NYSE:LEA
LEAR CORP
A global provider of automotive interior systems and thermal management components with strong cash flow generation.
Key Metrics
Investment Thesis
Bull Case
LEA is well-positioned to capitalize on the global electrification trend, where its thermal management expertise offers a clear growth tailwind as vehicle architectures shift away from internal combustion engines. The company's strong balance sheet with $1.03B in cash and low leverage provides ample flexibility for strategic acquisitions or R&D investment without compromising financial stability.
Bear Case
Valuation may be challenged if automotive production volumes contract significantly, as evidenced by the flat revenue trend over the last two years compared to 2023 highs. The substantial retained earnings deficit of $6.19B suggests a history of aggressive reinvestment or past distress that warrants careful monitoring of future profitability trends.
About LEAR CORP
LEAR Corp (LEA) is a global leader in automotive interior systems and thermal management solutions, serving major original equipment manufacturers (OEMs) worldwide. The company designs, engineers, manufactures, and supplies high-quality components for vehicles across all segments, including sedans, SUVs, trucks, commercial fleets, and electric vehicles. With operations spanning the Americas, Europe, Asia-Pacific, and Latin America, LEA plays a critical role in vehicle safety, comfort, and efficiency.
Analysis
Management Discussion
Despite a slight year-over-year decline in net income from $591.8M in 2024 to $527.1M in 2025, revenue remained relatively stable at $23.26B, indicating resilient demand. The company generated robust operating cash flow of $1.09B, which supported significant capital expenditures of $561.6M and shareholder returns including $325.2M in buybacks and $164.8M in dividends.
Industry Overview
The automotive aftermarket and Tier 1 supplier industry is characterized by high barriers to entry, intense competition, and sensitivity to global economic cycles and inventory levels. Companies must continuously invest in technology and manufacturing capacity to meet OEM demands for safer, lighter, and more efficient vehicles in a rapidly evolving regulatory landscape.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue | $20.89B | $23.47B | $23.31B | $23.26B |
| Cost of Revenue | $19.48B | $21.76B | $21.67B | $21.75B |
| Gross Profit | $1.41B | $1.71B | $1.64B | $1.50B |
| Operating Expenses | $755.6M | $777.2M | $751.6M | $727.1M |
| Operating Income | $654.3M | $933.2M | $887.7M | $777.3M |
| G&A | $684.8M | $714.7M | $702.5M | $707.6M |
| Stock-Based Comp | $52.0M | $67.5M | $64.4M | $66.2M |
| D&A | $576.5M | $604.4M | $620.7M | $604.1M |
| Depreciation | $505.7M | $541.9M | $571.6M | $584.6M |
| Amortization | $70.8M | $62.5M | $49.1M | $19.5M |
| Other OpEx | $70.8M | $62.5M | $49.1M | $19.5M |
| Non-Operating Income | $-145.0M | $-156.0M | $-154.8M | $-152.2M |
| Interest Expense | $98.6M | $101.1M | — | — |
| Pre-Tax Income | $509.3M | $777.2M | $732.9M | $625.1M |
| Income Tax | $133.7M | $180.8M | $191.1M | $150.0M |
| Continuing Ops | $375.6M | $596.4M | $541.8M | $475.1M |
| Discontinued Ops | $33.1M | $49.3M | $50.0M | $52.0M |
| Net Income | $408.7M | $645.7M | $591.8M | $527.1M |
| Minority Interest | $81.0M | $73.2M | $85.2M | $90.3M |
| Net to Common | $327.7M | $572.5M | $506.6M | $436.8M |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Current Assets | $6.99B | $7.64B | $7.18B | $7.66B |
| Cash & Equivalents | $1.11B | $1.20B | $1.05B | $1.03B |
| Marketable Securities | $3.6M | — | — | — |
| Accounts Receivable | $3.45B | $3.68B | $3.59B | $3.90B |
| Inventory | $1.57B | $1.76B | $1.60B | $1.69B |
| Other Current Assets | $850.1M | $1.00B | $940.8M | $1.03B |
| Long-Term Assets | $6.77B | $7.06B | $6.84B | $7.18B |
| PP&E (Net) | $2.85B | $2.98B | $2.83B | $2.91B |
| Goodwill | $1.66B | $1.74B | $1.70B | $1.78B |
| Operating Leases | $701.8M | $733.5M | $699.8M | $722.4M |
| LT Securities | $53.6M | — | — | — |
| Other LT Assets | $1.30B | $1.39B | $1.39B | $1.53B |
| Total Assets | $13.76B | $14.70B | $14.03B | $14.84B |
| Current Liabilities | $5.19B | $5.67B | $5.45B | $5.67B |
| Accounts Payable | $3.21B | $3.43B | $3.25B | $3.42B |
| Current Leases | $136.8M | $151.9M | $152.6M | $169.4M |
| Other Current Liab | $-116.1M | $-124.1M | $-123.7M | $-137.8M |
| Long-Term Liabilities | $3.74B | $3.97B | $3.98B | $3.98B |
| LT Operating Leases | $595.1M | $623.0M | $582.5M | $594.9M |
| Other LT Liab | $3.15B | $3.34B | $3.40B | $3.38B |
| Total Liabilities | $8.93B | $9.63B | $9.43B | $9.64B |
| Shareholders' Equity | $4.83B | $5.06B | $4.60B | $5.20B |
| Paid-In Capital | $1.02B | $1.05B | $1.08B | $1.11B |
| Retained Earnings | $5.21B | $5.60B | $5.93B | $6.19B |
| AOCI | $-805.1M | $-688.8M | $-1.13B | $-544.3M |
| Total L&E | $13.76B | $14.70B | $14.03B | $14.84B |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Net Income (CFO) | $408.7M | $645.7M | $591.8M | $527.1M |
| Non-Cash Adjustments | $-465.3M | $15.7M | $536.5M | $384.9M |
| Working Capital Changes | $1.08B | $587.9M | $-8.2M | $176.8M |
| Cash from Operations | $1.02B | $1.25B | $1.12B | $1.09B |
| Capital Expenditures | $638.2M | $626.5M | $558.7M | $561.6M |
| Cash from Investing | $-830.3M | $-761.5M | $-543.0M | $-516.8M |
| Debt Repayments | — | — | $50.0M | $50.0M |
| Share Buybacks | $100.3M | $296.5M | $416.7M | $325.2M |
| Dividends Paid | $185.5M | $181.9M | $173.7M | $164.8M |
| Cash from Financing | $-387.3M | $-419.5M | $-693.9M | $-618.5M |
| FX Effect | $-7.7M | $12.8M | $-26.3M | $26.4M |
| Net Change in Cash | $-203.9M | $81.1M | $-143.1M | $-20.1M |
| Beginning Cash | $1.32B | $1.12B | $1.20B | $1.06B |
| Ending Cash | $1.12B | $1.20B | $1.06B | $1.04B |
Frequently Asked Questions
How does LEAR CORP make money?
The company operates primarily through three core segments: Automotive Interiors, which covers seating, roof systems, instrument panels, and door modules; Thermal Systems, focusing on climate control and battery cooling solutions for electrified vehicles; and Lighting, providing exterior and interior lighting technologies. Revenue of $23.26B in 2025 reflects the scale of these diversified automotive supply chains.
What are the main risks for LEA?
Significant exposure to fluctuations in raw material prices such as steel and aluminum can impact margins given the high cost of revenue relative to gross profit. The automotive industry faces cyclical demand risks and potential slowdowns due to macroeconomic factors affecting consumer spending on new vehicles. Intense competition from other Tier 1 suppliers and emerging Chinese manufacturers could pressure pricing power and market share.
What is LEA's competitive advantage?
LEA benefits from deep customer relationships with top global OEMs, enabling long-term contracts that provide revenue visibility. The company's extensive engineering capabilities allow for rapid innovation in lightweighting and electrification technologies, creating a high barrier to entry for new competitors. Additionally, its global manufacturing footprint provides supply chain resilience and cost optimization opportunities.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.