Autoliv, Inc. Q2 2026 Earnings Recap

Autoliv shares fell 6.2% after the quarter as investors reacted negatively to margin compression driven by restructuring-related charges and gross margin headwinds, despite stable sales and reaffirmed guidance.

Key Takeaways

• Q2 sales rose modestly by approximately 3% year-over-year, supported by continued outperformance in China and India and favorable currency effects.
• Adjusted operating income increased 7% to $217 million, but adjusted operating margin declined slightly to 9.6%, down 30 basis points, affected by a supplier settlement reversal and impairment charges related to the Turkey restructuring.
• The company recognized $90 million of restructuring charges in the quarter, part of a $142 million total expected charge from exiting Turkish manufacturing operations, which weighed on gross margin (~80 basis points impact combined with other items).
• Operating cash flow improved significantly to $434 million, up $157 million, supporting shareholder returns including $200 million in share repurchases and a $64 million dividend payout.
• Full year guidance was reiterated, including flat organic sales and an adjusted operating margin target around 10.5%–11%, assuming a 2.5% global light vehicle production decline and $110 million raw material headwind.