Dauch Expects Loss of Up to $47 Million, Cuts 2026 Adjusted Earnings Target
Key Facts
Dauch reported preliminary results on October 30 for the quarter ended September 30, 2026, forecasting a net loss attributable to the company of between $42 million and $47 million and adjusted EBITDA of between $355 million and $360 million. The figures came in a filing that included mixed changes to its full-year targets, as the company lowered its adjusted earnings target and raised its sales target. Dauch said the results remain preliminary because closing procedures, review and internal controls are not complete. Final results could therefore change before they are officially released. The company is scheduled to report full quarterly results on November 6.
Dauch lowered its full-year adjusted earnings target to $1.350–$1.375 billion, from the previous range of $1.360–$1.425 billion. The revision reduced both the lower and upper ends of the target, while final performance for 2026 remains subject to completion of the year. By contrast, the company raised its sales forecast to $10.8–$10.875 billion from $10.6–$10.8 billion. The new sales target includes the pass-through of metal prices, putting the announced increase in context. The forecast update therefore does not represent a broad reduction in targets: the cut applies to adjusted earnings, while the revenue target rose.
The company attributed pressures expected in the fourth quarter to production volatility among some customers, as well as higher inflation and energy costs. In its filing, it said the factors include "production volatility among some customers, higher inflation, and increased energy costs." Reliance on customer production levels makes fluctuations in automakers' activity a factor in the supplier's outlook, alongside operating costs. Dauch also said the range for its adjusted free cash flow target would be narrowed toward the midpoint of its previously announced range. The company did not specify a new numerical range for the target in the filing.
The updated forecasts for vehicle production in 2026 are based on about 15.0 million vehicles in North America, 17.2 million in Europe, 31.0 million in China and 91.6 million globally. After its second-quarter results, the company's assumptions had been about 15.1 million in North America, 16.9 million in Europe, 31.6 million in China and 91.1 million globally. Dauch therefore lowered its assumptions for North America and China, and raised them for Europe and the global total. These figures provide context for its updated outlook in a sector where suppliers' activity is tied to vehicle production levels. The company said in its second-quarter statement that Dowlais contributed partially to 2026 results after consolidation began following completion of the business combination on February 3.
Second-quarter results showed a contrast between sales growth and a stable adjusted earnings margin: sales were $2.96 billion, compared with $1.54 billion in the same period of 2025, while adjusted earnings were $389.6 million, compared with $202.1 million. Adjusted earnings were 13.2% of sales in both periods, according to the company statement. But net income attributable to Dauch in the second quarter of 2026 was $1 million, compared with $39.3 million a year earlier, and adjusted earnings per share fell to $0.32 from $0.34. For the first half, the company posted a net loss of $99.3 million, compared with income of $46.4 million in the first half of 2025. The company linked a major part of the year-over-year change to the Dowlais acquisition, which began affecting results after the combination.
Dauch's outlook issued after the second quarter included adjusted free cash flow of between $260 million and $325 million and synergies included in adjusted earnings of between $60 million and $75 million. The latest update indicated that the free cash flow range would be narrowed toward the midpoint of the previous range, without announcing new numerical bounds. The company defines adjusted earnings as a measure that excludes restructuring, acquisition and debt refinancing costs and certain other items; it is a non-GAAP measure. Full results are expected to clarify how these items affected the final figures. The company will report third-quarter results before the market opens on November 6, with its investor call starting at 10:00 a.m. Eastern time, or 15:00 GMT.