The EPS beat and raised guidance are positive, but the revenue decline and narrowed sales guidance due to lower industry production temper the outlook. The $864M debt reduction and continued buybacks signal balance sheet discipline. Monitor Q4 for further production volume trends and Battery Energy Systems segment trajectory.
Price Chart
Executive Summary
BorgWarner reported Q3 2026 adjusted EPS of $1.39, beating consensus of $1.25 by 11.2%, while net sales of $3.487B declined 2.9% YoY and slightly missed the $3.49B consensus. The company narrowed its full-year 2026 net sales guidance range to $14.0B-$14.2B (from $14.0B-$14.3B) due to lower industry production expectations, but raised its adjusted EPS guidance to $5.20-$5.35 (from $5.05-$5.30) driven by share repurchases and a lower effective tax rate.
Key Financial Metrics
Key Facts
- Q3 2026 adjusted EPS of $1.39, up 12.1% YoY from $1.24, beating consensus of $1.25
- Q3 2026 net sales of $3.487B, down 2.9% YoY from $3.591B, slightly below consensus of $3.49B
- Organic net sales declined 3.1% YoY in Q3 2026
- Full-year 2026 net sales guidance narrowed to $14.0B-$14.2B from $14.0B-$14.3B
- Full-year 2026 adjusted EPS guidance raised to $5.20-$5.35 from $5.05-$5.30
- Company reduced gross debt by $864M via debt tender and make-whole redemption in Q3
- Repurchased approximately $175M of shares and paid $35M dividend in Q3
- Q3 2026 GAAP operating margin improved 180 bps YoY to 8.7%; adjusted operating margin was 10.9%
- Battery Energy Systems segment sales declined 40.9% organically YoY to $78M
- PowerDrive Systems segment grew 19.6% organically YoY to $705M
Financial Impact
Q3 adjusted EPS beat consensus by $0.14 (11.2%); full-year adjusted EPS guidance raised by $0.15 at midpoint; net sales guidance narrowed by $50M at midpoint
Segment Breakdown
| Segment | Revenue | Growth |
|---|---|---|
| Turbos Thermal Technologies | $1.4B | -4.4% |
| Drivetrain Morse Systems | $1.3B | -7.4% |
| PowerDrive Systems | $705.0M | +19.6% |
| Battery Energy Systems | $78.0M | -40.9% |
Risk Factors
- Net sales declined 2.9% YoY with organic sales down 3.1%, reflecting lower industry production volumes
- Battery Energy Systems segment sales continued to decline sharply (down 40.9% organically YoY)
- Full-year net sales guidance narrowed at the high end due to lower industry production expectations
- Restructuring expenses of $50M in Q3 and elevated non-comparable items totaling $79M pretax
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 6 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 8-K Filing (Primary) | 0000908255-26-000060 |
| Document: bwa-20261029.htm | 0000908255-26-000060 |
| Document: 0000908255-26-000060-index-headers.html | 0000908255-26-000060 |
| Document: 0000908255-26-000060-index.html | 0000908255-26-000060 |
| Document: 0000908255-26-000060.txt | 0000908255-26-000060 |
| 8-K Data (Synthetic) | 0000908255-26-000060 |
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Oct 29, 2026 1d ago | 8-K | No price | awaiting T+5 | awaiting T+5 | No price |
Oct 29, 2026 1d ago | Press Release | $53.30 | awaiting T+5 | awaiting T+5 | $51.63 (−3.13%) |
Sep 22, 2026 5w ago | Press Release | $60.55 | awaiting T+5 | awaiting T+5 | $51.63 (−14.73%) |
Sep 1, 2026 8w ago | Insider Cluster | $63.54 $65.26 | ▲ +2.71% | ▲ +2.63% | $51.63 (−18.74%) |
Aug 25, 2026 9w ago | Insider Cluster | $65.10 $63.54 | ▼ −2.40% | ▼ −1.86% | $51.63 (−20.69%) |
Aug 20, 2026 10w ago | Insider Cluster | $67.78 $64.09 | ▼ −5.44% | ▼ −5.92% | $51.63 (−23.83%) |
Aug 20, 2026 10w ago | Insider Cluster | $64.80 $64.80 | · 0.00% | ▼ −1.11% | $51.63 (−20.32%) |
Aug 18, 2026 10w ago | Insider Cluster | $67.95 $65.10 | ▼ −4.19% | ▼ −3.99% | $51.63 (−24.02%) |
Aug 10, 2026 11w ago | 8-K | $69.28 $69.90 | ▲ +0.89% | ▲ +0.94% | $51.63 (−25.48%) |
Aug 5, 2026 12w ago | 8-K | $66.34 $68.85 | ▲ +3.78% | ▲ +3.43% | $51.63 (−22.18%) |
US Market Status
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