production last year was the highest Q4 it has been. I think you can go back for a very long period of time. On a sequential basis, it was up roughly 10%, give or take a couple of points. When you look at that fourth quarter growth rate on a year-over-year basis, a portion of our business, especially our EDS business, gets impacted. Q3, given our customer mix in Q3, obviously, you will see strong growth there. I think it is important you look at it that way.

To a certain extent were impacted slightly differently by business Q3, Q4 of last year.

And if you look at overall production, you'll see a few anomalies in Q3 and Q4 right.

For vehicle production.

Last year was the highest Q4 it has been.

I think you can go back.

For a very long period of time, and I think on a sequential basis. It was up roughly 10% give or take a couple of points. So when you look at that fourth quarter growth rate on a year over year basis.

Kevin Clark: And I think on a sequential basis, it was up roughly 10%, give or take a couple of points. So when you look at that fourth quarter growth rate on a year-over-year basis, a portion of our business, especially our EDS business, gets impacted. In Q3, given our customer mix in Q3, obviously, you'll see strong growth there. So I think it's important you look at it that way. I think as you look at margin, how margin plays out in Q3, Q4, it's really about the continued benefit of the cost actions we've taken last year and this year, and the timing associated with those. And then it's, to your point, Joe, it's the timing of engineering credits, which tend to be back-loaded in our business, principally more of that in the fourth quarter than the third quarter. Okay.

And I think on a sequential basis, it was up roughly 10%, give or take a couple of points. So when you look at that fourth quarter growth rate on a year-over-year basis, a portion of our business, especially our EDS business, gets impacted. In Q3, given our customer mix in Q3, obviously, you'll see strong growth there. So I think it's important you look at it that way. I think as you look at margin, how margin plays out in Q3, Q4, it's really about the continued benefit of the cost actions we've taken last year and this year, and the timing associated with those. And then it's, to your point, Joe, it's the timing of engineering credits, which tend to be back-loaded in our business, principally more of that in the fourth quarter than the third quarter.

A portion of our business, especially our ETS business gets impacted.

Q3, given our customer mix in Q3, obviously youll see strong growth. There. So I think it's important you look at it that way I think as you look at as you look at margin how margin plays out in Q3 Q4, it's really about.

Kevin Clark: I think as you look at margin, how margin plays out in Q3, Q4, it is really about the continued benefit of the cost actions we have taken last year and this year and the timing associated with those. Then it is, to your point, Joe, it is the timing of engineering credits, which tend to be back and loaded in our business, principally more of that in the fourth quarter than the third quarter.

<unk>.

The continued benefit of the cost actions, we've taken last year and this year and the timing associated with those and then as to your point, Joe. It's the timing of engineering of engineering credits, which tend to be backend loaded in our business principally more of that in the fourth quarter than the third quarter.

Joe Spak: Okay. Second question, just on the 85% of your day bookings with the local Chinese OEMs, does that tend to come on quicker than some other bookings you have? We've heard from some other suppliers it could be a pretty short period of time from when to launch, like around a year. Then maybe you could just shed a little bit of light on how on what's really driving this acceleration, how you're winning. Is it just a refocus on those customers? Are there new products or any major differences in profitability, anything like that?

Joe Spak: Okay. Then second question, just on the 85% of your day bookings with the local Chinese OEMs, does that tend to come on quicker than some other bookings you have? We have heard from some other suppliers, there could be a pretty short period of time from when to launch, like around a year. Maybe you could just shed a little bit of light on what is really driving this acceleration, how you are winning. Is it just a refocus on those customers? Are there new products or any major differences in profitability? Anything like that?

Alright.

Kevin Clark: Second question, just on the 85% of your day bookings with the local Chinese OEMs, does that tend to come on quicker than some other bookings you have? We've heard from some other suppliers it could be a pretty short period of time from when to launch, like around a year. Then maybe you could just shed a little bit of light on how on what's really driving this acceleration, how you're winning. Is it just a refocus on those customers? Are there new products or any major differences in profitability, anything like that? Yeah. Listen, we've been talking about this for quite some time. I wouldn't say it's new focus. It's focus we've had for the last couple of years where we're making progress. Joe, you're familiar with our China team. It's a China-based team that's localized.

Then second question just on the 85% of your de bookings with the local Chinese Oems.

Does that.

Does that tend to come on quicker than.

Some other bookings you have like we've heard from some other suppliers it could be a pretty short.

Period of time from when to launch like around a year and then maybe you could just shed a little bit of light on.

How.

On what's really driving that acceleration, how you're winning is it just a refocus on those customers are there new products or any major differences in profitability or anything like that.

Kevin Clark: Yeah. Listen, we've been talking about this for quite some time. I wouldn't say it's new focus. It's focus we've had for the last couple of years where we're making progress. Joe, you're familiar with our China team. It's a China-based team that's localized.

Kevin Clark: Listen, we have been talking about this for quite some time. I would not say it is new focus. It is focus we have had for the last couple of years where we are making progress. Joe, you are familiar with our China team. It is a China-based team that is localized. Our product capabilities, our engineering capabilities, manufacturing, supply chain are all focused on the China market and have been for a very, very long period of time. I think it is the strength of our product portfolio. I think we leverage our global scale. I referenced in my prepared comments the award from Leap Motor for their European vehicles, our Gen 6 ADAS solution. We have other awards across our segments that relate to programs in China and outside of China.

Yes listen we're we've been talking about this for quite for quite some time I Wouldnt say its new focus its focus we've had for the last couple of years, where we're where we're making progress.

Joe you are familiar with our China team, it's a China based team that that's localized our product capabilities are engineering capabilities manufacturing supply chain are all focused on the China market and have been for a very very long period of time.

Kevin Clark: Our product capabilities, our engineering capabilities, manufacturing, and supply chain are all focused on the China market and have been for a very, very long period of time. So I think it's the strength of our product portfolio. I think we leverage our global scale. I referenced in my prepared comments the award from Leapmotor for their European vehicles, our Gen 6 ADAS solution. We have other awards across our segments that relate to programs in China and outside of China. The major players, we have business awarded for both export as well as for programs that they're launching out of Europe or South America. There's more to come there. So it's an area we continue to focus on. And to your point, in terms of between award and launch, I would say one year is long.

Our product capabilities, our engineering capabilities, manufacturing, and supply chain are all focused on the China market and have been for a very, very long period of time. So I think it's the strength of our product portfolio. I think we leverage our global scale. I referenced in my prepared comments the award from Leapmotor for their European vehicles, our Gen 6 ADAS solution. We have other awards across our segments that relate to programs in China and outside of China. The major players, we have business awarded for both export as well as for programs that they're launching out of Europe or South America. There's more to come there. So it's an area we continue to focus on. And to your point, in terms of between award and launch, I would say one year is long.

So I think it's the strength of our of our product portfolio I think we leverage our global scale I referenced in my prepared comments the award from Leap motor for their.

Their European vehicles, our Gen six Adas solution.

We have other awards.

Across our segments that relate to programs in China and outside of China.

Sure.

Kevin Clark: The major players we have business awarded for both export as well as for programs that they are launching out of Europe or South America. There is more to come there. It is an area we continue to focus on. And to your point, in terms of between award and launch, I would say one year is long. I would say it is six to nine months, quite frankly, at this point in time from a pace standpoint. That ranges anywhere from wire harnesses to interconnects to Active Safety or User Experience systems. So it is very rapid. Having said that, it is a very dynamic environment. I made the comment about the Zeekr and NIO programs, which they are important customers, but we were on a couple of vehicle platforms, for example, with Zeekr, where those platforms are not doing well in the China market.

The major players were we have business awarded for both export.

As well as for our programs that are launching out of Europe or South America. There is more to come there.

It's an area we continue to focus on.

And to your point in terms of between award and launch it's I would say one year is long.

Kevin Clark: I would say it's six to nine months, quite frankly, at this point in time from a pace standpoint. That ranges anywhere from wire harnesses to interconnects to Active Safety or User Experience systems. So it's very rapid. Having said that, it's a very dynamic environment. I made the comment about the Zeekr and NIO programs, which they're important customers, but we're on a couple of vehicle platforms, for example, with Zeekr, where those platforms are not doing well in the China market. We saw a fairly rapid reduction in production schedules beginning Q2 that will affect us in Q3 and Q4 that we're working through. The positive is we continue to book a lot of business, and we're confident we're able to replace that volume as we exit Q4 and head into next year. Great. Very helpful. Thanks. We'll go next to Emmanuel Rosner with Wolfe Research.

I would say it's six to nine months, quite frankly, at this point in time from a pace standpoint. That ranges anywhere from wire harnesses to interconnects to Active Safety or User Experience systems. So it's very rapid. Having said that, it's a very dynamic environment. I made the comment about the Zeekr and NIO programs, which they're important customers, but we're on a couple of vehicle platforms, for example, with Zeekr, where those platforms are not doing well in the China market. We saw a fairly rapid reduction in production schedules beginning Q2 that will affect us in Q3 and Q4 that we're working through. The positive is we continue to book a lot of business, and we're confident we're able to replace that volume as we exit Q4 and head into next year.

I would say.

Six to nine months quite frankly at this point in time from a pace standpoint, and that ranges anywhere from wire harnesses to interconnects to active safety or user experience systems. So its very rapid.

Having said that it's a very dynamic environment.

I made the comment about.

The Zika and Neil programs, which which they are important customers, but we were on a couple of vehicle platforms. For example, with seeker, where those platforms are not doing well in the China market and we saw a fairly rapid reduction in production schedules.

Kevin Clark: We saw a fairly rapid reduction in production schedules beginning in Q2 that will affect us in Q3 and Q4 that we are working through. The positive is we continue to book a lot of business, and we are confident we are able to replace that volume as we execute for and head into next year.

Beginning in Q2 that will affect us in Q3, and Q4 that were working through a positive as we continue to book a lot of business and were confident were able to replace that volume as we exit Q4 and head into next year.

Joe Spak: Great. Very helpful. Thanks.

Okay very helpful. Thanks.

Jess: We'll go next to Emmanuel Rothner with Wolfe Research.

Operator: We'll go next to Emmanuel Rosner with Wolfe Research.

We'll go next to Emmanuel Rosner with Wolfe research.

Emmanuel Rothner: Great. Thank you so much. I wanted to get a few more thoughts from you on the trajectory of Active Safety and User Experience revenues. They were down 3% in the quarter. You flagged some roll-off of legacy User Experience programs and some unfavorable mix in China. Generally, can you lay out the growth narrative for this business? I think you have launches in the back half. How should we think about a forward growth trajectory for Active Safety and User Experience?

Kevin Clark: Great. Thank you so much. I wanted to get a few more thoughts from you on the trajectory of AS and UX revenues. They were down 3% in the quarter. You flagged some roll-off of legacy UX programs. But generally. And then some unfavorable mix in China. But generally, can you lay out the growth narrative for this business? I think you have launches in the back half. How should we think about sort of like a forward growth trajectory for AS and UX in here? Yeah. So it's a great question. And it's a business that sits in place where content for vehicle is growing. Emmanuel, as you know, we have a headwind that we've talked about in terms of that legacy user experience program.

Emmanuel Rosner: Great. Thank you so much. I wanted to get a few more thoughts from you on the trajectory of AS and UX revenues. They were down 3% in the quarter. You flagged some roll-off of legacy UX programs. But generally. And then some unfavorable mix in China. But generally, can you lay out the growth narrative for this business? I think you have launches in the back half. How should we think about sort of like a forward growth trajectory for AS and UX in here?

Great. Thank you so much.

I wanted to get.

Again, a few more thoughts from you on the trajectory of <unk> and the UX revenues they were down.

3% in the quarter, you flagged some roll off of legacy.

<unk> programs.

But.

Jeremy and then some unfavorable mix in China, but generally can you lay out the the growth narrative for this business I think you have launches in the back half how should we think about sort of an ikea forward growth.

So yes.

Kevin Clark: Yeah. So it's a great question. And it's a business that sits in place where content for vehicle is growing. Emmanuel, as you know, we have a headwind that we've talked about in terms of that legacy user experience program.

Kevin Clark: Yeah, so it is a great question. It is a business that sits in a place where content per vehicle is growing. As you know, we have a headwind that we have talked about in terms of that legacy User Experience program. When you look at our overall growth rate on a quarter-to-quarter basis, year-over-year basis, however you want to look at it, it is worth 200 to 300 bps as that program winds down. We get to finally lapping it beginning in Q1 next year. So that wind-down ends at the end of the fourth quarter of this year. So that has had over the last this past year, certainly an impact on our overall growth rate. Our outlook for Active Safety is that it will grow roughly 6% this year, so mid-single digits.

Yes.

It's a great question and.

It's a business that sits in a place where content per vehicle is growing EMEA.

Emmanuel as you know we have a headwind that we've talked about in terms of that legacy user experience program.

Kevin Clark: That when you look at our overall growth rate on a quarter-to-quarter basis, year-over-year basis, however you want to look at it, it's worth 200 to 300 basis points as that program winds down. And we get to finally lapping it beginning in Q1 next year. So that wind down ends at the end of the fourth quarter of this year. So that's had, over the last this past year, certainly an impact on our overall growth rate. Active Safety, our outlook for Active Safety is that it'll grow roughly 6% this year, so mid-single digits. That, unfortunately, is a bit impacted by the China programs that I just mentioned, those OEM programs I mentioned. A couple of those are actually ADAS programs. So that is a bit of a headwind.

That when you look at our overall growth rate on a quarter-to-quarter basis, year-over-year basis, however you want to look at it, it's worth 200 to 300 basis points as that program winds down. And we get to finally lapping it beginning in Q1 next year. So that wind down ends at the end of the fourth quarter of this year. So that's had, over the last this past year, certainly an impact on our overall growth rate. Active Safety, our outlook for Active Safety is that it'll grow roughly 6% this year, so mid-single digits. That, unfortunately, is a bit impacted by the China programs that I just mentioned, those OEM programs I mentioned. A couple of those are actually ADAS programs. So that is a bit of a headwind.

That when you look at our overall growth rate on a quarter to quarter basis year over year basis. How are you going to look at it is worth two to 300 basis points as that program winds down.

And we get tough finally lapping it.

Beginning in Q1 next year so.

That wind down ends at the end of the fourth fourth quarter of this year. So that has had over the last this past year certainly an impact on our overall growth rate.

Active safety.

Our outlook for active safety.

Is that it will grow.

Roughly 6%.

This year, so mid single digits.

Kevin Clark: That unfortunately is a bit impacted by the China programs that I just mentioned, those OEM programs I mentioned. A couple of those are actually ADAS programs. So that is a bit of a headwind. As you head into 2026, we are confident that we are in that kind of mid-single-digit sort of growth rate as it relates to the AS/UX business, just given new program launches as well as that headwind coming to an end, that User Experience headwind coming to an end.

That unfortunately is a bit impacted.

By that Chinese China programs that I, just mentioned those OEM programs I mentioned.

A couple of those are actually Adas programs. So that is a.

A bit of a headwind, but as you head into 2026, we're confident that we're in that mid single digit sort of growth rate as it relates to the <unk> business just given.

Kevin Clark: But as you head into 2026, we're confident that we're in that kind of mid-single digit sort of growth rate as it relates to the AS UX business, just given new program launches as well as that headwind coming to an end, that user experience headwind coming to an end. Yeah. That's very helpful. And then second topic for me, I wanted to ask you about the ECG margins. They decreased in the quarter versus last year, even though organic revenues were actually up a very good clip. Maybe some FX and commodities in there. But I guess more generally, where do you think ECG margins can go? Listen, this quarter was all FX and commodity prices. So that was the headwind. We're facing significant headwinds principally as it relates to the peso. So we're hedged down to 2019. And I'll let Varun talk about it.

But as you head into 2026, we're confident that we're in that kind of mid-single digit sort of growth rate as it relates to the AS UX business, just given new program launches as well as that headwind coming to an end, that user experience headwind coming to an end.

New program launches as well as.

That headwind coming to an end that.

That user experience headwind coming to them.

Emmanuel Rosner: Yeah. That's very helpful. And then second topic for me, I wanted to ask you about the ECG margins. They decreased in the quarter versus last year, even though organic revenues were actually up a very good clip. Maybe some FX and commodities in there. But I guess more generally, where do you think ECG margins can go?

Emmanuel Rothner: That's very helpful. The second topic for me, I wanted to ask you about the ECG margins. They decreased in the quarter versus last year, even though organic revenues were actually up a very good split. I think maybe some FX and commodities in there. I guess more generally, where do you think ECG margins can go?

Yeah, that's very helpful.

And then second topic for me.

When addressed your about the ECG margins.

The decrease in the quarter versus last year, even though organic revenues, which you have a very good clip.

Maybe some FX and commodities in there, but I guess more generally.

Do you think ECG margins can go.

Kevin Clark: Listen, this quarter was all FX and commodity prices. So that was the headwind. We're facing significant headwinds principally as it relates to the peso. So we're hedged down to 2019. And I'll let Varun talk about it. But that's been a significant headwind for that business, for the margin profile of our EDS business, and then to some extent, lesser extent, our AS UX business. But Varun, I should let you answer this.

Kevin Clark: Listen, this quarter was all FX and commodity prices. That was the headwind. We are facing significant headwinds, principally as it relates to the pay zone. We are hedged down to 19. I will let Varun Laroyia talk about it. That has been a significant headwind for that business, for the margin profile of our Electrical Distribution Systems business, and then to some extent, lesser extent, our Advanced Safety and User Experience business. Varun Laroyia, I should let you answer this.

It's listen this quarter was off FX and commodity prices.

That was the headwind we're facing.

Significant headwinds principally as it relates to the peso.

We're hedged down down.

<unk>.

To 19, and I'll, let Darren talk about it but that's been a significant headwind for that business for the margin profile of our.

Kevin Clark: But that's been a significant headwind for that business, for the margin profile of our EDS business, and then to some extent, lesser extent, our AS UX business. But Varun, I should let you answer this. Yeah. No, I think, Kevin, you've kind of pretty much answered that. Emmanuel, if you think of the points that Kevin just mentioned right on, and as you think of the second half of the year, we do see the seasonal uptick in margins in the ECG business also. So outside of the FX piece that we pulled out, kind of Mexican peso, we do see ECG margins recovering in the second half of the year. And I think in terms of ECG margin opportunity, right, where we sit today from an EBITDA standpoint, we'll end the year at, I don't know, roughly 22% sort of EBITDA margins. We'll continue to see those increase.

Of our EES business, and then to some extent lesser extent <unk>.

I should let you answer this yes, I think Kevin you can pretty much answer that.

Varun Laroyia: Yeah. No, I think, Kevin, you've kind of pretty much answered that. Emmanuel, if you think of the points that Kevin just mentioned right on, and as you think of the second half of the year, we do see the seasonal uptick in margins in the ECG business also. So outside of the FX piece that we pulled out, kind of Mexican peso, we do see ECG margins recovering in the second half of the year. And I think in terms of ECG margin opportunity, right, where we sit today from an EBITDA standpoint, we'll end the year at, I don't know, roughly 22% sort of EBITDA margins. We'll continue to see those increase.

Varun Laroyia: Yeah, no, I think, Kevin, you've kind of pretty much answered that. As you think of the points that Kevin just mentioned, and as you think of the second half of the year, we do see the build uptake in margins in the Electrical Distribution Systems business also. So outside of the FX, as you said before, that kind of Mexican peso, we do see Electrical Distribution Systems margins recovering in the second half of the year.

If you think of the points that Kevin just mentioned right on and as we think of the second half of the year, we do see the seasonal uptick in margins in the ECG business also so outside of the FX pieces before about kind of Mexican peso.

We do see ECG margins.

A recovering in the second half of the year.

Kevin Clark: I think in terms of ECG margin opportunity, where we sit today from an EBITDA standpoint, we will end the year at, I do not know, roughly 22% sort of EBITDA margins. We will continue to see those increase. In 2022, they were at under 20%. So we have seen significant improvement in margins as we continue to grow, especially outside of automotive in the industrial sectors where our margin rates are much higher. Just to remind everybody, for us in this business, that sector is growing faster than our traditional automotive sector. We will naturally see an increase in the margins as well.

And I think in terms of ECG margin opportunity right, where we where we sit today from a EBITDA standpoint.

We'll end the year at <unk>.

Roughly 22% sort of.

EBITDA margins.

We'll continue to see those increase.

Kevin Clark: 2022, they were at under 20. So we've seen significant improvement in margins. As we continue to grow, especially outside of automotive, in the industrial sectors, where our margin rates are much higher. And just to remind everybody, for us in this business, that sector is growing faster than our traditional automotive sector. We'll naturally see an accretion of margins as well. Great. Thank you. Thank you. We'll go next to Chris McNally with Evercore. Hey, Kevin. Thanks so much, team. So I appreciate the conservatism. I think we all know there's a lot that needs to happen, particularly around the Mexico trade deal, which seems next. So Kevin, that's sort of my first high-level question. You guys are always pretty connected in DC. And if we step back, what do you think the industry is asking for at this point?

2022, they were at under 20. So we've seen significant improvement in margins. As we continue to grow, especially outside of automotive, in the industrial sectors, where our margin rates are much higher. And just to remind everybody, for us in this business, that sector is growing faster than our traditional automotive sector. We'll naturally see an accretion of margins as well.

2022, they were at.

Under 20.

So we've seen significant improvement in margins as we continue to grow, especially outside of automotive and the industrial sectors.

Where our margin rates are much higher.

And just to remind everybody for us in this business that sector is growing faster than our traditional automotive sector, we will naturally see accretion to margins as well.

Emmanuel Rosner: Great. Thank you.

Varun Laroyia: Great. Thank you.

Great. Thank you.

Varun Laroyia: Thank you.

Operator: We'll go next to Chris McNally with Evercore.

Thank you.

Jess: We'll go next to Chris McNally with Evercore.

We'll go next to Chris Mcnally with Evercore.

Chris McNally: Hey, Kevin. Thanks so much, team. So I appreciate the conservatism. I think we all know there's a lot that needs to happen, particularly around the Mexico trade deal, which seems next. So Kevin, that's sort of my first high-level question. You guys are always pretty connected in DC. And if we step back, what do you think the industry is asking for at this point? Is it sort of 15% like all the other countries, or is there a case that USMCA compliant vehicles could get something better? Just curious, super high level, what you think the industry is asking for, or really, in your opinion, should be asking for for good policy going forward?

Dan Levy: Hi, Kevin. Thanks so much, team. I appreciate the conservatism. I think we all know there is a lot that needs to happen, particularly around the Mexico trade deal, which seems next. Kevin, that is my first high-level question. You guys are always pretty connected in D.C. If we step back, what do you think the industry is asking for at this point? Is it 15% like all the other countries, or is there a case that USMCA compliance vehicles could get something better? I am just curious, super high-level, what do you think the industry is asking for, or really, in your opinion, should be asking for for good policy going forward?

Hey, Kevin Thanks.

Thanks, so much team so.

I appreciate the conservatism I think we all know there's a lot that needs to happen, particularly around Mexico.

Trade deal, which seems next so Kevin that's my sort of my first by level.

You guys are always pretty connected and in DC in.

If we step back what do you think the industry is asking for at this point is it is it sort of 15% and like all the other countries or.

Kevin Clark: Is it sort of 15% like all the other countries, or is there a case that USMCA compliant vehicles could get something better? Just curious, super high level, what you think the industry is asking for, or really, in your opinion, should be asking for for good policy going forward? Yeah. I try to avoid political policy. We can share with you our view. USMCA will definitely stay in place. There'll be some recalibration of certain aspects of USMCA. The administration is focused on bringing high-paying jobs back to the US. Our OEM customers in North America are supportive of that and are working with them to do that. So that will be the principal target. I can't answer, Chris.

Is there a case of U S MCA compliant vehicles could get something better.

Curious Super high level, what you think the industry is asking for or really in European should be asking for.

Good policy going forward.

Kevin Clark: Yeah. I try to avoid political policy. We can share with you our view. USMCA will definitely stay in place. There'll be some recalibration of certain aspects of USMCA. The administration is focused on bringing high-paying jobs back to the US. Our OEM customers in North America are supportive of that and are working with them to do that. So that will be the principal target. I can't answer, Chris.

Kevin Clark: I try to avoid political policy. We can share with you our view. USMCA will definitely stay in place. There will be some recalibration of certain aspects of USMCA. The administration is focused on bringing high-paying jobs back to the U.S. Our OEM customers in North America are supportive of that and are working with them to do that. So that will be the principal target. I cannot answer, Chris. I am not smart enough whether there will be a lever where, to the extent vehicles reach some sort of U.S. content but manufactured in Mexico, whether or not they will be subject to a lower tariff regime or not. I can say for us, I think this is the important thing. And Barron talked about, I talked about in his prepared comments, for U.S. production, 95% of our product comes from Mexico. 99% of that is USMCA compliant.

Yes.

Try to avoid political.

<unk>.

We can we can share with you our view.

U S. MCA will definitely stay in place there'll be some recalibration of certain aspects of U S. MCA.

The administration is focused on bringing high paying jobs back.

To the U S.

<unk>.

Our OEM customers in North America are supportive of that and are working with them than to do that.

So that will be the principal.

Target.

I can't answer Chris I'm, not smart enough whether.

Kevin Clark: I'm not smart enough whether there will be a lever where, to the extent vehicles reach some sort of US content but manufactured in Mexico, whether or not they'll be subject to a lower tariff regime or not. I can say for us, I think this is the important thing, and Varun talked about it. I talked about it in his prepared comments. For US production, 95% of our product comes from Mexico. 99% of that is USMCA compliant. The announcement yesterday with respect to copper tariffs that will not work; we're clear that will not impact wire harnesses. So that won't be an issue for us as we size a potential headwind based on what we know now, and we still don't have the information to give precise estimates, but it's relatively small and something that we can manage.

I'm not smart enough whether there will be a lever where, to the extent vehicles reach some sort of US content but manufactured in Mexico, whether or not they'll be subject to a lower tariff regime or not. I can say for us, I think this is the important thing, and Varun talked about it. I talked about it in his prepared comments. For US production, 95% of our product comes from Mexico. 99% of that is USMCA compliant. The announcement yesterday with respect to copper tariffs that will not work; we're clear that will not impact wire harnesses. So that won't be an issue for us as we size a potential headwind based on what we know now, and we still don't have the information to give precise estimates, but it's relatively small and something that we can manage.

There will be a lever where to the extent.

Vehicles reach some sort of U S content, but manufactured in Mexico, whether or not there'll be subject to a lower lower tariff regime or not I can say for us I think this is the important thing.

And Varian talked about I talked about in his prepared comments.

For U S production, 95% of our product.

<unk> from Mexico.

99% of that.

Is U S MCA compliant.

Kevin Clark: The announcement yesterday with respect to copper tariffs that will not work, we are clear that will not impact wire harnesses. So that will not be an issue for us. As we size a potential headwind based on what we know now, and we still do not have the information to give precise estimates, but it is relatively small and something that we can manage. So from our standpoint, whether the vehicle is manufactured in Mexico or it is manufactured here in the U.S., given how we are positioned and given how we think things will play out, we are in a good place.

The announcement yesterday yesterday with respect to copper tariffs that will not we are clear.

That will not impact wire harnesses.

So that won't be an issue for us.

As we size.

A potential headwind based on what we know now and we still don't have.

Half.

The information.

To give precise estimates, but it's relatively small and something that we can manage.

Kevin Clark: So from our standpoint, whether the vehicle is manufactured in Mexico or it's manufactured here in the US, given how we're positioned and given how we think things will play out, we're in a good place. No, that's great. I appreciate the sensitivity, Kevin. I think it's only interesting because we're now starting to hear public discussions from players like VW on their call talking about almost OEM-specific deals for reshoring. And obviously, you had players like GM, big customers that are already announcing that. So look, it's going to be an exciting August and September on that front. So we'll stay tuned. The last thing, just as that relates to your guidance then, is it fair to say that that -6% is sort of an industry number where we all are assuming a kind of rough Q4 based on tariff-related pricing?

So from our standpoint, whether the vehicle is manufactured in Mexico or it's manufactured here in the US, given how we're positioned and given how we think things will play out, we're in a good place. No, that's great. I appreciate the sensitivity, Kevin. I think it's only interesting because we're now starting to hear public discussions from players like VW on their call talking about almost OEM-specific deals for reshoring. And obviously, you had players like GM, big customers that are already announcing that. So look, it's going to be an exciting August and September on that front. So we'll stay tuned. The last thing, just as that relates to your guidance then, is it fair to say that that -6% is sort of an industry number where we all are assuming a kind of rough Q4 based on tariff-related pricing?

So from our standpoint, whether the vehicles manufactured in Mexico, where it's manufactured here in the U S.

Given how we're positioned and given how we think things will play out.

We're in a good place.

Okay.

Joe Spak: That's great. I appreciate the sensitivity, Kevin. I think it's only interesting because we're now starting to hear public discussions from players like VW on their call talking about almost OEM-specific deals for reshoring. You had players like,

That's great I appreciate the sensitivity Kevin it's only I think it is only interesting because we're now starting to your public discussions and players like VW won on their call talking about almost <unk>.

Oems specific deals for re shoring and obviously you had.

Jess: a chance that customers that are already announcing that. Look, it is going to be an exciting August and September on that front. We will stay tuned. The last thing, just as that relates to your guidance, is it fair to say that that minus 6% is sort of an industry number where we all were assuming a kind of rough Q4 based on tariff-related pricing? Is it okay to paraphrase that your minus 6% almost implies no new deal and that OEMs have to put through price and SAR goes down? Production goes down. Is that a fair case that that is sort of the conservatism here is assuming that we have to have price and negative SAR as a result? If something is better than that, then maybe this will be the upside.

Players like GM big customers that are already announced.

Look it's going to be an exciting August and September on that front. So we'll stay tuned then.

The last thing just as that relates to your guidance. Then is it fair to say that that minus 6% is sort of an industry number where we all were assuming a kind of rough Q4 based on tariff related pricing.

Kevin Clark: So is it okay to paraphrase that your -6% almost implies no new deal and that OEMs have to put through price and SAR goes down, so production goes down? Is that a fair case that that's sort of the conservatism here is assuming that we have to have price and negative SAR as a result? If something's better than that, then maybe there's a little bit of upside. Yeah. I think it's two things. I think it's a year-over-year comp with Q4 last year from a vehicle production standpoint. And then the presumption is that we have weaker consumer demand, whether that's driven by vehicle pricing or other issues that consumers are wrestling with, which obviously affects OEMs and OEM production, right?

Chris McNally: So is it okay to paraphrase that your -6% almost implies no new deal and that OEMs have to put through price and SAR goes down, so production goes down? Is that a fair case that that's sort of the conservatism here is assuming that we have to have price and negative SAR as a result? If something's better than that, then maybe there's a little bit of upside.

Is it okay to paraphrase that that your minus 6% almost implies no new deal and the Oems have to put through pricing solid goes down. So production goes down does that is that a fair case, if that's sort of the.

The conservativism here is assuming that we have to have price and negative Saar as a result.

It's better than that then maybe there's a little bit of upside.

Kevin Clark: Yeah. I think it's two things. I think it's a year-over-year comp with Q4 last year from a vehicle production standpoint. And then the presumption is that we have weaker consumer demand, whether that's driven by vehicle pricing or other issues that consumers are wrestling with, which obviously affects OEMs and OEM production, right?

Kevin Clark: Yeah, I think it's two things. I think it's a year earlier cut with Q4 last year from a vehicle production standpoint. The presumption is that we have weaker consumer demand, whether that's driven by vehicle pricing or other issues that consumers are wrestling with, which obviously affects OEMs and OEM production. So, I, Chris, just taking a step back, we looked at, as we look at the world, our presumption when we gave guidance in February was we were going to be more immediately impacted by tariffs under the presumption they were going to be implemented much sooner. They haven't been. Our reasonably educated view is that there was some pull forward of production by our North American customers. I can't give you an exact number. Now we have that same concern we had back in February for the back half of this year.

Yes, I think its two things I think it's a year over year comp with Q4 last year from a vehicle production standpoint, and then the presumption is that we are weaker consumer demand, whether thats, that's driven by vehicle pricing or.

Or other issues that consumers are wrestling with.

Which obviously affect Oems that OEM production right. So.

Kevin Clark: So, Chris, just taking a step back, as we look at the world, our presumption when we gave guidance in February was we were going to be more immediately impacted by tariffs under the presumption they were going to be implemented much sooner. They haven't been. Our reasonably educated view is that there was some pull forward of production by our North American customers. Can't give you an exact number. And now we have that same concern we had back in February for the back half of this year. If we're wrong and vehicle production is stronger, we'll benefit, just like we did in Q1 and Q2. But sitting here today, we felt the most prudent thing to do was to be a bit more, and I don't know if you want to call it conservative.

So, Chris, just taking a step back, as we look at the world, our presumption when we gave guidance in February was we were going to be more immediately impacted by tariffs under the presumption they were going to be implemented much sooner. They haven't been. Our reasonably educated view is that there was some pull forward of production by our North American customers. Can't give you an exact number. And now we have that same concern we had back in February for the back half of this year. If we're wrong and vehicle production is stronger, we'll benefit, just like we did in Q1 and Q2. But sitting here today, we felt the most prudent thing to do was to be a bit more, and I don't know if you want to call it conservative.

So I, Chris just taking a step back I, just we looked at as we look at the world.

Our presumption when we gave guidance in February was we were going to be more immediately impacted by.

Tariffs under the presumption there going to be implemented much sooner.

They haven't been.

Our.

Our reasonably educated view is that there was some pull forward of production by our North American customers.

And give you an exact number.

And now we have that same concern we had back in February for the back half of this year.

Kevin Clark: If we're wrong and vehicle production is stronger, we'll benefit just like we did in Q1 and Q2. But sitting here today, we felt the most prudent thing to do was to be a bit more, and I don't know if you want to call it conservative, that'll depend upon what plays out, that we should assume that there is an impact on vehicle production in the back half given the implementation of changing trade policies and tariffs.

If we're wrong and vehicle production is stronger will benefit just like we did in Q1 in Q2, but sitting here today.

We felt the most prudent thing to do was to be a bit more I don't know if you want to call. It conservative that'll be dependent depend upon what plays out that we should assume that there is an impact on vehicle production in the back half given the implementation of changing trade policies and tariffs.

Kevin Clark: That'll depend upon what plays out, that we should assume that there is an impact on vehicle production in the back half, given the implementation of changing trade policies and tariffs. Absolutely, Kevin. Makes complete sense. We'll go next to Colin Langan with Wells Fargo. Oh, great. Thanks for taking my questions. If I look at the quarter, your mix in China, I think you were about 10% under market. You were similar and a little better in Q1. When does that start to normalize? Because especially you flagged some new wins with very short lead times. Does that actually start to narrow pretty meaningfully into the second half? And how should we think about it, maybe even into next year? Yeah. I think it depends. Listen, Colin, we were making significant progress over the last two years. We'll continue to make progress.

That'll depend upon what plays out, that we should assume that there is an impact on vehicle production in the back half, given the implementation of changing trade policies and tariffs.

Chris McNally: Absolutely, Kevin. Makes complete sense.

Jess: Absolutely. Kevin, it makes complete sense.

Absolutely Kevin makes complete sense.

Operator: We'll go next to Colin Langan with Wells Fargo.

David Brown: will go next to Colin Langan with Wells Fargo.

We'll go next to Colin Langan with Wells Fargo.

Colin Langan: Oh, great. Thanks for taking my questions. If I look at the quarter, your mix in China, I think you were about 10% under market. You were similar and a little better in Q1. When does that start to normalize? Because especially you flagged some new wins with very short lead times. Does that actually start to narrow pretty meaningfully into the second half? And how should we think about it, maybe even into next year?

Betsy Frank: Oh, great. Thanks for checking my questions. If I look at the quarter, your mix in China, I think you are about 10% under market. You are similar, a little better in Q1. When does that start to normalize? Especially, you flagged some new wins with very short lead time. Does that actually start to narrow pretty meaningfully into the second half? How should we think about it, maybe even into next year?

Oh, great. Thanks for taking my questions.

If I look at the quarter your mix in China, I think you were about 10% under market Youre similar a little better in Q1, when does that start to normalize.

Especially you flagged some new wins with very short lead time does that actually start to narrow pretty meaningfully into the second half and how should we think about it maybe even into next year.

Kevin Clark: Yeah. I think it depends. Listen, Colin, we were making significant progress over the last two years. We'll continue to make progress.

Kevin Clark: Yeah, I think it depends. Listen, Colin, we were making significant progress over the last two years, and we will continue to make progress. Our target was to be at the same mix as industrial production in China at the end of this year, roughly at the end of this year. We were on that track. These programs that I, these vehicle programs or vehicles that I mentioned with respect to Zekr and NIO, obviously have a negative impact and set us back. We will continue to focus on where can we play where we can bring the most value and obviously drive the most profitability. China is a very dynamic market right now, extremely dynamic. It is a critically important market for Aptiv PLC, and we are very focused on it.

Yes, I think it depends listen.

We were making significant progress over the last two years.

Mhm.

And we will continue to make progress.

Kevin Clark: Our target was to be at the same mix as industrial production in China at the end of this year, or roughly at the end of this year. We were on that track. These vehicle programs or vehicles that I mentioned with respect to Zeekr and NIO obviously have a negative impact and set us back. So we'll continue to focus on where can we play where we can bring the most value and obviously drive the most profitability. China is a very dynamic market right now, extremely dynamic. It's a critically important market for Aptiv, and we're very focused on it. But we're very focused on not only revenue growth, but how do we make sure that we get the margin expansion and the return on investment as it relates to that market? We can. We're confident of that. We have a low-cost structure.

Our target was to be at the same mix as industrial production in China at the end of this year, or roughly at the end of this year. We were on that track. These vehicle programs or vehicles that I mentioned with respect to Zeekr and NIO obviously have a negative impact and set us back. So we'll continue to focus on where can we play where we can bring the most value and obviously drive the most profitability. China is a very dynamic market right now, extremely dynamic. It's a critically important market for Aptiv, and we're very focused on it. But we're very focused on not only revenue growth, but how do we make sure that we get the margin expansion and the return on investment as it relates to that market? We can. We're confident of that. We have a low-cost structure.

Our target was to be at.

The same mix as an industrial production in China at the end of this year are roughly at the end of this year.

We were on.

That track.

These programs that these vehicle programs or vehicles that I mentioned with respect to.

Two secret Neo obviously have a negative impact incentives back.

So we'll continue to focus on.

Where can we play where.

We can bring the most value and obviously drive the most profitability.

China is a very dynamic market right now extremely dynamic.

It is a critically important market for App and we're very focused on it.

Kevin Clark: We are very focused on not only revenue growth, but how do we make sure that we get the margin expansion and the return on investment as it relates to that market? We can. We are confident of that. We have a low-cost structure. We continue to aggressively reduce that cost structure by rotating engineering activities, by leveraging global platforms, by reducing our sourcing costs as it relates to our supply chain. The team is doing a great job. It is important that we be focused on doing business with the right customers on the right platforms and ensuring that we do not end up in minimizing the risk of being in a situation like we are talking about to you today with respect to a couple of customers on a few platforms that they have significantly reduced volume to having an impact on us.

But we're very focused on not only revenue growth, but how do we make sure that we get the margin expansion and the return on investment as it relates to that market and we can we're confident of that and and we have a low cost structure, we continue to aggressively reduce that cost structure.

Kevin Clark: We continue to aggressively reduce that cost structure by rotating engineering activities, by leveraging global platforms, and by reducing our sourcing costs as it relates to our supply chain. So the team's doing a great job. But it's important that we be focused on doing business with the right customers on the right platforms and ensuring that we don't end up minimizing the risk of being in a situation like we're talking about to you today with respect to a couple of customers on a few platforms that they've significantly reduced volumes, having an impact on us. So we're working our way towards that, but our real focus is how do we grow earnings both in China as well as on an aggregate Aptiv basis. Got it. Makes sense. You also mentioned that the guide doesn't include the copper tariffs, which I guess makes sense.

We continue to aggressively reduce that cost structure by rotating engineering activities, by leveraging global platforms, and by reducing our sourcing costs as it relates to our supply chain. So the team's doing a great job. But it's important that we be focused on doing business with the right customers on the right platforms and ensuring that we don't end up minimizing the risk of being in a situation like we're talking about to you today with respect to a couple of customers on a few platforms that they've significantly reduced volumes, having an impact on us. So we're working our way towards that, but our real focus is how do we grow earnings both in China as well as on an aggregate Aptiv basis.

By rotating engineering activities by leveraging global platforms.

By reducing our <unk>.

Sourcing costs.

As it relates to our supply chain. So the team's doing a great job, but it's important that.

We'd be focused on doing business with the right customers.

On the right platforms.

And ensuring that we don't up and up and minimizing the risk of being in a situation like we're talking about today with respect to a couple of customers on a few platforms that they have.

Significantly reduce volumes, having an impact on us.

Kevin Clark: We are working our way towards that, but our real focus is how do we grow earnings both in China as well as on an aggregate Aptiv PLC basis.

So we're working our way towards that but our real focus is how do we grow earnings both in China as well as in an aggregate active basis.

Colin Langan: Got it. Makes sense. You also mentioned that the guide doesn't include the copper tariffs, which I guess makes sense. But anyway to frame that in terms of, I believe most of your contracts have pass-through provisions. Is there a risk to numbers from a dollar perspective, or is this more of a margin dilution risk?

Betsy Frank: Got it. Makes sense. You also mentioned that the guide doesn't include the copper tariffs, which I guess makes sense. But any way to frame that in terms of, I believe most of your contracts have, you know, pass through provisions. Is there a risk to numbers or from a dollar perspective, or is this more of a margin dilution risk?

Got it makes sense.

He also mentioned that guide doesn't include the copper and tariffs, which I guess makes sense.

Kevin Clark: But anyway to frame that in terms of, I believe most of your contracts have pass-through provisions. Is there a risk to numbers from a dollar perspective, or is this more of a margin dilution risk? No. So this is derivative. So it's non-232. But it's manageable based on our analysis. And we don't have all the specifics, but Varun and I can confidently tell you this is something we can manage through from a supply chain standpoint. And to the extent we're not able to offset all of it, it's something that we've been having conversations with our customers regarding, and we'll be able to push it through. Varun, you should. No, I think that's right, Kevin. Got it. All right. Thanks for taking my questions. We'll go next to Tom Narayan with RBC. Hey, thanks for taking my question.

But.

Any way to frame that in terms of I believe most of your contracts have pass through provisions is there a risk to.

<unk> or from a dollar perspective or is this more of a margin dilution risk.

Kevin Clark: No. So this is derivative. So it's non-232. But it's manageable based on our analysis. And we don't have all the specifics, but Varun and I can confidently tell you this is something we can manage through from a supply chain standpoint. And to the extent we're not able to offset all of it, it's something that we've been having conversations with our customers regarding, and we'll be able to push it through. Varun, you should.

Kevin Clark: No, so this is not, this is derivative. So it's non-232, but it's manageable. Based on our analysis, and we don't have all the specifics, Varun Laroyia and I can confidently tell you this is something we can manage through from a supply chain standpoint. To the extent we're not able to offset all of it, it's something that we've been having conversations with our customers regarding, and we'll be able to push it through. I'm very interested.

No. So this is not this.

Derivatives, so its $9 32.

<unk>.

But it's manageable they based on our analysis and we don't have all the specifics, but we can Vernon I can confidently tell you. This is something we can manage through from a supply chain standpoint and to the extent, we're not able to offset all of it.

It's something that we've been having conversations with our customers regarding and we'll be able to push it through variation.

Betsy Frank: No, I think that's right. Got it. All right, thanks for taking my questions.

Varun Laroyia: No, I think that's right, Kevin.

Colin Langan: Got it. All right. Thanks for taking my questions.

Right.

Got it alright, thank you taking my questions.

Operator: We'll go next to Tom Narayan with RBC.

David Brown: We'll go next to Tom Narayan with RBC.

We'll go next to Tom Narayan with RBC.

Operator: Hey, thanks for taking my question. I know you guys have talked a lot about China. Just one more. So on that order booked, 85% to domestics. Just curious if we could get a little more detail on that. I know one of the big catalysts was potentially the fact that these domestic OEMs have to expand or want to expand outside of China, particularly Europe, and that benefits you guys. Just curious as to commentary in that regard. Is that a big factor that was driving the domestics that you were winning, or is it just kind of across the board?

Kevin Clark: Hey, thanks for taking my question. I know you guys have talked a lot about China. Just one more. On that order booked 85% to domestics, just curious if we could get a little more detail on that. I know one of the big catalysts was potentially, the fact that these domestic OEMs have to expand or want to expand outside of China, particularly Europe, and that benefits you guys. Just curious as to commentary in that regard. Is that a big factor that was driving the domestics that you were winning, or is it just kind of across the board?

Hey, Thanks for taking my question.

Kevin Clark: I know you guys have talked a lot about China. Just one more. So on that order booked, 85% to domestics. Just curious if we could get a little more detail on that. I know one of the big catalysts was potentially the fact that these domestic OEMs have to expand or want to expand outside of China, particularly Europe, and that benefits you guys. Just curious as to commentary in that regard. Is that a big factor that was driving the domestics that you were winning, or is it just kind of across the board? No, Tom, it's a great question. It's across the board. It's across the board.

I know you guys have talked a lot about China, just one more.

So on that order book for 85% to Domestics, just curious if we could.

You get a little more detail on that.

I know one of the big catalysts was potentially the fact that these domestic Oems to expand or want to expand outside of China, particularly Europe that benefits you guys just curious as to.

Commentary in that regard is that is that a big factor that was driving the domestics that you're winning or is it just kind of across the board.

Kevin Clark: No, Tom, it's a great question. It's across the board. It's across the board. So we've been winning significant business, for example, with BYD over the last in our ECG business over the last couple of years, in our EDS business over the last 12 months with opportunities in ASUX that we're working on now. Our focus is on strategic programs in China, vehicle programs, as well as, I'd say, an additional focus on where are those OEMs taking vehicles offshore, whether that be through export or through production in Europe. There are a few of them that were spending a lot of time on their European or South American supply chain as they move production out and try to ramp up. So we're in front of those particular vehicle programs but making progress.

Kevin Clark: No, Tom, it's a great question. It's across the board. It's across the board. We've been winning significant business, for example, with BYD over the last, in our ECG business over the last couple of years, in our EDF business over the last 12 months with opportunities in Advanced Safety and User Experience that we're working on now. Our focus is on strategic programs in China, vehicle programs, as well as I'd say an additional focus on where are those OEMs taking vehicles, you know, offshore, whether that be through export or through production in Europe. There are a few of them that we're spending a lot of time on their European or South American supply chain as they move production out and try to ramp up. We're in front of those particular vehicle programs, but making progress.

No it's.

It's a great question, it's across the board it's across the board so.

Kevin Clark: So we've been winning significant business, for example, with BYD over the last in our ECG business over the last couple of years, in our EDS business over the last 12 months with opportunities in ASUX that we're working on now. Our focus is on strategic programs in China, vehicle programs, as well as, I'd say, an additional focus on where are those OEMs taking vehicles offshore, whether that be through export or through production in Europe. There are a few of them that were spending a lot of time on their European or South American supply chain as they move production out and try to ramp up. So we're in front of those particular vehicle programs but making progress.

We've been winning significant business for example, with BYD over the last in our ACG business over the last couple of years.

In our EES business over the last 12 months.

With opportunities in <unk> that we're working on now.

Our focus is on.

Strategic programs in China.

Vehicle programs as well as I'd say aye.

An additional focus on where those Oems taking vehicles.

Offshore whether that be through export or through production in Europe.

There are a few of them that we're spending a lot of time on there.

European or South American supply chain as they move production.

Out and try to ramp up so we're in front of those particular vehicle programs.

But making progress so I would say, it's a bit of a pause.

Kevin Clark: So I would say it's a bit of a two-pronged, but we feel like we can bring the most value, quite frankly, or we can bring incremental value for those that need support outside of the China market. Got it. And my follow-up, this is kind of more a high-level question. In your prepared comments, there were a lot of big wins, it sounded like. And I was just curious as to those wins, are they mostly on the ADAS side? Are they mostly like, is there a characteristic of where these wins are more than others? I've actually forgotten my question. But I'm just curious as to where, yeah. If you could just comment on where those wins are specifically. Yeah. So our ADAS awards are in North America, Europe, and China.

So I would say it's a bit of a two-pronged, but we feel like we can bring the most value, quite frankly, or we can bring incremental value for those that need support outside of the China market.

Kevin Clark: I would say it's a bit of a two-pronged, but we feel like we can bring the most value, quite frankly, or we can bring incremental value for those that need support outside of the China market.

Two prong, but we feel like we can bring the most value quite frankly, or we can bring incremental value.

For those that need support outside of the China market.

Tom Narayan: Got it. And my follow-up, this is kind of more a high-level question. In your prepared comments, there were a lot of big wins, it sounded like. And I was just curious as to those wins, are they mostly on the ADAS side? Are they mostly like, is there a characteristic of where these wins are more than others? I've actually forgotten my question. But I'm just curious as to where, yeah. If you could just comment on where those wins are specifically. Yeah. So our ADAS awards are in North America, Europe, and China.

Kevin Clark: Got it. My follow-up, this is kind of more a high-level question. In your prepared comments, there were a lot of big wins, it sounded like. I was just curious as to those wins, are they mostly on the ADAS side? Are they mostly, is there a characteristic of where these wins are more than others? I have actually forgotten my question. I am just curious as to where, if you could just comment on where those wins are specifically.

Got it.

And my follow up just kind of more of a high level question on your prepared comments there was a lot of big wins at <unk> it sounded like.

And I was just curious as to.

Those wins are they are.

Are they mostly like.

On the Adas side.

Asleep like.

Or is there a characteristic of where these wins are more than others.

Yeah.

I'd actually forgotten my question, but I was just curious as to if you.

You could just comment on where those wins are specifically.

Kevin Clark: So our ADAS awards are in North America, Europe, and China. We would tell you just given cost pressure that our OEM customers are under tariff and other, they're very focused on, I would say there's incremental focus and willingness to look at full system solutions that save them money. We talked about the award to Leap Motor, the award from Leap Motor, rather, for their European vehicles that include locally sourced China-based SOCs, Strategy and Vision Solution, which is our reference vision solution for our Gen 6 ADAS platform, and then our Gen 6 ADAS platform. So very cost-effective. Similarly, with the North American OEM, a different vision solution, but it's an enhancement of our existing Gen 6 ADAS solution, adding more features, more capability, more scalability with significantly more focus on the trade-off between performance and cost of performance.

Yes so.

Our Adas awards are in North America, Europe and China.

Kevin Clark: We would tell you, just given cost pressure that our OEM customers are under, tariff and other, they're very focused on. I would say there's incremental focus and willingness to look at full-system solutions that save them money. We talked about the award to Leapmotor, the award from Leapmotor, rather, for their European vehicles that include locally sourced China-based SOCs, StradVision solution, which is our reference vision solution for our Gen 6 ADAS platform, and then our Gen 6 ADAS platform. So very cost-effective. Similarly, with the North American OEM, a different vision solution, but it's an enhancement of our existing Gen 6 ADAS solution, adding more features, more capability, more scalability with significantly more focus on the trade-off between performance and cost of performance. I think I remembered what I was going to ask. I think I remembered what I was going to ask. Sorry. Yeah.

We would tell you just given cost pressure at our OEM customers are under tariffs and other.

They are very focused on.

I would say theres incremental focus and willingness to look at full system solutions that save them money.

We talked about the award.

To leap motor.

Work from leap motor rather for their European vehicles.

That include locally sourced.

China <unk>.

<unk> envision solution.

Which is our reference vision solution for Gen. Six eight <unk> platform and then our Gen. Six eight as platform so very cost effective.

Similarly, with with the North American OEM, a different vision solution, but it's an enhancement of our existing gen. Six Adas solution, adding more features more capability more scalability with cigna.

Significantly more focus on the tradeoff between performance and cost performance.

Tom Narayan: I think I remembered what I was going to ask. I think I remembered what I was going to ask. Sorry. Yeah. So this is something we've been hearing from a lot of the OEMs: the larger OEMs feel like on ADAS that there's a lot of, "I want to insource." And maybe some of the smaller ones, there's a major propensity to outsource more. Just curious, is that what you guys are seeing? The larger OEMs have an inclination to perhaps want to take kind of piece parts of your ADAS portfolio as opposed to the entire suite? Or is that not the case that they're winning kind of across the board? You want the larger OEMs.

So remember.

Kevin Clark: Yeah.

Yes.

Kevin Clark: Pardon me?

Kevin Clark: I think I remember what I was going to ask. Sorry. So this is something we have been hearing from a lot of the OEMs. The larger OEMs feel like on ADAS that there is a lot of, "I want to insource." Maybe some of the smaller ones, there is a propensity to outsource more. Just curious, is that what you guys are seeing? The larger OEMs have an inclination to perhaps want to take piece parts of your ADAS portfolio as opposed to the entire suite, or is that not the case that you are winning across the board?

I think I remember it was Kenneth.

I remember, what I was going to ask sorry.

Kevin Clark: So this is something we've been hearing from a lot of the OEMs: the larger OEMs feel like on ADAS that there's a lot of, "I want to insource." And maybe some of the smaller ones, there's a major propensity to outsource more. Just curious, is that what you guys are seeing? The larger OEMs have an inclination to perhaps want to take kind of piece parts of your ADAS portfolio as opposed to the entire suite? Or is that not the case that they're winning kind of across the board? You want the larger OEMs. Yeah. We would tell you now we're seeing from OEMs less desire to do things internally. Now, there may be some things that with particular OEMs where it might be a feature or some features within an ADAS stack, but that we're going to do it all ourselves.

Yes. So this is something we've been hearing from a lot of the Oems is.

The larger Oems feel like on a test that theres a lot of I want to in source.

And maybe some of the smaller ones there is a.

Maybe a propensity to outsource more and just curious like is that what you guys are seeing.

The larger Oems habit I.

Inclination to perhaps want to take kind of piece parts of your of your <unk>.

Portfolio as opposed to the entire suite or is that not the case. So they are winning kind of what kind of support we linked to large and yes, we would.

Kevin Clark: We would tell you now, we are seeing from OEMs less desire to do things internally. Now, there may be some things that, with particular OEMs, where it might be a feature or some features within an ADAS stack, but that we are going to do it all ourselves. Listen, you are familiar with the OEMs that have tried doing that, have spent money doing it, and have not been overly successful. We would say that trend has reversed course. We would say, though, all of our OEMs are looking for open architected solutions where they have flexibility. That is important, that they are scalable so that they can put higher performing, high-cost systems on a more luxurious vehicle and lower-cost systems on entry vehicles. To the extent you can do that with a single platform, it is less engineering costs for them.

Kevin Clark: Yeah. We would tell you now we're seeing from OEMs less desire to do things internally. Now, there may be some things that with particular OEMs where it might be a feature or some features within an ADAS stack, but that we're going to do it all ourselves.

We would tell you now.

We're seeing from Oems.

Less desire.

Do things internally.

Now there may be some things that.

With particular Oems, where it might be.

A feature or some features within an Adas stack.

But that we're going to do it all.

Ourselves and listen Youre familiar with the Oems.

Kevin Clark: And listen, you're familiar with the OEMs that have tried doing that, have spent money doing it, and have not been overly successful. We would say that trend is reversed course. We would say, though, all of our OEMs are looking for open architected solutions where they have flexibility, that that's important, that they're scalable so that they can put higher-performing, high-cost systems on a more luxurious vehicle and lower-cost systems on entry vehicles. And to the extent you can do that with a single platform, it's less engineering cost for them. So all of them are looking for that sort of approach to things. So in a strange way, all the cost pressure going on in the industry is actually helpful to our business model. But again, we're willing to provide the full-system solution or part of the solution, depending upon what the customer is looking for. Yeah. Thanks.

And listen, you're familiar with the OEMs that have tried doing that, have spent money doing it, and have not been overly successful. We would say that trend is reversed course. We would say, though, all of our OEMs are looking for open architected solutions where they have flexibility, that that's important, that they're scalable so that they can put higher-performing, high-cost systems on a more luxurious vehicle and lower-cost systems on entry vehicles. And to the extent you can do that with a single platform, it's less engineering cost for them. So all of them are looking for that sort of approach to things. So in a strange way, all the cost pressure going on in the industry is actually helpful to our business model. But again, we're willing to provide the full-system solution or part of the solution, depending upon what the customer is looking for.

By doing that is spent money doing it and have not been overly successful we would say that trend has reversed course.

We will we would say though.

All of our Oems are looking for open Architected solutions, where they have flexibility that thats important that they're scalable so that they can put higher performing high cost systems on a more luxurious vehicle.

Lower cost systems on entry vehicles and to the extent you can do that with a single platform.

Less engineering cost for them. So all of them are looking for for that sort of.

Kevin Clark: All of them are looking for that sort of approach to things. In a strange way, all of the cost pressure going on in the industry is actually helpful to our business model. Again, we are willing to provide the full system solution or part of the solution depending upon what the customer is looking for.

Approach.

Things so in a strange way all of the cost pressure going on in the industry.

Is actually helpful to our business model, but again.

We're willing to provide the full system solution or part of the solution depending upon what the customers looking for.

Tom Narayan: Yeah. Thanks.

Kevin Clark: Got it. Thanks.

Got it thanks.

Kevin Clark: That will conclude today's question-and-answer session. I will now turn the call back to Mr. Kevin Clark for any additional or closing remarks. Thank you, operator. Thanks, everybody, for spending time with us this morning. We really appreciate your questions. Have a great rest of the day. Thanks. Thank you. Ladies and gentlemen, that will conclude the Aptiv Q2 2025 earnings call. We thank you for your participation. You may disconnect at this time and have a great day.

David Brown: That will conclude today's question and answer session. I will now turn the call back to Mr. Kevin Clark for any additional or closing remarks.

Operator: That will conclude today's question-and-answer session. I will now turn the call back to Mr. Kevin Clark for any additional or closing remarks.

And that will conclude today's question and answer session I will now turn the call back to Mr. Kevin Clark for any additional or closing remark.

Kevin Clark: Thank you, operator. Thanks, everybody, for spending time with us this morning. We really appreciate your questions. Have a great rest of the day. Thanks.

Thank you operator, and thanks, everybody for.

Spending time with US this morning, we really appreciate.

Your questions have a great rest of the day. Thanks.

Operator: Thank you. Ladies and gentlemen, that will conclude the Aptiv Q2 2025 earnings call. We thank you for your participation. You may disconnect at this time and have a great day.

David Brown: Thank you. Ladies and gentlemen, that will conclude the Aptiv Q2 2025 earnings call. We thank you for your participation. You may disconnect at this time and have a great day.

Thank you, ladies and gentlemen that will conclude the <unk> Q2, 2025 earnings call. We thank you for your participation.

May disconnect at this time and have a great day.

Okay.

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Q2 2025 Aptiv PLC Earnings Call

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