APTV - Earnings call transcript Q3 2024

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, and welcome to the Aptiv Q3 2024 Earnings Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Jane Wu, Vice President of Investor Relations and Corporate Development. Please go ahead.

Jane Wu

Thank you, Jess. you Aptiv's thank Earnings Quarter and Call. Conference morning, for Third joining XXXX Good and along portion related presentation, release press The tables, found at the website can with on Investor our Relations of aptiv.com. be slide the review other items and operations Aptiv. and amortization, continuing special the our exclude address Today's of of restructuring financials we'll

press the as our XXXX earnings outlook reconciliations and measures non-GAAP and as The release. the for our presentation included well at back between GAAP third of slide quarter results are the

call, of and today's reasons current materially forward-looking our be information that certain filings. During SEC in for we providing future Form will reflects different other XX-K that cite Aptiv's may view we performance, and financial be

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

Kevin P. Clark

and morning. joining thanks, for us everyone, this Jane, Thanks,

X. Slide on begin Let's

JVs During launches, the than weakness European-based were busy production quarter, DX the by record China. continued in on America, schedules and with in in multinational OEM offset select schedules production weakness from which further in more in from and vehicle Europe year-to-date North we number of large with OEMs a especially were program executing a the global

environment, reflecting record an for experienced quarter headwinds more our strong line. margin earnings towards all-time a and dynamic performance. Despite product continued result, revenues weighted operating as we per anticipated quarterly well third As than electrical previously as delivered quarter share, record income X% market more our third operating as declined distribution we the

points a share of year, well basis the count. restructuring basis and operating XXX EBITDA respectively, from increased EPS versus lower benefiting emotional XXX as as and points, completion prior XX% and margins strong expanded and operating performance

X. Slide to Moving

weaker that operating XXXX by an reduction later. backdrop by and updated slowdown will industry vehicle impacted our incremental we're Although we're production further overall reflect updating year-to-date adoption our outlook our customer strong Joe includes cover mix. an encouraged global in EV execution, a outlook to our in

enable cost, prioritizing confident manufacturing remain end revenue towards including continue. once of And labor future we reaccelerate and actions that indirect built, customer the in However, which proactively software-defined both growth we've at the the of our performance electrified will solutions, additional and platforms, regions. our our trends investments improvement customer diversifying dynamics lower direct and flexible reducing consolidating a a business long-term meantime, higher productized profit as each model industry implemented and will footprint open our on we've stabilized. across exposure, market resilient In have and result

remain that We to our customers us technologies, deliver with long-term of shareholders. cost portfolio positions and to coupled to confident our advanced structure, our value our optimized

X. Slide to Moving

vehicle, safety Signal across quarter. totaled bookings defense aerospace including year-to-date, new new the active bookings under $XX industrial just program bookings in awards, in strong totaled During year-to-date, the to by of total booked Experience and we $XX bringing just billion. business the Safety $X.X $X.X and and Power automotive, the Solutions, markets. continued new end third billion business awards quarter, commercial billion under momentum and User Advanced year-to-date billion driven

which of program cancellations, bookings is updated losses our do we've continues some awards, seen or our in program in business of not $XX our our to expectations represent delays reflected business. business customer lines shifting time new to for While but These target XXXX do expand, delays pipeline new impact opportunities timing causing across billion. related bookings,

in customers the win to full-system portfolio long-term cost-effective market continues support scale of new solutions to us global our position near- dynamics. both industry-leading navigating business and and Our and

Experience during with X% underscoring benefits Turning record Advanced on X. The and product segment and safety Revenues quarter, revenues. reflecting across offset earnings portfolio our Slide quarter, our declined the in vehicle productivity achieved and to user User a the the mid-teens, associated billion over $X.X segment increased strength to Safety major regions. revenues growth production decline by margin in our initiatives. of our partially experience Active

record engineering a margins representing productivity from and $XXX totaled benefits million, manufacturing income initiatives. reflecting of XX.X%, Operating

increase vendor our We continue chain partnerships strategic further lower build and both and supply resiliency to supplier base localize to cost.

alternative in perception utilizes This that solution SoC underscoring and and how that China-based abstracted Geely radar ADAS we're provides Maxieye, provided local solution of include a platform. by ADAS the our investment with our vision with a Axera open this solution supplier of an benefits the provided the award Gen Recent architecture in for by software vision market. China-based the by India, camera commercial China new X a is during OEM our demonstrated a highlights smart Maxieye a in local quarter, a leveraging

extension performance, content our American-based additional increased be of vehicle reflection existing program will ADAS as strong includes with of and the a North And a programs. which, large an across OEM, launched

first we multiple new XD capability. vehicle incorporates base-level forward-facing also launched programs which Geely, quarter, including Gen radar, our solution X for the radar the our During ADAS industry's with

X+. controller, to ADAS supplying a solution followed year experience of utilize program scalability. launches early of by and from is that capable significant A OEM multiple which compute consolidates for next higher large a single Hinge's cockpit integrated levels our be ECUs performance platform, user additional which scalable program that will SUV multinational Our Level vehicle up into fully

first successful engagement we're This the mission-critical Linux further for the of continuum. expansion the computer expands the ecosystem and of and enables Linux workloads, to edge data-intensive vision. and AI, of been deployment solution cloud drive eLxr including River's the open eLxr Customer Pro, solution River's for planning source And promising, and Wind ML enterprise-grade lastly, has launch growth. Wind portfolio

our which on hardware. solutions abstracted at recently roundtable We This modular the competitive tool cost. into ADAS and very life solution slide. ADAS approach foundation native to The next delivers is that held running an technology and software scalable services-based enables OEM deeper architecture dive accelerate deployment chain the cloud to streamline to of management. development, our cycle high-performing Moving optimize customers a investor software stack, our support

Our much solution efficiently to from full and enabling driving, even scales cost. system compliance, flexibility autonomy, up a X Level hands-free at urban greater lower

during segment and X%, revenues XX% Turning X. respectively. to distribution reflecting and segment engineered and Solutions in lines Revenues declining Slide Signal Power X% in quarter, of down our were system our electrical product the component the on

$XXX select by impacted and revenues aerospace initiatives. America end customer from were revenues continued representing reflecting margin operating OEMs to performance particularly Operating Europe, income related in offset XX.X%, volumes impact traction Engineered strong Component North while by EDS savings schedule industrials. in the of in a benefited nonautomotive growth from of partially including million, totaled lower and reductions, markets, production

billion architecture with manufacturer Signal awards X American global electrical Solutions approximately awards booked in major high-voltage market customer and across the Power and including Chinese OEMs in Conquest North program low- $X.X new for with solutions. extensions local EV and largest the quarter, the

several across OEM also major EV and of we a including as programs North portfolios vehicle for Chinese America launches our OEMs as year-to-date, well As the for launches the both number in mentioned, Korean Europe. in OEM, program record delivered and

X. Slide to Turning

content, recent for quarter, Looking like a few of to executive engage opportunity are presenting our Aptiv to a tailored hundreds opportunities and which great technology these solutions engineering, regions of display our highlight live and resulting demonstrations lead a commercial portfolio. us times, across our across of entire events, with broad purchasing range showcases, I'd beyond of hosted in customers, the markets. customers and technical each the and At cost-effective teams new

team Changan Great returned numerous OEMs, from created Wall Motor. the including chain. as road across and technology broader host fast-growing our engage in on in the booth vehicles and the BYD, Volkswagen we opportunity China, partners IZB and as with and the just And with In executive our hosted supply Group's well to Wolfsburg, customers local showcases we leadership

markets. In also opportunities automotive addition other the we're to in market, pursuing

spark many interest commercial from Our presence Transportation vehicle major well customers. received was at EI and

to As with leading are evolve, partner important of one a these levers and as the increasingly industry solidify position we are customers. choice further landscapes technology use showcases of our

Slide XX. to Moving

customers hardware and over Vegas software this roads partner Las that, Vegas, to consistent I'd future. functional newest software-defined, with to Joe. Joe, I years, on to cloud-native We'll our like Show a everyone over January. call the of be of now Electronics it that we'll remind showcasing turn in the build unveiling demonstrating and to we intersection Consumer the coming fully prior solutions of I Las innovations and turn vehicles the how our electrified Before with With will be integrated at can the at vehicles

Joseph Massaro

in strong improvements the underlying to the with Starting revenues, everyone. X% morning, we the compared quarter Slide good continue as vehicle down Tight across delivered Revenue quarter and global billion, growth lower performance Aptiv operating XX. production. down to Kevin, Thanks, X% $X.X or third was on earnings business. drive

the vehicle well growth certain large vehicle North customers the including in a in did by at impacted lower OEM expectations. cases, with production production quarter, Consistent as European In second our with reductions presence revenue select a customers China. was as American exceed prior multinational

product scheduled slowdown others. as I more lines vehicle production these in will continued in well discuss electric as as than key the certain shortly, And detail reductions impacted more

Improved operating cost operating $XXX management end the million across XXXX and increased Third quarter income proactive and steps respectively. performance current points basis EBITDA prior XXX of both segments, took adjusted margin over year expenses, reduction operating year. with million, by the and we $XXX at the combined were of

flow-through earlier which commodities $X.XX as prior year. We earnings increase of were record share and the a the delivered the repurchases headwind the this year, in and restructuring XX% benefits of as an earnings share the of reflects from quarterly of motional per venture joint FX $XX the well million and of quarter.

flow and capital well market finally, repaying during X in the the $XXX also were expenditures Operating China focused technology a company $XXX million And including million we quarter, $XX vision on providers cash million. as $XXX of as invested totaled million debt.

billion by and X%, impacted negatively impact production XX. Slide Revenue lines. net key to the the vehicle price quarter, offset commodities Net product was FX $X.X the positive in by Moving lower of in secular in minimal. quarter were down growth in was

X%. local production, growth safety, down in North lower China by European was by was down and Revenue of was to across total offset offset America revenues. safety. driven represented with in China, X% in sales And XX% growth lower China production active Europe America the driven generally by performance volumes. double-digit by approximately partially both active performance XX% and OEMs and grew X% in North quarter consistent regions,

across growth of XX% or volumes safety by all Slide product with program down quarter revenues vehicle on more line or to OEMs, X% above active Within Growth XX% the the production The product were X% multinational above vehicle safety we line. XX. than regions. Chinese Moving local segment, global in our XX% grew year-over-year ASUX China production. several in as was with active ramped impact new in launches offsetting lower the

above Smart a X% software launches. new X% Chinese user in vehicle lower and offset market, grew production. quarter, which product growth a multinational well or XX% benefiting of as the was the by from compute in experience, down was legacy quarter program lines as This reflecting vehicle down wind program

resources the in and in Segment-adjusted focus and resulting rotation containment expectations performance $XXX on operating record best cost from engineering and improvement year-over-year our operating and including continued the respectively, margin with quarter of XX.X%, a income cost consistent locations. our improvement were significant to initiatives, million

the billion, Power production. Solutions, EV vehicle Turning quarters. X% a in was or on decrease to the Within decrease X% Power production volumes significant past in have XX. quarter and headwinds of vehicle Signal Revenue impacted Slide over growth below Signal a and and $X.X several

been electrical concentrated systems this line. impact However, the has much distribution negative product within more

including North whose largest was or market, and impacted Distribution production America. over down global was was impact volumes, EV lower in by which of vehicle the down lower the Distribution also at down XX% XX% XX%. select OEMs, quarter was the in production down Electrical by lines quarter product in one QX Electrical X% customers, negatively The below the of including XX%

offset The by the quarter Engineered was product X% production aerospace growth lines. Components as at industrial product select in interconnect lower line our automotive was partially down X% and in customers

FX improved or through commodities. the well was impact as income offset million on year-over-year net operating reflecting adjusted by lower as price not XX.X%, significant. partially Segment flow revenues, operating performance and was The $XXX

XX. Moving to Slide

full Turning outlook. year to our

year, As we we vehicle at -- the continue pressure of schedules. customer continued on as look production remainder and we the global expect

will costs we actions have that and to performance continue and performance the improve flow confident taken remain we to cash drive However, reduce operating strong generation.

$XX.X the down revenues adjusted representing $XX.X to midpoint of billion, outlook growth revenue $XX.XX from in X%. Our billion, prior of of includes range billion the

our are down We vehicle assuming down prior in be outlook of will X% versus production XXXX global X%.

is production prior X% up at $X.XX North Europe and billion year. and the expected X% respectively. margin Operating vehicle America China reflecting X%, basis while and operating of midpoint be were over margin to expansion XX.X% points of of income XXX down

We also to $X.XX EPS at guide midpoint, lower decrease are earnings. $X.XX a revising the our prior estimates from driven of by

to We our at current capital capital from improvements year prior in market are operating we XX% conditions. cash working forecast drive and holding billion, continue up $X.XX spending the adjust as for

allocation. capital continued to performance would Before as the strong to it Kevin, call back handing flow upon touch to and our relates cash I generation like

an X% year. the business, to inorganically, X software $X.X return including capital generated have and partners our financial in both investments to flow, Aptiv increase organically has during we in increase Year-to-date, significantly This of to allowed policy. cash maintaining shareholders continue in last operating quarter, over while the invest our billion vision almost of

Our structure us with the cost for income our that, enables And we capital operating performance well-balanced a us shareholder approach on drive call value. to that to maintain back to relentless more allowing convert cash, Kevin allocation remarks. helps to turn I'll optimizing believe his closing strong focus and to

Kevin P. Clark

EPS. third some the our forecast margins of headwinds before line balance earnings quarter financial final during for despite Slide and make record and the well production, positioned opening near-term And questions. I'll for XXXX. to year vehicle into quarter we're deliver reflects earnings, on expansion and Joe. growth while outlook revised Thanks, a revenue remarks global executed XX strong updated margin well with continued the We in third up the

portfolio flexibility our And customers our the dynamic We've well actively greater staked better solutions strong performance results combined with resulting even Operator, at our for deliver with we've lower and structure, shareholder out, cost open model we're a and that environment. ensures business strong position provide to line and cost. the let's shaped this competitive questions. to positioned returns industry-leading in financial

Operator

with will McNally Instructions] Evercore. [Operator now first from our take question We Chris

Chris McNally

the $X.X roughly only Look, in you've reduction, is decrementals, the you quick operating environment extremely revenue is our the the guide are year, clearly, EBIT. had as tough, almost calc of Joe, mean I from but related a billion managing. million mentioned, but beginning $XXX

that's XX% almost So decrementals.

falls, You decrementals your obviously when revenue much are higher. typically

XX% half, So is think my how think EBIT from in question to about a the walk this period I low of XXXX, margin. second

into as Second half, I reimbursement. know, ex starting basis, margin R&D to the But maybe XX.X%, about XX% we better know that I don't underlying forward I'm a think for little momentum bit recurring you And that's -- Can a carried point just XX.X% much XXXX? of a curiously how a probably, on not to guide. seeing trying this we're in XXXX? have can give be execution

Joseph Massaro

Joe. it's Chris,

jump can Kevin then and in. start me Let

at have XXXX. point this to We with be very cautious

been think our I very you've have -- think XXXX. cautious customers very, we've for I seen, as

before So year. all the we're initiatives including obviously from the expansion. of cost and We're very what stay that on margin margin number where was We of to the of that. discussed structure to took and Day, back margin it way the get going disruptions business Investor performance to at focused back of all the XXXX, to a we prior the away

would initiatives So environment. it the is challenging I just a will continue, but caution

I we on very as cost the react focused in -- we the we from time we'll in in volatility earnings on XX% it. we And X customer were the an at in proactive had on remarks, We're this and dropped can But third side. underestimate quarter We're organization. would I large -- As my we'll call. -- the not moment. I the earnings the the I in, best coming market mentioned have schedules on that jump prepared the think production last to

Chris McNally

has either cost think And think second Kevin particularly over -- of into volatility, the what ahead Can continued a that I all out incremental in then about preparing to in done you for what to you're some think maybe what will half way Any some about way be and the from my for follow-up going customers issues? about called carrying doing both that doing been is Joe. about proactively those buckets, of XXXX can that you're what be think we or we to we maybe XXXX. now get to is think agree of

Kevin P. Clark

Yes.

So Chris, great trying And we're it's -- sure start from a standpoint. make listen, to baseline I question. a what think

is that the a I reasonable think about premise baseline you talked and the one.

it. operators here by in of of All of For right? quarter salaried reduction It taking reduced an overall larger year OEMs OEM, see us, consternation headcount concern, it we a as We're front salaried obviously and creates We've sitting in to level last been XX%. year, production when we as our process by third XX%. by of headcount. though, X relates another large dropped the

of the cost as In North now facilities we're America. of a part addition, labor. midst in we're in And we in addition do as in focused on and comments out engineering? direct indirect and what a China consolidating that, well opportunities, to we productizing as And we're I to optimize -- solutions in manufacturing taking focusing very standpoint. how on investments do from made those a material can

years, building SoC semiconductor been capabilities of couple our up about China a last talking standpoint. sourcing the For we've from

Western principally that alternatives a European-based relative my have well. to we anywhere We SoC suppliers. number and referred Those as alternatives. remarks XX% delivering those savings of are cost adopting have in OEMs And in the now XX% I are between of Western are China that relative technologies. OEMs those prepared now evaluating several to to and semiconductor it

those vehicle be quarter to profitability on of the quarter. into levers were saw third we rolling step front in in last every we're and one and improve honest, So in focused this it we of production to down fourth the before

Operator

question Our from John next with Bank Murphy America. of

John Murphy

surprising, to of Chris on question probably Not the want up follow that just had. line I

decline what's you to going about which large think Xx cycle. we Kevin, on Just that know is as the is, all at here trough think basically peak that X I customer, in

the of that's like happens So kind something that in that amazing quarter.

EVs. getting particularly you incumbent You're quarter. At you're sort time, the the of to Chinese the same and rebasing to traditional some in XX% of domestics customers your around the sort said a of of and now overexposed downside,

And at of Tesla your in day, peaks that crept were charging kind up particularly robotaxi there the big I of wireless a customer. think lot the sneak is and a Tesla technology,

about and of So waiting if market, set how growth Is it market. reacceleration acceleration in you're products correct to be you does a without might even seem going. as choppy about recreate think you getting forward we what there's think to an 'XX but guide, go seem be that characterization? that like your it, into up do And a a above

Kevin P. Clark

Yes. No.

lines We product would certain So XXXX revenue of say growth towards and if a year in normalized look say, of come beyond. out sit for in you When come of where and would at environment, the amount we the that out we normalize, today, baseline, absolutely. in a great would has of we we're here and position at we say the look forecast, that. beginning from our sit strong

our very real last very, cost Two, I'd good one. well. front work pay over things. we about our chain have you will what we to that pay has We to I years I of and be start around manage in in ability control margin. and so starting the to that And of in costs and beyond. and and feel led a do team hard -- and very supply are think number initiatives Joe structure, feel that in that XXXX around dividends dividends, Joe And we the and our X with

outlook have it's in out, right? it's when schedules helpful growth, revenue about to is of plays us, the to concerned to we're from our year, see lost predict volume our certainly And What X% a a this But our a deliver our although And almost tough XX% doing OEMs, is level to quarter-to-quarter. that, that just volatility How increase decline a for increase quarter-to-quarter, challenge revenue we that's and almost we in operating growth wanted out to year income, in in alert EPS. we're well in, do. XX% that in product positioned portfolio. year investors earnings,

Our China, in significant made mix we've of customers progress.

are U.S.-based in down, at China. a out So China OEMs globals you look break EV the and those the opportunities balance are today when manufacturer. of our XX% Chinese you roughly local And with outside traditional mix, several and OEMs booking we're global local the and

about we customers. in good good So volatility What the OEM we the feel we feel from our about is are. where schedules don't

John Murphy

That's follow-up incredibly helpful. the And then on just a portfolio.

curious master in We've there. more through call in of it out, seen becoming those or a this SoC X Kevin, the and Just have a time? things. supplier if might we're that a this there that of software things portfolio Delphi something of hearing And might vision portfolio, with actions direction of as other in Motional value a the are these partners been and more holistic and shareholder with rebalancing. the in You've anything and reduction comment created times a there's that number there consider span you other team in partners over that even in those -- in lot portfolio kind SoC SOC. Is investment these change

Kevin P. Clark

our we'll John, are to see that's we're in value, those at. to that optimize things portfolio. to Yes, we drive continue And shareholder through the how we that we're And move with. -- value opportunities always we'll changes looking incremental forward at something do look extent,

out playing We're a of we We X The -- with business advanced much building great technologies. have plan. software a software and more X business, great we're segments. as it's ASUX businesses

that over has XX%-plus of within then and EV with market that distribution we segment have business, that sort Within is strong engineered headwinds industry-leading being components have is business very the an unfortunately hit associated margins. with power that the data growing operating we mix. compounded customer And business the adoption SPS with

evaluate So value. what We'll to we terms do continue portfolio. great in we have of a maximizing

John Murphy

on? on that Kevin, software side is the be might vision those anything -- vision going there specific of things

Kevin P. Clark

Well, we're X Gen solution the is -- vision agnostic a ADAS solution.

very we're focused X Korean-based architecture vision reference the investments what desire. open of any strong OEM are be in capabilities our better on the AIML One capabilities, and that that solution market solutions. future that very and mirroring customers we radar a in company to deliver has integration with relative performance very, what can seeing we what's very to call is So we're introduced going our the vision strong today at allows lower Those that would cost.

in we've an building So do. been our to solutions, solutions. more where solutions we're are likely whether Chinese be out than be only be a cost, view the time, that's that vision lower for though, emphasis, capability with screaming that's whether a really we're some out those customers our our what market SoC, chain trying China that software environment product. and Chinese point China that at we've that localizing Whether it's our for And of that better in is customers built supply demanding sourced on market, customers. real are the

Operator

to with go next We'll UBS. Spak Joe

Joseph Spak

$XX sequentially drop you sort and use like revenue. good drop a SMPS as $XX margins a in difficult the some we in of guys this the you dynamic have in in I guess how of saw an deal and cost to OI sort this versus because million just volatility a I want million of job on I'll with example, quarter environment. understand better clearly side X Look, operating done

that like schedules that here if else that over So case, that I some because actions labor sure segment. just that are near that's high think you the -- do term? And -- you since there's that's remain what what think the going if -- intensity to is, higher could want But volatile pretty other if in labor going what of to then is anything I on. make are

Kevin P. Clark

we and in -- Yes. of The it. manning big no Joe in plant our late we about for North OEMs schedules, basis. notice, in we day-to-day what couple that. third the and layoffs you amounts and of the idle America, and literally numbers, as to effectively quickly see we have sitting the When right, walk can on revenue, labor on have changes for said through have ability Joe, what labor recalibrate schedules massive challenge based more our we be. to the think But advanced When there, may a dropping reductions this or or with tables case we saw, quarter, whatever especially a do pay

a schedules, and to was that customer capacity reacting taken So transparently. basis of we in what have impossible. run rate the done those reduced What on with We've current we're go-forward now. we've line seeing

schedules coming reality, And we terms So deal volatility, with that. there layer in the to and lower. significant on in talked increase down the schedules too when volatile be But if of that conservative more on of production incremental conservatism the a more call, upside costs ended were we'll expensive. that even in it challenge may pinch we we rapidly, an a overlaid about but with earnings associated the The supporting manning last their level. it's just

team now. the bag We're It going and labor won't left we will manage holding to facilities. and myself rotating footprint the the efficient, out start downside. And taking to extent Joe, the decided on be we'll -- the our So we're there's less be upside. consolidating but

Joseph Spak

this lower efficiency experienced you've Correct? given say the sharp that declines is how it's still quarter? like inefficiency the planning you lower that in fair seen on than now to upside But you're

Kevin P. Clark

Yes.

. point. very a I think fair that's

Joseph Massaro

in all think X quarter. bit it it's to get customer moving. hard come Joe, And timing, a to We're I right, XX% a in we're that I said, just in of not just a little agree quickly that its It's right? that top as quarter, reacting just pivot going reduction to a done

volume it down, that You're see results just comes right? to the where the not quarter going in of

Joseph Spak

question Okay. bookings. the just heard decisions. a ones And some I on mean, the not second only as we've you're doing then OEMs that from

all players. just I on if of move or types this it's uncertainty to about. the with serve Presumably, And about legacy talked China the and across we some just that's wondering talk seem front, it's did then you -- I'm all products? though, positives specific you think faster. they given products if

to So offset there potential is as that there maybe in make continue progress you some, region?

Kevin P. Clark

Yes. From that on how the or just the actually a many are see typically vehicle new standpoint, China bookings introductions where program. a we enhancements and programs of That's an nature area given basis. and broader regions year-over-year seeing strong this what other have but me, very it's on stronger our year in than front the across numbers we're a of don't they're I in portfolio.

Joe, North we in Europe, America, be think of going opportunities that decisions relates a in between I we the it have now year-end. and number listen, to are to as made think funnel

we We do the in couple for surprise, to in happen assume good a year-end terms those we be next It's from could terms little of -- and we'll frankly, SVA of prudent we significant of an bit start that beyond. outlook ADAS The quarter funnel seeing just but that prudent. year to investors. still possible But in a just happen should first OEM opportunities as EV it are into there's it's and XXXX to for trying working as be We well, conservative, those standpoint upside before assume certain just or decided advanced provide hybrid significant. The standpoint and a out. revenue funnel customers extent, whether opportunities benefit quite solutions. of is those and pushed a on booking are the for plug-in head

Operator

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

Emmanuel Rosner

that's on implied over obviously QX, bit production very you on very and maybe of but a back environment market reacceleration QX, like big certainly expectations. seems think on done It a notice. like a short I impact guess, the backing into, So I a being cuts the expect challenging

you gives of are made. I how what in the confidence that level current quarter So some these into light quickly decisions of of guess

Joseph Massaro

-- tell I Joe. Obviously, Emmanuel, think we've start. addition challenged. I to right? down taking I'll be We're That's had production, taken it's for obviously year, customers highlighted in what you, just miss. those we vehicle to we've continue that QX full will

but are about, Those over the is launch course at Kevin as what building meaningful some talked launches I think cars, They're of the of offsetting are volumes because that, half year happening. expected in about for obviously, we happening. be lower activity themselves year. slightly world we the the the talked back launches, to this

So production active the active prepared -- out. There's comments, growth business, great that up XX% QX. the we're in still safety quarter my in then about I with China, business safety vehicle secular talked dealing as was including coming and in just in some

still vehicle giving us we that's a enough lines are in the So drops to have products product it's growing mix, obviously launching not and just production. global but new offset that

Emmanuel Rosner

a the... Okay. shifting And on I guess focus just with

Kevin P. Clark

basis, thing to I think about when year-over-year in can year an North last was I on you remember and just Emmanuel, other just there you? the interrupt growth, -- apples-to-apples want America. strike a

in base a incremental that. I to the less So year-over-year QX QX, to look I when $XX coming revenue by we low million, think revenues at be sequential you million fairly consider when growth, extent some it's roughly And at to impacted off you $XXX look of right? of QX. it's is the think than what it's

Emmanuel Rosner

elections, potential maybe from exposure, eye think Yes. with concerns shipped U.S. Mexico. feature a on potential on scenario outcome, of your would of us an around No, the actually helpful on particular, border? on maybe depending that's duties depending risk just terms next holistically, bit context. outcome? remind how week's about tariffs on the And rhetoric and that you managing like and And sort how in the in or and of investor environment being there's then crosses just things Can I you much think

Kevin P. Clark

you at in we tend move around, that And and all in region. of region. what noise region When to led sell XX% were manufacturing, roughly supply and we what chain, some for of very some so Joe from source a look we XX% push and areas source a at in went is what of you standpoint, XXXX, region regionalization active actually the chain we the manufacture in Yes. those all what be kind that products. When we electronics, around semiconductor activity. supply sure areas we Back given look it's through challenges, for

front Joe, . So to That manageable others. see of that it's for should like ultimately to my relative and way comments. We to extent, we're we've us done a it. lot. add pretty see the And what in we feel we'll tariffs happens.

Joseph Massaro

chain those change not do to So to ready need we'll obviously versed well I react. right? We happens, what this to tariff are before. flows of in agree and significantly permanent made with our And of through still some but our well, I as supply product The team in No, Kevin's did regimes to that we've react to again, version think and a current that. the what changes been place. to administration point, is

Operator

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

Mark Delaney

understand do volatility declines negotiations low for the And with? hoping OEMs traditional tracking better think pricing the reflect better economics was in relative I company secure single-digit been XXXX how industry. to to is the Aptiv dealing have historical will that able the are be that to you with

Kevin P. Clark

It's question. good a

do So with into constantly would OEMs, think most that's more out -- time customers we're as about Europe true and XXXX, the in with one costs? true I we in of North we think ongoing It's together I would strategically of activity. lot in look any different. in customers it's Asia. how to an in really with then lower with our I we price. discussions we're discussions say a some certainly aren't as our mean, on I head say America. I our And ways caveat, spending figure

you of an of big vehicle productized our about terms look we solutions. That's from benefits do things we've done we think system standpoint. we've our the done -- how what of full So system architecture from a how full when solutions, standpoint ASUX the of It's one do at unnecessary out one content take of solutions. design in our

labor identify in more engineered head we're footprint with seeing and America OEMs several we standpoint, From the costs we're as North do Mexico rotating working XXXX from there which high OEMs in sorts we those with you XXXX. They traction in remain on and terms that into more about past. are there of talked So a we've in savings, is and in focus of footprint helpful. how

to say, I'd So it's time a challenging them. certain of a time, a extent, more more for the collaborative, bit although

Mark Delaney

to electronic the announced connector OEM be active I targeted volts. affect electrical been use plan and more engineered My I second believe to voltage question got simplify at and its news helping with week, was quite as and Earlier in America connector but Aptiv. standard, realize North has leading architectures that low the its may Aptiv to the to this hoping better XX efficient and components. customers SBA, OEM you've around connectors their understand like how EV

Kevin P. Clark

years translated made over working and We're across progress lines part That with we of lot and of standardization We well well content invested and an to more both expect vehicle. certainly as happen. -- It's them. It's a into vehicle do active very in take we've off from that to that vehicle revenue costs particular important with on that a No. as always the standpoint. regions. in commitment opportunities, engineering the more of continue customer, terms how we're we're customer out would an the and from certainly is

see So opportunities we there.

Operator

We'll go with to Barclays. Dan Levy next

Dan Levy

performance right seasonally I about just manufacturing was to timing says ASUX? a the weaker what this we explain Wanted unique material you engineering to for year-over-year think period. pretty there be point with Is move, in ASUX, thought the Was starting supposed of which from in Maybe initiatives. something margins could start the DEC increase recoveries?

Joseph Massaro

don't talk talked in SoCs what from chain back -- a we I has restore work at little you We XXXX. the hand continue a the from number of side about, a dynamic, the talked lot we've were in where to them right? helps nothing it to cost supplier Day if And as bit moment, listen, at a I unique, and realized perspective, disruptions. that there To that volume even business overall, pre-supply you've the get place done there's of heard a even business. in margin Yes. going But was initiatives of effectively we about that to some extent, February just China manufacturing a about with perspective. Investor -- SOCs. XXXX, lot And us China don't to have changed

those. So headwinds in the on a material rotation where lot the performance, of we performance team engineering performance, despite the the countries, and 'XX talked of ESCOs delivering the of volume is material February about

what see it I it's with To So what bounce very from we've a think quarter-to-quarter comments around bit consistent on depending our volatility, just could seen. little happens you a about XXXX, you're perspective. Kevin, volatility in this term, something. low long if getting time the and business seeing. we what XXXX about to period, customer teen I margins But talked that's missed

Dan Levy

programs a follow-up, ask past the but numbers the we in a not what bookings expected. along was very past, wanted just to the asking, lines delays, is clear a volume as in Mark lot more you at Great. I Okay. something of post booked the just high and obviously of coming in bit then look that was the as And

programs, the you clearly the the of in aren't expense, what program the process maybe booked, of recoveries, given volumes exist lot maybe that some a talk already as you incurred You've the just about tooling these planned. could coming incremental validation opportunity for may of

Kevin P. Clark

Yes.

to what happen, a little So to -- and OEM. question. tends great it by happen What tends it's bit varies a

that, of be is to is some an extent about a the supplier tends Others, about What happen, view with fill negotiation lost formulaic recognition profitability that tends to lost it's of of what works it of how be a very process. to profitability. commercial a that that kind recruitment investment hole. Dan, have mix a programs. whole discussion to a Some That replacement standpoint, negotiation. opportunities then then investment made other to revenue you'd And than more from often consider and

sitting going and well. It's getting matter just environment as and those say, So the them with just we're walking over having those customers, you through goal by they're large, and can imagine, relatively a today, I'd down line. of discussions the just given of sorts

Dan Levy

this Is yet have programs. to... remind in maybe And just resource would outlay but that validation booked, is CapEx? not stuff had start this to the us expense of just you've you these launched can Or on appeared that mostly OpEx,

Kevin P. Clark

would launch, ago, engineering. to really we business advanced our -- varies engineering I extent, Yes. Starting so little some and vary remarks, be mix. prepared you great years solutions our in phase productized -- not focused don't So vary close question. little investment and it would by it's first providing right? It's bit. by a services that vary would that bit and previously, it No, investment and engineering a we're a our program. on X bit that about a and mentioned reusable, we bit by It how are, as were program to

be would that call it phase, the So engineering. advanced so first

tooling, prior would is, The And validation. actual the and would development manufacturing the late as launch. in about, the basically floor all maybe be introduction upon investing that integration then is process, in phase testing, that you're of last actual to equipment depending second which phase highlighted, it of be solution, you solution or what space

Operator

Narayan with next to RBC Tom Capital Markets. go We'll

Gautam Narayan

calls if you in market on, production answered including the cut couple over XX%. XQ? other full that going a this that revised already Joe, year, have post of for growth customer Apologies you've expectations The the

Joseph Massaro

Yes.

that You we look looking view revenue follow X% down. down numbers, in and you this at a at you're I if as is referenced through remarks, the growth my growth, -- market revenue in prepared X%

Gautam Narayan

that Mexican Was the quite peso was bit has the your weakening meaningful peso? then the peso down past, contribution the margin-wise, was the hurt Okay. a and appreciation margins. And a -- down that quarter, in in

Joseph Massaro

from perspective. was fairly overall a quarter neutral FX

Just there peso helpful, weaker not in A particularly were the material is quarter. it's movements. but some

Gautam Narayan

my And last Okay. one. then

hand, net they're flip number. say, As a XX to that because kind SPS. EV production, that of you Is But stronger production, say? guys -- compliance. I lower out. you push one would a in expecting of much that let's hard be In on think EV net much COX on Europe, a next Europe it's be could to like or bigger the But lot million sales million production but world fair year there's number large XX I for OEM their beneficiary call to know about and this overall that think Europe, of to is with with the on kind be side, European that on a a commented of used yesterday there has expectation

Kevin P. Clark

Yes.

a -- Kevin. if a program you you you the content hybrid, less it's it's opportunity, it's Tom, X.X. if bit were to mix, and a If if it's that, it's And that. you But say it's would know and it's know little I about, a depends on right? if than customer normalize, It hybrid, Xx plug-in

a there's that So out you're again, on and platform mix. there. of opportunity sort it's dependent net But should revenue right, be incremental OEM

Operator

We'll Paribas. with go BNP James Picariello next to

James Picariello

Maxieye might deal. that. speak stack, just an in was XX% to Any Can you you how opportunities that it I can to that was question, And in additional Siemens, acquire stake you and Aptiv familiar yesterday have unlocks yesterday influence did just China? because in? the Wind $XX there reference the Altair the Altair my plays billion any that then play River color believe assuming on automotive be software a know for and where So competitive whether Aptiv you in I in announcement could shed and any areas on within light just this by

Joseph Massaro

speak I'll take and Kevin can Altair. then Maxieye, to

of things. bias with as China tech been China among a there's that requires in you talking think I safety types those SoC. significant see active as regulatory everyone mapping, where right? it. China knows, where development stored, around the data seeing right, look, There's about do in the we're requirements obviously, OEMs. to of first local a local presence, We customer So We've

China develop that system, are OEMs that the to you into So ability systems China and consistent having safety to the active -- Gen look plugs X with a from have. a it sense agnostic local have system a because that have us, vision vision perfect for Chinese very -- solution sell makes within then

great and the have businesses seen smart a I the making really us of We've from to want path this us do in know in is done a helping to from clear types Kevin, said, something add. these is we've commercial a past. as that you if perspective gotten and us, company. some past, Maxieye you've for of investments them years the over to last So couple

Kevin P. Clark

Yes. Yes.

is Wind space. part chain So Altair, it, what particular and the the space. of that -- a of launching systems engineering they River tool automotive I'm Altair having a strong aware is play in of simulation engineering, position the, engineering not part industry. the tool of within chain call delivers small in That's kind a real

competitor, it's process. how about development, I but you small an So view overall really make do much they're more you how them That's about make part a efficient do -- software wouldn't a Wind River focused as more to say broader They're what landscape, hoping we're it landscape. bigger of the space. of focused part. on the industrial a I'd more automotive kind does industrial today. We're on the really make

Operator

final will question Colin We Langan take with Fargo. from our Wells

Colin Langan

Great.

what to to sure you're to trying I to make very wanted question, indicate. up follow Just the beginning understand

talked a I you've over about year. past, think think market to margin. of XX.X% sort get next in trying talked I to about the growth And mid-single you

of volatility, just cautious in track You Are thinking we targets in that all so much we've sort mix whatever? just skepticism on it volatility a there's and of see there's and now. seem interpreting more about seen that or it's bit are don't given it's if terms on lot QX of those a we

Kevin P. Clark

that we're Colin, see of Yes, to yes, sort level just be clear, comfortable we if volatility, performance. don't with that of

right now, clear us it with that to of the makes as Obviously, no Just goes cautious. when volatility potentially site we're seeing line away.

grow -- mean, So going the again, is you well. but grow in are earnings business, know we to -- to going underscoring growth that's I going important, business for XX%. revenues going performing revenue really we see to investors, the and to I and as decline have almost extremely a know underlying XX%. is X% are EPS numbers, is

a concerned much shorter feel management sort is much time of the production we here than So And accustomed team frame of we volatile to. more to our the about schedules feel really our What good is what the visibility now business. customers. about they're in

should you what our into read that's So comments.

Colin Langan

on earlier, the Europe standards this into turn do in assuming tougher a forced shouldn't that like the push almost you regulatory because that And start news someone has growth. then And EV year then and of -- And next get actually corner the locked you in next regulations can asked then to done U.S. business Is the how because about EPA get touching have the remind us good still that year? year?

Kevin P. Clark

the you're that's go been cars. need very build Yes, customers but our right, Listen, And numbers. theory, I choppy absolutely to I'll let year. this the think through Joe in

Joseph Massaro

We line the to big EV of in But cars. XX% going as Yes. I but for to was it's step That the have -- market little fully something technology. in range full year. down EV. you year in down that in bit strong number, maybe is Kevin's position or but XX% comments, obviously that is -- prepared to back product the they to China. that about, Colin, my very a EV this taking build XX% in business is, like we're a likely Europe talked the And headwinds as the we a some quarter, certainly point, obviously mentioned was North down. And lower, you're and we've America have have in in see

for that hybrids. got So return. EV. meaningfully very got the or full the it's hybrid, tech We've the see we well right really tech straight positioned. but for right when Plug-in We the production just do

Operator

for back to Kevin Clark conference turn closing the or That additional any would the conclude I will Q&A like session. remarks. to now

Kevin P. Clark

that that that controlling we're Thank say or cost you very we're to in of on. really, very ownership. much, we are our for customer operator. the is lower how what can It's And their total we control, up, us, about delivering wrap of way kind I'd prongs and prong Listen, focused much about that's would Their -- what maybe it's of would to there investors things. to leave I X strategy. terms one solutions thinking

solutions we're our of interest which more and we'll do cost them of focused attractive that and especially deliver the light lower We we over the the how we more to vehicle, cycle their on and in in lower customers, are very is life in. environment believe adoption, see

The at of today. the actions baseline taking second cost that several we're off operating is we're

extent inefficiencies or deal capacity to we with need see upside standpoint excess But those we inefficiencies be some will what schedule excess from do benefits. the There to with. So we're less resources. and an see absorbing a electrification will we today than may some standpoint, be that

feel we feel the feel the business So what on. about volatility things. to the We team robustness it. react the good focused and about really Again, the simple model. our very in that environment the business good as very very a much of sits focus We need about is concerned just nearing to operating. is how the And to those we're that's result, very today

if you listen for with we'll Thanks your us time taking So you today. appreciate know, the our questions, We to let to any appreciate follow investors. have further up time listen, as And we call. you. please

Operator

today's gentlemen, And for Thank ladies and concludes your you this participation. call.

disconnect, and have now You a may day. great

Aptiv (APTV) 31 Oct 242024 Q3 Earnings call transcript