BorgWarner Inc (BWA) Q1 2025 Earnings Report

BorgWarner delivered a solid start to 2025 in QQ1, with reported revenue of $3.515 billion and organic growth of approximately 3.7% driven by a 47% surge in light-vehicle eProduct sales. The company achieved an adjusted operating margin of 10.0% and highlighted ongoing cost controls, contributing to robust profitability despite a softer market production backdrop. Management reaffirmed its strategy to exit non-core businesses and streamline the portfolio: exiting the charging business and consolidating North American battery-system capacity. These actions are expected to reduce annual operating losses by roughly $30 million and generate meaningful cost savings (about $20 million per year by 2026) as capacity consolidates at Seneca, SC, while raising near-term earnings leverage.

Management also outlined a constructive near- to mid-term growth trajectory anchored by a slate of product awards across combustion, hybrid, and BEV platforms (including a Hybrid eMotor award, a High-Voltage Coolant Heater award, EGR program extensions, and two dual-clutch transmission awards in China). The 2025 outlook reflects tariff headwinds and the charging exit, with total 2025 sales guidance raised to $13.6–$14.2 billion, adjusted operating margin guidance of 9.6%–10.2%, and adjusted earnings per share (EPS) of $4.00–$4.45. Free cash flow is targeted at $650–$750 million, with the midpoint of the range unchanged at $700 million in the face of tariff recoveries deemed to be up to 1.6% of sales. The company remains disciplined on M&A, buybacks, and capital allocation, signaling a balanced approach to shareholder value creation amid industry volatility.