Garrett Motion tops earnings estimates as gross margin hits 22.2%
As seen on the 24/7 Wall St. homepage on October 29, 2026.
Margins are carrying Garrett: gross margin expanded to 22.2% from 20.6% on mix, productivity and pricing, enough to beat on earnings even as revenue came in missing expectations. Management narrowed full-year sales guidance to $3.75 billion to $3.85 billion and the board authorized a new $250 million buyback for 2027.
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Garrett Motion posted Q3 2026 GAAP EPS of $0.51, beating expectations for a fifth straight quarter, while revenue of $930 million came in just shy of consensus on softer gasoline turbo demand from China.
Gross margin expanded to 22.2% from 20.6% a year earlier on favorable product mix, net productivity gains, better pricing, and lower import tariff costs. That lifted earnings above expectations even as the top line fell short.
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Adjusted free cash flow climbed to $136 million from $107 million a year earlier, and the company made a $50 million voluntary early repayment on its Term Loan in October 2026. Management narrowed full-year net sales guidance to $3.75 billion to $3.85 billion while reaffirming its adjusted free cash flow outlook.
The board authorized a new $250 million share repurchase program for calendar year 2027, beginning after the current program expires on December 31, 2026. Garrett repurchased $57 million of stock in Q3, leaving $78 million of capacity. Narrowed guidance plus a fresh buyback signals management sees the productivity gains holding.
Mentioned: GTX