Lear beats on third-quarter earnings, misses on sales and lifts its buyback to $1.5bn

The supplier raised its full-year net sales range to $23,350m to $23,750m but left its core operating earnings range at $1,080m to $1,200m.

Lear's third quarter was a profit story, not a sales one. Earnings per share came in at $3.71, $0.31 ahead of expectations, while revenue of $5.77bn fell short of the $5.87bn analysts had expected.

The full-year sales range was raised, to $23,350m to $23,750m, but the core operating earnings range stayed at $1,080m to $1,200m. The company also guides to adjusted EBITDA of $1,700m to $1,820m and free cash flow of $565m to $665m. A higher sales range with an unchanged earnings range is not a sign of stronger profit ahead, and a revenue miss in the quarter makes the sales upgrade harder to read as momentum.

Ray Scott, the chief executive, said the results keep Lear on track to meet its full-year earnings guidance despite lower industry production, helped by new business wins and restructuring savings. That is the backdrop against which the revenue shortfall sits. Cost cuts and contract wins are carrying the earnings line while the market for vehicles gives little help.

The buyback is where the company is most forthcoming. Lear expanded its share repurchase authorization to $1.5bn and extended it through December 31, 2029, giving it a long runway to return capital. An authorization is a ceiling, not a purchase, so what matters is how much Lear actually buys, and whether free cash flow in the range it has set can fund that alongside the business.