Gentherm lifts 2026 revenue guidance to $1.825 billion to $1.925 billion as Modine joins

Gentherm posted third-quarter 2026 product revenue of $405.1 million, up 4.7% from $386.9 million a year earlier, and lifted full-year revenue guidance to $1.825 billion to $1.925 billion to include Modine Performance Technologies, the business it combined with on October 1.

Automotive Climate and Comfort Solutions, the largest segment, grew 8.8% year over year, or 8.5% excluding foreign currency translation, which the release says outperformed S&P Global's mid-October light vehicle production report for Gentherm's relevant markets by 12 percentage points. The company booked $555 million of automotive new business awards in the quarter, and Medical segment revenue also increased.

Margins fall even as revenue grows

Gross margin was 23.3%, against 24.6% a year earlier, a decline the release attributes primarily to foreign exchange, higher net material costs and inflation, partly offset by operating leverage. Adjusted EBITDA was $45.0 million, or 11.1% of revenue, compared with $49.0 million, or 12.7% of revenue, in the prior year. Adjusted diluted earnings per share fell to $0.33 from $0.73, a 54.8% decline. On a GAAP basis the quarter swung to a loss. The release said: "Net (loss) income was $(2.6) million, compared to $14.9 million in the prior year."

The accompanying income statement, which is presented in thousands of dollars, shows how a modest operating profit became a loss: operating income fell to $14.36 million from $23.86 million, while income tax expense rose to $13.43 million from $5.94 million and exceeded earnings before income tax of $10.84 million. Merger and acquisition expenses of $6.53 million and restructuring charges of $4.84 million also ran through operating expenses.

The raised range is mostly Modine, not momentum

Full-year 2026 product revenue guidance moved to $1.825 billion to $1.925 billion from $1.55 billion to $1.65 billion in July, adjusted EBITDA guidance rose to $210 million to $230 million from $185 million to $200 million, and adjusted free cash flow guidance rose to $100 million to $120 million from $85 million to $100 million.

The increase is largely a change of perimeter rather than a stronger base business. The release says the update reflects the expected contribution from Modine Performance Technologies in the fourth quarter, and Gentherm began consolidating that business on October 1. Nine-month product revenue was $1.21 billion, so the new range leaves $610 million of revenue at the low end and $710 million at the high end for the fourth quarter alone, far above the $405.1 million delivered in the third quarter. The guidance footnote assumes tariffs in effect as of October 22, light vehicle production in Gentherm's relevant markets falling at a low single-digit rate for the year, and a euro at $1.15.

Buybacks, a special dividend and a nine-month cash figure

Capital returns have already absorbed part of the transaction's effect. Gentherm paid a special cash dividend of $2.07 a share, $63.5 million in total, on October 7, and has repurchased $60 million of stock since closing, leaving about $340 million of the $400 million authorization the board approved in July. Liquidity was $494.2 million at September 30.

Chief Financial Officer Jon Douyard said the "current share price does not reflect the value of the Company" and that "Since closing, we have repurchased $60 million and we remain committed to returning capital to shareholders, particularly in times of value dislocation."

A labeling caveat is worth stating. The highlights cite cash flow from operations of $36.0 million against $87.8 million, and adjusted free cash flow of $59.5 million against $72.3 million, without a period label. The cash-flow statement shows both pairs are nine-month figures; for the quarter alone, operating cash flow was $33.74 million and adjusted free cash flow $43.65 million. Last year's third-quarter release described its $87.8 million as year-to-date cash flow, which supports that reading.

The first combined quarter is the test

The fourth-quarter and full-year 2026 results will be the first report to include a full three months of Modine Performance Technologies, and the implied $610 million to $710 million revenue band is the clearest yardstick for it. The release does not break out how much revenue or adjusted EBITDA Modine is expected to add in that quarter, and it gives no quarterly guidance, so the split between acquired and organic growth will stay invisible until segment detail is published. Gentherm holds its conference call at 8:00 am Eastern today, and a telephonic replay will run until November 5, 2026.