Lear Raises Share Repurchase Authorization to $1.5 Billion Through End of 2029
Key Facts
Lear said in its third-quarter results announcement that it had about $1.5 billion remaining under its share repurchase authorization, after its board approved an increase to the authorization on September 24 and extended it through December 31, 2029. That balance does not mean the company has spent the amount or will repurchase all the shares immediately; it is the limit available under the authorization. The company said the remaining balance at the end of the third quarter was equivalent to about 26% of its market value at the time. It had about $600 million remaining under the previous authorization at the end of the second quarter, before the increase and extension. The announcement places the buyback in the context of quarterly results showing higher earnings and earnings per share, alongside lower free cash flow and reduced annual sales expectations.
The company reported sales of $5.773 billion in the third quarter of 2026, compared with $5.6798 billion in the same period of 2025, an increase of about 2% year over year. Net income rose to $136.6 million from $108.2 million, while adjusted earnings per share increased to $3.71 from $2.79. Lear attributed sales growth to new business and commercial recoveries, which offset lower production in some of its major programs. The end of non-core electronics programs also limited revenue growth. These factors show that earnings improved in a quarter when the company faced pressure on production volumes and some business lines.
Global vehicle production fell 2% year over year in the third quarter, according to Lear data. Production declined 5% in North America and 7% in China, while rising 1% in Europe. The company’s estimate in its second-quarter outlook had assumed that global industry production would decline about 2% in 2026 compared with 2025, weighted by Lear sales. On the earnings call, the company said it had reduced the midpoint of its revenue outlook by about $225 million from its previous forecast, citing lower production in its programs, particularly in China, and the impact of foreign exchange rates. It added that supplier cost pass-throughs and commercial recoveries partly limited the impact of those pressures.
On liquidity, free cash flow was $158 million in the third quarter, compared with $307 million in the year-earlier quarter. In the second quarter of 2026, Lear repurchased 735,873 shares for $100 million, and had about $600 million remaining under the authorization at the end of that quarter. This comparison helps distinguish the available authorization from repurchases actually executed. The company said in its results that strong cash flow had enabled it to meet its annual repurchase target, but its third-quarter statement reported a decline in free cash flow from a year earlier. Since launching its repurchase program in 2011, Lear said it had repurchased 64.9 million shares for a total of $6.3 billion, reducing shares outstanding by about 62% through the end of the third quarter of 2026.
The company is also betting on automation at its seating facility in Orion, Michigan, where it expects production to begin in early 2027. Its chief executive said the facility will support three major General Motors models: Cadillac Escalade, Chevrolet Silverado and GMC Sierra. Lear expects automation to reduce the facility’s conversion cost requirements by 10% to 15%. It said Orion will be a "prototype" that it plans to expand across its global seating business. This goal places cost reduction within the facility’s future plan; it does not mean the technology has already been expanded across all of the company’s operations.
For the rest of 2026, Lear lowered its sales outlook range to $23.35–$23.75 billion, while maintaining its core operating earnings range at $1.08–$1.20 billion. The chief financial officer said the company expects to continue monitoring the domestic Chinese market for the rest of the year, as consumer demand and production schedules deteriorate, and that it left its full-year core operating earnings outlook unchanged. The company said it had increased its restructuring cost estimate by $25 million. Lear shares closed at $117.38 on October 29, 2026. The company’s guidance combines a lower sales outlook with an unchanged core operating earnings range, while the repurchase authorization extended through the end of 2029 remains available for execution.