\nPHINIA Inc. (NYSE: PHIN), (\u201cPHINIA\u201d, or the \u201cCompany\u201d), a diversified industrial supplier and global leader in the development of fuel systems, electrical systems, and aftermarket solutions, today reported results for the third quarter ended September 30, 2026.<\/p>\n
THIRD QUARTER 2026 HIGHLIGHTS:<\/b><\/p>\n
(all comparisons versus the prior-year period)<\/i><\/p>\n \n\u201cOur third quarter results were consistent with our expectations and reflect stable end market demand, continued aftermarket momentum, and strong financial discipline,\u201d said Brady Ericson, President and Chief Executive Officer of PHINIA. \u201cWe generated another quarter of profitable growth, with Adjusted EBITDA increasing $2 million, or 20 bps, despite higher R&D spending and investments in customer relationships, demonstrating the resilience of our business and consistent execution. Based on our solid third quarter results and the continued business momentum, we are updating our fiscal 2026 financial guidance.<\/p>\n \n\u201cWe made further progress on our key strategic priorities during the quarter, highlighted by strong new award activity in targeted growth markets and consistent execution on our disciplined capital allocation strategy. Our business momentum continued into the third quarter, as we delivered strong new award activity, with awards focused on emerging growth industries. Importantly, we returned $76 million of capital to shareholders during the quarter, which represents 104% of adjusted free cash flow, and we remain committed to our balanced capital allocation strategy, which is focused on investments for growth, strategic acquisitions, and capital returns.<\/p>\n \n\u201cWe are focused on building a diversified growth business, driven by strong product leadership, expansion into growth markets, product innovation, and disciplined financial execution. Our strong new business momentum and consistent financial results are evidence our strategy is working. We remain committed to our strategic framework and confident in our ability to execute on our key priorities, all with a focus on delivering value for our shareholders,\u201d concluded Ericson.<\/p>\n CONSOLIDATED FINANCIAL RESULTS<\/b><\/p>\n \nPHINIA delivered third quarter net sales of $912 million, an increase of 0.4% when compared to the prior-year period. Excluding the impact of foreign currency of $4 million, net sales remained flat year over year. Results in both periods were impacted by tariff-related customer recovery mechanisms. Third quarter 2025 benefitted from net sales associated with tariff cost recoveries, while third quarter 2026 reflected reductions in net sales related to tariff cost refunds to be returned to customers. Excluding the effects of this tariff-related volatility, core business sales increased $21 million year-over-year. Power Systems net sales declined 1.8% to $561 million primarily reflecting the non-recurrence of favorable customer pricing actions realized in the prior year and the timing of tariff recovery mechanisms with customers. Aftermarket Solutions net sales increased 4.2% to $351 million driven by higher sales in the Americas, partially offset by the timing of tariff recovery mechanisms with customers.<\/p>\n \nThe Company reported net earnings of $67 million, and Adjusted EBITDA of $135 million. The year-over-year increase in Adjusted EBITDA was driven primarily by higher sales volume in the Americas and the favorable timing of tariff recovery mechanisms, partially offset by increased R&D investment and the non-recurrence of favorable customer pricing actions realized in 2025. Adjusted EBITDA margin increased 20 basis points year-over-year to 14.8%, primarily reflecting the timing of tariff recovery mechanisms.<\/p>\n BUSINESS UPDATE<\/b><\/p>\n \nDuring the third quarter of 2026, PHINIA continued to advance its multi-year value creation strategy across its commercial, operational, and capital allocation priorities. The following highlights key progress achieved during the three months ended September 30, 2026.<\/p>\n Commercial Update<\/i><\/p>\n \nPHINIA secured several new business awards and expanded its global distribution reach, including the following:<\/p>\n BALANCE SHEET AND CASH FLOW<\/b><\/p>\n \nAs of September 30, 2026, PHINIA had total cash and cash equivalents of $436 million and $377 million of availability under its Revolving Credit Facility, resulting in total available liquidity of $813 million. Total debt at the end of the third quarter 2026 was $1.1 billion, with net leverage of 1.3x.<\/p>\n \nNet cash generated by operating activities was $87 million, representing a year-over-year decrease of $32 million, primary due to withholding tax payments related to cash repatriation and an unfavorable working capital impact, which was primarily driven by an increase in accounts receivable, reflecting the timing of customer collections and higher receivable balances at quarter-end. Adjusted free cash flow was $73 million, a decrease of $31 million compared to the third quarter of 2025.<\/p>\n FINANCIAL GUIDANCE<\/b><\/p>\n \nThe following forward-looking guidance reflects PHINIA\u2019S current expectations and beliefs as of October 29, 2026, and is subject to change. The following statements apply only as of the date of this disclosure and are expressly qualified in their entirety by the cautionary statements included elsewhere in this document.<\/p>\n\n
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