PHINIA Inc. (NYSE: PHIN) reported fourth‑quarter and full‑year 2025 results on February 12, 2026, with net sales of $889 million for the quarter, up 6.7% year‑over‑year, and an adjusted earnings per share of $1.18, falling short of the consensus estimate of $1.22 by $0.04. The company guided 2026 net sales to $3.52 billion to $3.72 billion, representing 1% to 7% growth from the prior year, and projected adjusted EBITDA of $485 million to $525 million, translating to an adjusted EBITDA margin of 13.7% to 14.3%. Adjusted free cash flow guidance for 2026 is $200 million to $240 million, and the adjusted tax rate is expected to fall to 30%–34%.
The revenue beat was driven by tariff recoveries and increased volumes in Asia and the Americas, which offset a decline in European volumes. Management highlighted disciplined execution and strong customer partnerships as key contributors to the upside, while noting that the company remains focused on organic growth and capital allocation amid macro headwinds. The 6.7% year‑over‑year increase reflects a solid demand environment in core markets, even as the company navigates evolving tariff regimes.
The EPS miss can be attributed to margin compression from tariff‑related dilution and foreign‑currency effects, which reduced profitability relative to analyst expectations. While revenue rose, the company’s adjusted EBITDA margin slipped slightly from 14.1% in 2024 to 13.7% in 2025, indicating that cost pressures and mix shifts weighed on earnings. The $0.04 miss against a $1.22 consensus underscores the impact of these headwinds on profitability.
Guidance for 2026 signals confidence in continued growth, with net sales projected to rise modestly and adjusted EBITDA expected to remain in the mid‑$500 million range. The company’s outlook maintains a stable margin range of 13.7% to 14.3%, suggesting that management believes it can preserve profitability while expanding sales. The free‑cash‑flow guidance of $200 million to $240 million reflects a focus on maintaining liquidity and supporting future investments.
Management emphasized disciplined execution and tariff mitigation. President and CEO Brady Ericson said the company delivered a solid finish to 2025, navigating evolving tariffs through operational depth and strong customer partnerships. CFO Chris Gropp added that the company is entering the next chapter of growth. The market reacted positively, with the stock rising 0.18% in pre‑market trading and remaining near its 52‑week high, reflecting investor confidence in the revenue beat and forward guidance.
PHINIA’s results are the first detailed financial metrics for its independent operations since the July 2023 spin‑off from BorgWarner. The company also completed the acquisition of Swedish Electromagnet Invest AB for approximately $47 million in Q3 2025, further expanding its product portfolio and geographic reach. These developments underscore PHINIA’s strategy to strengthen its position in growth markets such as aerospace, defense, and alternative fuels while maintaining a disciplined capital allocation approach.
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