GTX

Garrett Motion Inc.

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Overview

Garrett Motion designs turbochargers that boost engine power and efficiency for automakers like Volkswagen and Ford. Revenue comes from gasoline (44%), diesel (

Garrett Motion designs turbochargers that boost engine power and efficiency for automakers like Volkswagen and Ford. Revenue comes from gasoline (44%), diesel (23%), and commercial vehicle parts. They are diversifying into high-tech cooling systems for data centers via a Trane Technologies partnership. They sell directly to major vehicle manufacturers and provide replacement components to the global aftermarket.

What They Do (Plain English & Analogies): Think of Garrett as the world's expert in 'high-speed spinning machines.' For decades, their bread and butter has been turbochargers—essentially high-tech fans that force air into car engines to make them more powerful and fuel-efficient (like a specialized breathing apparatus for an athlete). Now, they are taking that same 'spinning' technology and applying it to new areas: electric motors for heavy trucks, compressors for hydrogen fuel cells, and high-efficiency cooling systems for massive data centers. They are essentially pivoting from being an auto parts maker to a high-speed industrial technology provider.
Very Brief History: Garrett was originally the transportation systems division of Honeywell before being spun off as an independent company in 2018. Shortly after the spin-off, it navigated a strategic Chapter 11 restructuring (2020-2021) to resolve legacy asbestos liabilities and debt inherited from Honeywell. Since emerging, the company has aggressively diversified away from traditional internal combustion engines, focusing on hybrid-vehicle turbos and zero-emission technologies for industrial and data center applications.
"Street Stereotype": The 'Last Man Standing' of the internal combustion era. For years, investors viewed Garrett as a 'melting ice cube' that would disappear with the rise of electric vehicles. However, the narrative has recently shifted to Garrett being a 'Cash Flow King' that is successfully using its dominant turbocharger profits to fund a high-growth pivot into data center cooling and power generation.
Subsidiaries On Linked In*: Garrett Motion
Customer Sectors & Example Clients: Sectors include Light Vehicle (Passenger Cars), Commercial Vehicle (Trucks/Off-Highway), Industrial HVAC, and Power Generation. Specific clients include Volkswagen, Ford, BMW, Stellantis, Toyota, and Honda in the passenger space; Caterpillar, Cummins, and PACCAR in the commercial space; and Trane Technologies in the industrial HVAC/Data Center cooling sector.
New Customers / Segments They'Re Targeting: Garrett is aggressively targeting the Data Center infrastructure market, specifically for backup power (stationary gensets) and high-efficiency cooling (E-Cooling). They are also gunning for the heavy-duty electric truck market with their E-Powertrain (E-Axle) technology and the industrial HVAC market through a major strategic partnership with Trane Technologies.
How Key Themes May Help/Hurt: Garrett is a major beneficiary of the 'Big Beautiful Bill' (infrastructure and data center spend). As AI drives massive demand for data centers, Garrett's E-Cooling technology—which offers 10% energy savings over traditional systems—becomes a critical solution. However, they are sensitive to 'Motion Control' build-outs; while their E-Axles benefit from vehicle electrification, a faster-than-expected total shift to Battery Electric Vehicles (BEVs) could shrink their core turbocharger revenue before the new segments fully scale.

3 Main Long-Term Bull Details

Data Center Pivot: The expansion into industrial cooling and stationary power (already a $100M+ business) provides a massive growth engine decoupled from the automotive cycle. 2) Hybrid Resilience: As pure EV adoption slows, the market is shifting toward hybrids, which require more complex and often higher-margin turbochargers. 3) Capital Allocation: Management is committed to returning 75% of free cash flow to shareholders through dividends and buybacks, supported by a dominant >50% win rate in the legacy turbo market.

3 Main Long-Term Bear Details

Terminal Value Risk: The core turbo business still faces long-term obsolescence if the world eventually moves to 100% BEVs. 2) Margin Mix Headwinds: Rapid growth in the Chinese gasoline market and a decline in high-margin aftermarket sales can compress overall EBIT margins. 3) Execution Risk: The 2027 ramp-up of E-Cooling and E-Powertrain technologies must be flawless to offset the structural decline of legacy diesel segments.

Competitors And Differentiation: Primary turbocharger competitors include BorgWarner, IHI Corporation, and Mitsubishi Heavy Industries. In the new cooling and power segments, they compete with industrial giants like Vertiv or Cummins. Garrett differentiates through 'Automotive Scale and Quality'—they can produce high-tech, oil-free, high-speed machines at a volume and cost-efficiency that traditional industrial players cannot match because they have perfected the technology for millions of vehicles.
Recent Performance & What The Market'S Focused On: Garrett delivered a strong 2025 with $3.58 billion in sales and a 14.2% adjusted EBIT margin. The market is currently laser-focused on the February 2026 announcement of the strategic collaboration with Trane Technologies. Investors are watching for the first series production of E-Cooling units in 2027, which management expects will help the cooling segment reach 5% of total company revenue by 2030.
Brands And Revenue Segments: Brands: Garrett, Garrett Motion. Revenue Segments (FY 2025): Light Vehicle Gasoline (44%), Light Vehicle Diesel (23%), Commercial Vehicle (19%), Aftermarket (11%), and Industrial/Stationary Power (growing, >$100M).

Bull / Bear Details

Updated February 20, 2026. Garrett Motion is successfully transforming from a legacy turbocharger leader into a high-growth industrial technology provider. By l

Thesis

Updated February 20, 2026. Garrett Motion is successfully transforming from a legacy turbocharger leader into a high-growth industrial technology provider. By leveraging its "last man standing" dominance in turbos to fund a pivot into data center cooling and stationary power, GTX is decoupling from cyclical automotive trends. With a strategic Trane partnership and 14.7% EBIT margin guidance for 2026, the bull case is bolstered by accretive non-auto growth and aggressive capital returns.

Bull case

Garrett maintains a dominant "last man standing" position in the turbocharger market, consistently securing over 50% of new business awards. This dominance allows the company to outperform a projected 2% decline in global light vehicle production for 2026. Its stable, cash-generative core provides the necessary capital to fund high-growth transitions into zero-emission and industrial technologies while maintaining robust operational margins.
The company is rapidly scaling its non-automotive footprint through a strategic collaboration with Trane Technologies. By integrating oil-free, high-speed centrifugal compressors into commercial HVAC and data center cooling, Garrett offers 10% energy savings over incumbents. This industrial cooling segment is expected to exceed 5% of total revenue by 2030, providing a high-margin, accretive growth vector that leverages existing automotive-scale R&D.
Management remains committed to a shareholder-friendly capital allocation framework, targeting a 75% distribution of adjusted free cash flow. A new $250 million share repurchase authorization for 2026, combined with a sustained dividend and voluntary debt repayments, provides a strong valuation floor. This disciplined approach, supported by 80% free cash flow conversion, ensures significant total return potential as the business diversifies.

Bear case

Garrett faces structural margin pressure from an unfavorable product mix as lower-margin gasoline turbochargers grow to 44% of sales, offsetting higher-margin legacy diesel. Additionally, newly implemented tariffs and persistent net inflation require continuous, aggressive operational productivity gains just to maintain current margin levels. Any failure to execute on these cost-saving initiatives could lead to EBIT contraction despite volume gains in new segments.
The company remains heavily exposed to a cooling global automotive market, with management forecasting a 2% decline in light vehicle production for 2026. Weakness in the North American aftermarket and off-highway sectors reflects broader industrial sensitivity. If the anticipated recovery in commercial vehicles fails to materialize or if BEV penetration accelerates beyond the expected 19%, Garrett's core cash flow engine could stall.
Garrett's ambitious pivot to $1 billion in zero-emission revenue by 2030 carries significant execution risk. The transition relies on the successful 2027 ramp-up of E-Powertrain and E-Cooling technologies in highly competitive markets like China. Delays in customer adoption or increased competition from established industrial HVAC and power electronics players could jeopardize these long-term targets and strain R&D resources.

Bull / Bear Case

Bear Case: Garrett remains tethered to a cyclical and declining internal combustion engine (ICE) market, with global light vehicle production expected to drop 2% in 2026. The company faces a structural margin headwind as high-margin diesel and aftermarket sales are replaced by lower-margin gasoline turbochargers, particularly in competitive markets like China. Furthermore, the ambitious goal of $1 billion in zero-emission revenue by 2030 carries significant execution risk, as it requires competing against established industrial giants in the HVAC and power electronics sectors. Persistent macro pressures, including North American aftermarket destocking and tariff-related costs, continue to squeeze the bottom line. If the transition to battery electric vehicles (BEVs) accelerates beyond the projected 19% penetration or if the industrial cooling ramp-up stalls, Garrett's "melting ice cube" core may decline faster than its new ventures can scale, leaving the company with stranded assets and compressed multiples.
Bull Case: Garrett Motion is successfully transitioning from a legacy turbocharger manufacturer to a high-speed technology provider for data centers and industrial HVAC. The company maintains a "last man standing" dominance in the turbocharger market with a >50% win rate, allowing it to outperform a declining global light vehicle production environment. The strategic partnership with Trane Technologies to deploy oil-free E-Cooling compressors targets the high-growth data center market with a solution offering 10% energy savings. With 2026 guidance projecting margin expansion to 14.7% and $405 million in free cash flow, Garrett is using its cash-generative core to fund an accretive pivot. Aggressive capital returns, including a $250 million share repurchase authorization and a 33% dividend hike, provide a robust total return profile while the company rerates from an "auto" to an "industrial tech" multiple.
More Compelling & Why: Bull. GTX is exceptionally undervalued at a ~20% Free Cash Flow (FCF) yield based on 2026 guidance of $405M FCF. The strongest argument is the Trane partnership, which provides third-party validation that Garrett's high-speed rotating technology is a superior, accretive solution for the AI-driven data center cooling boom, not just a legacy auto component. This pivot effectively decouples GTX from the ICE "terminal value" risk. I would flip to Bear if 2026 gasoline share gains fail to offset the 2% LVP decline, or if the Trane series production ramp-up (slated for 2027) faces technical delays.

Key Factors5 rows

Key Factor	Why It Matters	What To Watch	What It Signals	Where/How To Track	Free Alt Data	Paid Alt Data
E-Powertrain (Electric Axle) Series Production Milestones	Garrett's first heavy-duty electric axle (E-Powertrain) for commercial vehicles is slated for production in early 2027. Intra-quarter updates on testing and pre-development contracts are leading indicators for the $1B zero-emission revenue goal.	Announcements of additional pre-development contracts or 'Series Production Awards' for E-Powertrain beyond the initial heavy-duty wins. Watch for progress in the passenger vehicle testing phase.	Announcement of a second major OEM award for E-Powertrain = Bullish; Management commentary citing 'delays in customer decision-making' = Bearish.	Quarterly Earnings Calls; May 20 Investor Day Presentation; Industry trade shows (e.g., IAA Transportation).	LinkedIn: Tracking headcount growth in Garrett's 'Zero Emission' and 'E-Powertrain' business units in Rolle, Switzerland and China.	Thinknum: Job postings for 'Inverter Design', 'High-Speed Electric Motor', and 'E-Axle' engineering roles.
Gasoline Turbo Outperformance vs. Global LVP	With global light vehicle production (LVP) forecasted to decline 2% in 2026, Garrett must maintain its >50% win rate to grow. Share gains in hybrid and range-extended EVs are critical to maintaining the 14.7% EBIT margin target.	The spread between GTX Gasoline Sales growth and the -2% Global LVP benchmark. Specifically, watch for growth in Asia/China where gasoline volumes recently declined.	GTX Gasoline growth >3% (a 500bps outperformance vs. LVP) = Bullish; Growth at or below -2% = Bearish (loss of market share in the transition to hybrids).	Quarterly Earnings Press Releases; S&P Global Mobility (formerly IHS Markit) LVP Forecasts.	CAAM (China Association of Automobile Manufacturers): Monthly wholesale data for hybrid and gasoline passenger vehicles.	MarkLines: Global model-level production data to track Garrett turbo fitment on new hybrid launches.
Stationary Power Generation Revenue Growth	Stationary power (gensets for data centers) exceeded $100M in 2025. This segment is a high-margin offset to automotive volatility. Continued growth validates Garrett's 'last man standing' turbo tech being repurposed for AI infrastructure.	Quarterly revenue contribution from 'Industrial' or 'Stationary Power' applications. Management expects this to scale alongside the E-Cooling business to exceed 5% of total revenue by 2030.	Stationary power revenue exceeding $30M per quarter in 2026 = Bullish (accelerating demand); Revenue flat or below $25M = Bearish (market share loss to incumbents).	SEC Form 10-Q (Revenue by Segment/Application notes); Quarterly Earnings Presentations.	ImportGenius/Panjiva: Tracking shipments of 'Turbochargers' to genset manufacturers like Cummins or Caterpillar.	Industrial Info Resources (IIR): Tracking new data center project starts and backup power requirements.
Trane Technologies E-Cooling Commercial Launch	This marks the first major validation of Garrett's 'Automotive-to-Industrial' pivot. The high-speed centrifugal compressors are accretive at start of production and target the high-growth data center cooling market, diversifying revenue away from cyclical automotive production.	Availability of initial units to select customers in 2026 and progress toward the 2027 series production ramp-up. Monitor for any expansion of the partnership beyond commercial HVAC into hyperscale data center specific contracts.	Announcement of first customer installations in 2026 = Bullish; Delay in 2027 series production timeline = Bearish; Confirmation of >10% energy savings in real-world Trane lab tests = Bullish.	Company Press Releases; Trane Technologies (TT) Quarterly Earnings; Garrett Investor Day (May 20, 2026).	Google Trends: 'Trane oil-free compressor', 'Garrett E-Cooling'; US Census Bureau: Value of Construction Put in Place (Data Centers).	Thinknum: Engineering job postings at Garrett Motion with keywords 'HVAC', 'Centrifugal', or 'Refrigerant'.
2026 Share Repurchase Program Execution	Management authorized a new $250M share repurchase program for 2026. This is a key component of their 75% FCF distribution target and provides a valuation floor while the company transitions to zero-emission tech.	The pace of buybacks in Q1 and Q2 2026. In 2025, the company repurchased $208M; the $250M target represents an aggressive 20% increase in capital return capacity.	Quarterly buybacks >$60M = Bullish (commitment to 75% payout); Buybacks <$40M without an M&A announcement = Bearish (cash flow constraints).	SEC Form 10-Q (Part II, Item 2: Unregistered Sales of Equity Securities and Use of Proceeds).	Company Press Releases regarding 'Quarterly Dividend Declaration' and 'Share Repurchase Updates'.	Bloomberg: GTX Equity Buyback Yield and Total Shareholder Return (TSR) metrics.

Key Reported Metrics3 rows

Metric	Why It Matters	Last Period
Adjusted EBIT	Management guided for a 14.7% EBIT margin in 2026, a 50 bps expansion. Markets are watching for Garrett's ability to offset unfavorable product mix (lower-margin gasoline) and inflation through operational productivity and the ramp-up of accretive industrial technologies.	-1.3%
Stationary Power & Industrial Revenue	This segment is the cornerstone of Garrett's diversification into data centers and HVAC via the Trane partnership. Investors are tracking this to see if non-automotive revenue can scale toward the 5% total revenue target by 2030, providing a higher-multiple growth vector.	>10%
Net Sales (Constant Currency)	This metric isolates organic demand from FX volatility. Investors use it to verify if Garrett is successfully outperforming the global light vehicle production (LVP) decline (projected at -2% for 2026) through market share gains in gasoline and hybrid turbochargers.	+1%

Key Questions

Can the newly announced Trane Technologies partnership and the scaling of stationary power (data centers) provide enough high-margin growth to offset the projec

Can the newly announced Trane Technologies partnership and the scaling of stationary power (data centers) provide enough high-margin growth to offset the projected 2% decline in global light vehicle production and continued weakness in the aftermarket?

Question 2: Can Garrett successfully execute its operational productivity initiatives to achieve the guided 14.7% Adjusted EBIT margin for 2026, effectively defending against an unfavorable gasoline product mix and ongoing tariff pressures?
Question 3: Will the accelerated $250 million share repurchase authorization and commitment to a 75% free cash flow payout trigger a valuation rerating toward industrial peers, or will cyclical automotive headwinds continue to weigh on the stock's multiple?

Rerating Thresholds3 rows

Metric	What'S Needed For Rerating	Why It Matters	Earnings Date
Net Sales (Constant Currency)	A return to positive growth in the range of +1% to +3% (Constant Currency). This requires outperforming global light vehicle production by 400-500 bps, stabilizing the high-margin aftermarket segment, and showing stationary power/industrial sales scaling toward a $150M+ annual run rate for 2026.	Hitting positive growth dispels the 'melting ice cube' narrative of terminal ICE decline. It validates Garrett's 'last man standing' market share gains and proves the data center cooling pivot is large enough to offset structural diesel headwinds, justifying a valuation rerating toward diversified industrial technology peers.	2026-02-19
Commercial Vehicle Revenue	A return to positive year-over-year growth (0% to +3%), representing a ~1,100-1,400 bps improvement from the current -11.3%. Investors need to see this growth coupled with a sequential stabilization in China CV wholesale data to confirm the 'green shoots' thesis and the end of the destocking cycle.	Commercial vehicles are a high-margin segment. Positive growth reverses the 'unfavorable mix' headwind caused by lower-margin gasoline sales, protecting the 14.7% EBIT margin. It validates management's recovery thesis and provides the diversified cash flow needed to fund Garrett's $1 billion zero-emission technology pivot by 2030.	2026-02-19
Adjusted EBITDA	To trigger a rerating, Garrett Motion needs to reverse the recent -13.2% year-over-year decline in Adjusted EBITDA and achieve a margin threshold of 17.5% to 18.0%. Specifically, the market is looking for absolute Adjusted EBITDA growth of 5%+ year-over-year, supported by stationary power (data center) revenue exceeding a $150 million annual run rate and a stabilization of high-margin aftermarket sales to offset lower-margin gasoline turbo growth in China.	Hitting an 18% EBITDA margin validates the 'automotive-to-industrial' pivot, proving Garrett can maintain profitability despite the ICE-to-EV transition. This shift allows the stock to shed its 'legacy auto' discount (6x EBITDA) and rerate toward industrial/thermal management multiples (10x+) as data center cooling becomes a core earnings driver.	2026-02-19

Earnings Transcript Summary2 rows

2026-02-19 · 2025Q4 Earnings Call

3 Things Management Is Most Focused On	Call Takeaway & Tone	Prior Quarter'S Y/Y Growth By Segment	3 Things Analysts Most Pressed On (And Mgmt Responses)	Revenue Segments
1. Industrial E-Cooling & Trane Partnership: Launching a strategic collaboration with Trane Technologies to move automotive-scale high-speed centrifugal compressors into the HVAC and data center cooling markets. 2. Zero-Emission Technology Scaling: Accelerating the E-Powertrain and E-Cooling portfolio to reach >5% of total revenue by 2030, targeting high-growth verticals like data centers. 3. Disciplined Capital Allocation: Returning 75% of adjusted free cash flow to shareholders, supported by a new $250 million share repurchase authorization for 2026 and a sustained dividend.	Takeaway: Garrett Motion is successfully pivoting from a legacy automotive supplier to a diversified industrial technology provider, specifically targeting the AI-driven data center cooling and power generation markets. The company is using its 'last man standing' cash flow from turbochargers to fund an accretive entry into HVAC. Tone: Confident and strategic.	Q3 2025 Y/Y Growth: Total Net Sales +9% reported (+6% at constant currency). By segment: Gasoline +10% (accelerated from Q2); Diesel showed recovery in EU/NA; Aftermarket was weak/declining; Stationary Power/Industrial saw double-digit growth. Note: Q4 constant currency growth of +1% represents a deceleration from Q3's +6%.	1. Trane Partnership Economics: Analysts questioned the margin profile and CapEx requirements for the new HVAC venture. Management responded that the business is accretive at start of production (SOP) and leverages existing automotive R&D to minimize incremental CapEx. 2. Competitive Edge in Cooling: Analysts asked how Garrett's foil bearing technology compares to incumbent magnetic bearings. Management stated their solution offers 10% real-world energy savings, better controllability, and lower maintenance costs. 3. 2026 Guidance vs. Industry Headwinds: Analysts pressed on the 2026 outlook given a projected 2% decline in global light vehicle production. Management explained that share of demand gains in gasoline/hybrids and a 1.5% recovery in commercial vehicles will drive outperformance.	Q4 2025 Y/Y Growth: Total Net Sales +6% reported (+1% at constant currency). By segment: Commercial Vehicle and Diesel experienced growth; Gasoline volumes declined outside of Europe (particularly in Asia); Aftermarket declined due to lower demand for off-highway applications in North America.

2025-10-23 · 2025Q3 Earnings Call

3 Things Management Is Most Focused On	Call Takeaway & Tone	Prior Quarter'S Y/Y Growth By Segment	3 Things Analysts Most Pressed On (And Mgmt Responses)	Revenue Segments
1. Market Share Gains in Gasoline: Leveraging new launches and ramp-ups in China, Europe, and India to outperform the broader light vehicle industry. 2. Expansion into Non-Auto Verticals: Rapidly scaling stationary power (gen-sets for data centers) and E-Cooling technologies for industrial applications to diversify beyond traditional automotive. 3. Aggressive Capital Returns: Utilizing strong free cash flow to return value via a 33% dividend increase, $84M in share repurchases this quarter, and voluntary debt repayments.	The takeaway is that Garrett Motion is successfully navigating a volatile automotive environment by gaining market share in gasoline turbos while pivotally expanding into the high-growth data center cooling and power market. The tone was notably confident and positive, underscored by a raised full-year 2025 outlook and a significant dividend hike, signaling management's belief in the sustainability of their cash flow and technology transition.	In 2025Q2, Garrett reported: Total Net Sales -2% at constant currency (deceleration from Q1); Light Vehicle Gasoline +5% (Q3 accelerated to +10%); Light Vehicle Diesel -4% (Q3 showed recovery in EU/NA); Aftermarket -6% (Q3 remained weak but stabilized). Overall, Q3 2025 constant currency growth of +6% represents a significant acceleration from the -2% seen in Q2 2025.	1. Margin Compression from Product Mix: Analysts questioned why strong volumes were offset by mix. Management responded that high growth in China gasoline (lower margin) and weakness in high-margin Aftermarket/Commercial Vehicle segments created a temporary headwind, though operational productivity is offsetting this. 2. Zero-Emission Revenue Path: Analysts asked for the roadmap to the $1B 2030 target. Management highlighted the 2027 launch of E-Powertrains and the immediate 'green shoots' in E-Cooling for data centers, noting these products carry margins equal to or better than turbos. 3. Commercial Vehicle Recovery: Analysts sought clarity on 'green shoots.' Management noted signs of stabilization in China and the bottoming of the cycle in agricultural/construction equipment (off-highway).	Total Net Sales: +9% reported (+6% at constant currency); Light Vehicle Gasoline: +10% (driven by share gains and new launches); Light Vehicle Diesel: Reported as 'strong performance' in Europe and North America; Aftermarket: Reported as 'weak' with lower demand, particularly in North America commercial vehicle/off-highway segments; Stationary Power/Industrial: Reported double-digit growth, on track for >$100M in 2025 sales.

Transcript Tidbits2 rows

2026-02-19

About Expanding Eligible Market	About Competition	About The Broader Industry	Where Things Are Headed	Updates On Theme	Broader Themes Emerging	Bullish-Leaning Quotes (Short)	Bearish-Leaning Quotes (Short)	Hiring
Garrett is aggressively expanding into the industrial sector through a strategic collaboration with Trane Technologies to integrate oil-free, high-speed centrifugal compressors into commercial HVAC and data center applications. The E-Cooling portfolio spans 7 to 500 tonnes of capacity, addressing needs in battery energy storage and hyperscale data centers. Industrial cooling is expected to scale to over 5% of total revenue by 2030. Additionally, the company secured its first series production awards for its largest turbo frame size (MEG) and is seeing significant growth in stationary power generation for data centers, which exceeded $100 million in 2025.	Management reported a consistent win rate of over 50% for new turbocharger business awards over the last six years, reinforcing their 'last man standing' position in diesel. In the cooling space, Garrett's technology demonstrated 10% real-world energy savings compared to incumbent solutions. The company is also winning E-Cooling contracts in China, which they describe as the most competitive market globally, proving their ability to deliver performance at a cost-effective price point.	The broader automotive industry faces a projected 2% decline in global light vehicle production for 2026, with BEV penetration expected to reach 19%. There is a structural shift in the HVAC industry toward ultra-low global warming potential refrigerants, which favors Garrett's high-efficiency centrifugal technology. Data center growth is a primary macro driver for both power generation (gensets) and cooling infrastructure.	For 2026, Garrett guides for net sales of $3.7 billion and an adjusted EBIT margin of 14.7%. Strategic focus is shifting heavily toward zero-emission technologies and industrial cooling, which now receive 50% of RD&E investment. Series production for heavy-duty electric axles (E-Powertrain) is slated for early 2027. The company plans to maintain a disciplined capital allocation, targeting a 75% distribution of adjusted free cash flow to shareholders through dividends and a new $250 million share repurchase program.	Big	Automotive-to-Industrial technology transfer; Data center infrastructure boom (cooling and backup power); Energy efficiency in power-intensive environments.	Our technology can deliver more than 10% real world energy savings compared to incumbent solution.; Industrial cooling... expected to scale quickly to more than 5% of our revenue by the end of the decade.; Yes, it is accretive.; We continue to win greater than 50% of our new Turbo business awards.	2% decline of the global light vehicle industry.; Unfavorable pricing, net inflation and product mix.; Continued weakness in aftermarket.; Gasoline volumes declined outside of Europe, particularly in Asia.

2025-10-23

About Expanding Eligible Market	About Competition	About The Broader Industry	Where Things Are Headed	Updates On Theme	Broader Themes Emerging	Bullish-Leaning Quotes (Short)	Bearish-Leaning Quotes (Short)	Hiring
Garrett is expanding into stationary power generation for data centers, with sales expected to exceed $100 million in 2025. They are also moving into the industrial sector with oil-free centrifugal high-speed E-Cooling compressors for rooftop air conditioning and data center cooling, leveraging automotive-scale technology for industrial applications.	The company continues to win over 50% of new turbocharger business awards, a trend maintained over the last five years. Management describes Garrett as the 'last man standing' in the diesel turbo market and notes that their E-Compressor technology provides significant efficiency gains when tested against current industrial technologies.	The automotive industry forecast for the second half of 2025 has improved, though there is a noted slowdown in BEV passenger vehicle growth in North America and Europe. Conversely, the electric truck industry in China is growing. The aftermarket segment is currently experiencing weakness due to destocking in the commercial vehicle off-highway sector.	Garrett is targeting $1 billion in zero-emission technology revenue by 2030. Their E-Powertrain technology is scheduled for series production and ramp-up starting in 2027. The company is committed to returning 75% of adjusted free cash flow to shareholders, evidenced by a 33% dividend increase to $0.08 per share for Q4 2025.	Big	Data center infrastructure (specifically backup power and cooling) is emerging as a significant non-automotive growth vertical. There is also a trend of 'automotive-to-industrial' technology transfer, where high-speed rotating technologies developed for vehicles are being applied to industrial HVAC and power systems.	We continue to win greater than 50% of our new Turbo business awards; Sales of these products [gen sets] are expected to exceed $100 million in 2025; Board of Directors just approved a 33% [increase] in our dividend.	Continued weakness in aftermarket, primarily in North America; Impact of newly implemented tariffs drove a 20 basis point decline in the margin rate; Unfavorable mix driven by the strength in light vehicle gasoline applications.

Earnings Results3 rows

Garrett successfully returned to positive constant currency growth, hitting the low end of the rerating target. This was driven by gasoline share gains and the

Metric	Prior Quarter	Rerating Trigger	Actual Reported	Hit Target?	Notes
Net Sales (Constant Currency)	-9%	A return to positive growth in the range of +1% to +3% (Constant Currency). This requires outperforming global light vehicle production by 400-500 bps, stabilizing the high-margin aftermarket segment, and showing stationary power/industrial sales scaling toward a $150M+ annual run rate for 2026.	$891 million (1% y/y constant currency growth)	Yes	Garrett successfully returned to positive constant currency growth, hitting the low end of the rerating target. This was driven by gasoline share gains and the scaling of stationary power (data center) sales, which exceeded $100 million in 2025. This performance significantly outperformed the broader light vehicle industry, which management expects to decline by 2% in 2026.
Commercial Vehicle Revenue	-11.3%	A return to positive year-over-year growth (0% to +3%), representing a ~1,100-1,400 bps improvement from the current -11.3%. Investors need to see this growth coupled with a sequential stabilization in China CV wholesale data to confirm the 'green shoots' thesis and the end of the destocking cycle.	Positive growth reported (y/y)	Yes	Management confirmed that Commercial Vehicle and Diesel segments experienced growth in Q4, driven by off-highway and industrial turbo applications (gensets). This reversal from the double-digit declines in previous quarters validates the 'green shoots' recovery thesis and helps offset the lower-margin gasoline mix.
Adjusted EBITDA	-13.2%	To trigger a rerating, Garrett Motion needs to reverse the recent -13.2% year-over-year decline in Adjusted EBITDA and achieve a margin threshold of 17.5% to 18.0%. Specifically, the market is looking for absolute Adjusted EBITDA growth of 5%+ year-over-year, supported by stationary power (data center) revenue exceeding a $150 million annual run rate and a stabilization of high-margin aftermarket sales to offset lower-margin gasoline turbo growth in China.	$122 million Adjusted EBIT (13.7% margin, -100 bps y/y)	No	The company missed the 17.5%-18.0% margin target. Adjusted EBIT margin fell 100 basis points year-over-year to 13.7%, pressured by an unfavorable product mix (higher gasoline volume vs. lower aftermarket) and a 20 basis point headwind from tariffs. While absolute EBIT was in line with full-year guidance, it did not achieve the expansion required for a valuation rerating.

NotesTable

Date	Comment	Comment Type	Comment Sentiment	Link	IS CHANGE	Price Reaction
2026-02-19	Garrett Motion delivered strong 2025 results and a positive 2026 outlook, highlighted by a landmark industrial cooling partnership with Trane Technologies for data centers. Despite guiding for margin expansion to 14.7%, the stock dropped 6.4%, underperforming the SPY. Investors likely reacted to cautious 2026 volume guidance (2% industry decline) and persistent headwinds from an unfavorable, lower-margin gasoline product mix.	Earnings Transcript	Bearish	https://investors.garrettmotion.com/	False	-6.39% (vs SPY: -6.13%)