Aptiv (APTV) 4 May 232023 Q1 Earnings call transcript

Good day, and welcome to the Aptiv Q1 2023 Earnings Call. Today's conference is being recorded.

At this time, I would like to turn the conference over to Jane Wu, Vice President, Investor Relations and Corporate Development. Please, go ahead.

Thank you, Ally. you Aptiv's thank earnings quarter and call. conference morning for first joining XXXX Good and along portion related presentation, release press The tables, found at the website can with on Investor our Relations of aptiv.com be slide the

at as review outlook for other items back and the financials our the operations Aptiv. first and amortization, GAAP are between well continuing special The the quarter our reconciliations slide exclude our address and the Today's XXXX presentation of press of earnings restructuring included full financials year we'll non-GAAP of as measures and release.

call, be different and filings. performance, we and During in reasons forward-looking today's financial current other SEC materially be cite will XX-K for information Aptiv's that Form reflects may future that certain of view we providing our

Chairman the will and results the Joe of to Business financial today be CEO; open the CFO Senior a Aptiv's Q&A. provide business, detail in on will call more Clark, Kevin strategic Vice and and us update and Operations. President before Massaro, we Joe cover Joining will Kevin

Clark. like With Kevin over to the call I'd to turn that,

Thanks, had Jane, to few strong for and in execute year, morning. us macro continue the Touching a of the to our to a showcasing ability start highlights. X. Slide dynamic thanks, Beginning on a this environment. everyone, We joining on

product all and of X increased underlying Revenue regions for record particularly vehicle strength XX% to ASUX $X.X growth segment. over points across supported new revenue, representing in billion, quarterly a production, our by lines,

recent River Intercable by chain exchange and volume prices. unfavorable and solid disruptions on and offset and earnings growth Wind periodic $X.XX $XXX per and our respectively, from and income share reflecting partially supply foreign million Operating totaled commodity Automotive, contributions flow-through acquisitions,

the totaled vehicle. and fully solutions, as record $XX.X driven to New accelerates Architecture demonstrating for awards of level towards our business our electrified further our customers High-Voltage software-defined Smart industry value the Vehicle a strategic customer by bookings billion,

X. Slide Turning to

to beginning that challenging, line macro expectations. the broadly in overall our remains see with are improvements supply While we're environment chain

a Our XX% by in revenue America growth underlying global in the stronger-than-forecasted by production, and in Europe. driven first vehicle customer schedules North was X% increase supported quarter principally

We for as that further recent more in vehicles, stringent demand vehicles with could government electrified new the in which accelerate U.S. continue such half electric sales will least more EPA car from to feature-rich, regulations, representing result benefit consumer highly XXXX. of proposal at

issues production stable has Although we're which more now in sequential overall a translated supply persist, seeing schedules. improvements vehicle the supply of in chain semiconductors,

and tailwinds, While and on current position right long-term we work to benefit execute to focused ensuring we platforms. that future we optimizing operational our remain ourselves business talent our these near foundation, on the from to footprint and have

located expand to new our enhance our establishing which Monterrey, India centers global are Mexico, emerging model capabilities centers engineering resources execution operating in our continue regional technology and for engineering to our rotating We software Cairo, talent. Poland and in by and and hubs Egypt

material direct to model, inflation and to the our rotation We to is visibility of predict resilience locations. and manufacturing our also footprint material the into better mapped enabling providing chain impact address and us digital and chain initiatives now supply in cost majority spend The labor through of minimize greater our network best continue supply global increasing supply our constraints. of

aligned choice. road product trusted supply semiconductors that for we're better the to execution customers' partner has our maps In and our solidifying as future, a long-term ensuring positioned to for of addition, of us select reliable our agreements position strategic and secure

our of production pursuits. for and has commercial automation to initiatives, which shift with we well higher in enhanced lastly, operating best to content direct continue regions manufacturing and invest capacity labor cost position or all execution And countries us high-return

that we our track is record bookings Moving the a technologies, our the customers, value for just of strength also of of pace not a execution. portfolio advanced testament The bring but our to business of to new strong X. to Slide from true

mentioned, the quarter adopt quarterly RADAR solutions quarter Experience nearly Vehicle total of Safety cumulative As business in ADAS OEMs first active $X than Aptiv's over last optimize totaled which billion more with first to doubled of billion amount X Geely, different global a by and our to which in safety bookings global year's for new program SBA Advanced leveraging record platform, booking bookings with billion, OEM year's Japan-based ADAS up under $XX.X just represents LX+. billion. billion bookings awards system full billion, bookings, seventh and a $X driven OEM double and customer program years last $XX totaled User to Architecture $X.X Smart in X $XX.X with our last a including the to performance

electric Signal and vehicle architecture electrical a high-voltage new for product OEMs lines. high-voltage solutions bookings $X.X and our Power bookings business Solutions battery electrification new $X.X across engineered billion, and of totaled in including billion awards from traditional record components both comprised

continue line to awards. a strength in sight We and high-voltage exceed see balanced bookings clear of high-voltage providing a year's profile, last to the portfolio business our underscoring very billion of $X.X

the $XX of highly with awards for year. provider end-to-end the billion full we Further the in value pace strategic and our solutions. customers full of engagement is as remain confident deliver of in Overall, our only target the system new we achieving accelerating, only validation of business

with solutions in ramp, X with and Safety Advanced Active ADAS the experience points first $X.X line & market, Turning to record Growth X User regions as of our in achieved all strong segment was Safety revenue grew Slide our underlying quarter, consistent vehicle expectations. X highlights. the across growing ASU Experience production. to to while user billion, above of production continue In review Level X+ our

from for with vehicle award a additional zone quarter As with I global central strong business large mentioned, American-based we're new a billion awards during European-based controller. major Architecture award major North $X OEM and of the solution. Vehicle momentum commercial experiencing includes our OEM control a Smart global The an a

progress and In leveraging opportunities. at although only experienced River, support deeply February, acquisition closed into mentioned I to Wind we've we Wind the River more announced earlier. end revenue into platform in with program the offerings Geely early software automation last LX+ our success potential of Diving ADAS customer for integrated Aptiv's year, acceleration the an our engagements

off and this Aptiv vehicle both the in success of building spanning River development And local Wind selected next-generation advanced program for joint in China, River solutions major their Wind and early and suite architecture, from OEM March, full hardware software to a Aptiv. a design Chinese

automotive including Edge leadership River's XG a global to activity deployment companies, major the in of several more market, deploy, programs Wind of solution it the amount the products. there's Aerospace And are recently, industries a and year-to-date, landscape Software on new across within dozens where it provider, expand business mission-critical its Wind leading of their of cloud-native markets expansion the River example, been develop, of powers majority and other the defense for Outside these service relying and aerospace of significant serves. continues in operators. River the operate to and telecom Wind and XG tremendous telco customers commercial capabilities company's for with XG to establishing software-defined a defense further deployments

with led also where new will that telco how successfully were transforming and additional to the showcased additional increased Wind Wind XG opportunities come. platform large is confident demonstrated operators. studio River which to customer its offerings River at dialogue lead awards to O-RAN the We're World in strategic these and These global has Congress Mobile Barcelona, space, in engagements months

market all vehicle We next-gen perfectly demand architecture solutions totaled for vehicle. a partially the which outgrowth strong Slide XX% optimized on battery by by positioned in revenues, way all to the increased are regions. grid Signal and strong SPS over China X% deliver system size the X. supported of to growth costs electric quarter, Turning vehicles growth to XX%, remain driven increase Power high-voltage for from weight, Solutions total segment that during the across reflecting was the and in and

previously Power competitive new our to XXXX. Electronics The was to spanning early BEV battery charging software, American-based to And will record our with included ability quarter bookings further OEM, the management our in award our integrated used the in launch demonstrating global award system, billion across products $XXX North announced portfolio both $X.X on and high-voltage be high-voltage which moat. platforms hardware beginning million a expand an during develop

our other European key Intercable with acquisition, Automotive. launches customers. in program by Moving driven Strong key to was growth the quarter

addition, Intercable with awards, traction In in $XXX new OEMs. multiple reflecting business million and demand booked continued commercial market

capacity effectively operations now in Mexico During North the more American customers. significant serve quarter, manufacturing adding progress expanding we've to and made America Intercable in North China,

first time busbars German outside system the to Intercables As interconnects, brought portfolio. expand to technology award won making their their global and and the leader a recently technology battery. marking its in develop - first the the inside OEM, product first cell-to-cell connection high-voltage Intercable with from they continue

product increased our continuous combined innovation, year has on support in pipeline business XX% continuing new with [ph] opportunities by to funnel capabilities with of expanding grow. focus last compared global to the Aptiv manufacturing Intertables their

Moving increased solution see adoption Architecture of our we Vehicle to to on our Slide X. full continue Building approach, stack platform. Smart

today, have we electric in in architecture. further to SVA take a vehicles transitioned vehicle for concept sheet $XX is back to accelerating and for XXXX successfully from highlighted, vehicle billion in a clean introduction bookings smart of now already As cumulative compute catalyst battery a OEMs the as the providing demand approach

vehicle. have Smart translated Vehicle programs system lowering solution and To new new business of into validating date, the SVA awards, total we've programs cost and completed many unlock that the complexity, all development can multiple these our functionality, successfully of software-enabled improve scalability advanced reduce while for

in vehicle that With our modernized of and industry in both to the is the order unlock interest full The addition underlying the the must value architecture software the full after software system future. the of of seeing the a Wind for recognizing now be increased car of customers. alongside providing we're River, solution architecture from hardware hardware

faster River's world compute Solution, addressing up-integrating combined quickly Wind the River safety-critical customers truly embraced platform, enable Aptiv of and the of are cloud-enabled involves We're all Wind now which number with in the in SVA what solution, deliver. real-time the have Wind of platform serverizing OEMs in software-defined demands regarding more engaged a applications, This particularly can the can where China, vehicle. including River discussions around software move and while

new life also business DevOps and creating and reducing new The to same software lead order true architecture take customers. to will a adopt faster paradigm, hardware development, needs which to by in while full speed flexibility, OEM of advantage cycle for models increase automotive the this full costs deployment at to management, our enabled software time, approach market industry warranty

over positioned minute to call on create to the Slide Joe, to is value. I to Aptiv X reiterate turn want I how take Before uniquely a long-term

lower system technologies full that path software-defined performance advanced improve the optimized electrified solutions enable to accelerate of portfolio fully Our and to vehicle. the cost

us green to to positioned has markets. further leverage strategy opportunities Aptiv uniquely safe, is Executing megatrends. result, And the connected and as adjacent the on in our both a accelerating and positioned automotive capitalize

As our expand our moat quarter we've on a perfectly outperformance solidly shown results, first further our deliver business. and positioned commitments our and delivering XXXX well way track to fast-growing, targets we're to to meet on on financial continued more our as are XXXX competitive and in profitable

With that, detail. more to over the Joe in through turn to call now go I'll the numbers

morning, supply XX. Starting in still chain, good sequential and delivered across persist. both the reflecting Aptiv robust quarter, Kevin, first financial Thanks, in strong disruptions segments Slide results on and execution although the everyone. improvement

the program carry over was by to billion launches Growth that driven growth vehicle to expected negatively Note impact our across regions and China Europe. X% constraints above supply XX% acute excludes acquisitions. up were growth year. Revenues over production vehicle customers, without in to underlying North America and $X.X certain timing with are production high-voltage which in impacted production and was North the by safety strength American of chain vehicle active all remainder not the of or and record ASUX. a over large

margins in million manufacturing Mexican Adjusted stronger operating flow-through in $XXX a offset and million income peso costs million, points, and XXX were respectively, material by RMB. an EBITDA at and on roughly commodities quarter the that due weaker to labor OI $XXX increase XX%. impacted primarily basis increased $XX volumes reflecting negatively FX and and Higher and which performance,

growth. our Wind that And And both a results may expectations. on saw for with strong as strong A&D growth line year although posted on in Kevin quarterly end Intercable quarter, River remain telecom noted, Wind and for track and the both business be we River strong markets. lumpy basis, the full in

working an was prior Motional. Earnings by year-over-year last per was share in the an due the quarter income, of quarter. the increase investment lower losses at same partially cash which year $X.XX, to result of $XXX primarily the million, higher $X from expense were and higher period outflow of operating a million capital Operating during tax equity year, offset XX% above

million, Capital share booking activity. the expectations our in expenditures we $XX and completed launch million in $XXX And were to with line support in lastly, quarter. repurchases

the Slide on at Looking quarter revenues XX. first

of revenue across FX and lines all driven our offset the product negative of slight billion the key quarter, record price million Our $X.X growth a from by in impact positive regions, recent acquisitions. by Net reflects approximately ramp-up the the were of and commodities in $XXX headwinds. impact

From and a by earlier. program and regional increases XX% chain North of while up growth high Adjusted I was timing above American were a by ramp-up the X% perspective, continued negatively or driven noted safety voltage, in constraints impacted revenues active supply market.

Russia scale. and high vehicles points safety, Ukraine, in XX% increased revenues to over XX% market lapped for demand volumes up as In voltage strong in and by XX active part grew programs the by Europe, China, growth driven electric the In the year of safety active in battery continue prior revenues quarter. over as remains war impact

X strong Moving of on performance. as to was operating material the production. million growth flow revenues $XX margins vehicle the over up of next quarter in on a higher or manufacturing Segment or and incremental improvement points result volume through basis $XX income User million, Advanced XXX rose adjusted point and Experience year-over-year a Safety and slide. XX% in the underlying segments

basis driven and volume, totaled point Segment Signal million performance and despite incremental quarter, rose manufacturing flow-through or the from commodities, the chain the and and XX headwinds period improvements. material strong FX million XX% on operating revenues COVID improvement and a by Power income of rate points margin X above $XX in in margin market. supply $XXX lower costs

XX to outlook. Turning Slide our and XXXX macro

million that guidance which dynamics of to production. appropriately global and we reflects units continue XXXX, the our have XX reflected full current We year believe for vehicle market approximately

improvement the As our in supply challenges the customer discussed chain chain call, prior supply during and macro earnings ongoing disruptions through expect But overall impacting levels. we sequential are year. production

year full on slide. Turning outlook next our to the

As noted, guidance accordingly, unchanged our outlook year with last And is financial QX our quarter. provided results were full in from line expectations. the our

X% of revenue continue year. range up midpoint to expect We to $XX.X the to in billion prior $XX.X the on compared billion,

EBITDA Despite deliver earnings of that environment, market concerns the $X.X we about and per well midpoint, and billion respectively, the and billion operating are X% share of $X $X.XX. outgrowth macro confident income we approximately at to range in near-term the to broader positioned remain of XX%.

Turning to the next slide.

well by Our key which strong several with aligned megatrends. product outgrowth are lines, is supported accelerating of the each

Active our X platforms are to X+ chain business. with growth XX% and in Starting driving adjusted scale, continuing Despite supply XXXX. Safety disruptions, Level

next-gen solutions Aptiv investments enabling high-voltage the in continue and also meaningful to required for to our portfolio, the provide We make further data infrastructure electrification vehicle power architectures.

High-Voltage our high-voltage and interconnects. in legacy by expect grow and Automotive's to differentiated XX% portfolio We modular product strong our over then line benefiting XXXX, Intercable from further busbars driven

product XX% basis. Wind Software outside and a which on Markets our of Compute in Capital to automotive expected Vehicle this industry. growth line, forma during pro year strong reflects Day is grow and This already Smart middleware DevOps largely our the Lastly, we River's highlighted

With that, hand to his I'd back call to closing Kevin the like for remarks.

Joe. questions. wrap up I'll before the Slide Thanks, up on for line opening XX

quarter first mentioned, market our I with chain customer all to great supply tailwinds XXXX performance. strong contributing to a As and is off start

as Customer at we software full cost. Wind with by engagements for incredibly River continue optimized performance Aptiv's value increased system SVA lower providing offerings solutions are and deliver solutions strong to

laser-focused mitigating material as parts periodic resulting challenges, optimize macro said, disruptions. our to disruptions. to cost production supply on As we chain of impact we And seen inflation, remain in resiliency. improve expected, the labor improvements structure supply persistent in the That including our and of being the operational ongoing we've sequential constrained well fewer continue as

of of and momentum strategy, outperformance, commitments sustainable confident record In execute summary, we're shareholders. track drive our all creation will which in our our been experiencing for on ability commercial more and never our to tremendous maintain value deliver we've our

line now let's questions. up open the Operator, for

Evercore. you. ahead. question go ahead our McNally we'll thank from Please with course, first and [Operator Chris Of Instructions] go And take

you. Good Thank morning.

on an the production with the better if we're auto So on for two quick the obvious slide, all the you I questions call in-line starting but quarter, to full production, X guess schedule first, start it think Europe in I we [ph] sort Joe, of see year. QX,

to sort visibility the more that update So is offs Or are I the early X% in year in think of [ph] the the just in question to middle main one production, your seeing different quite is global of LMCI something and than just it you'll minus call you have maybe year? are Joe, that X%? your the too

Yes.

it's mean what were schedules in expected part for in I the QX. Chris. line think latter, we most I with the

said, of we As chain impacted us. get in a constraints supply not that by OEs related couple have I North to America, did

So we as impacted. vehicles many weren't the they But as again, They constraint, say in obviously thought. but line. I'd we overall, were didn't build

I early an schedules continue to into year. terms some as half quarter, to out our the in we view customer back Understand in you expect I May positive tied performed, the saw it's that. we QX. the to and optimism out a would be business early say customers call yes, QX. little how do in-line But of our QX in generally both that this is, and And think, at speaking, in there's a to of know, what continue But we'd point there

on production the we're shoots it seeing which specifically? Europe And regs, in that early is us Joe, on to on of fair there's Europe just follow-up, bit giving it as a the and mean side? that is sales sort a say some slight confidence little I

since last gotten, fall a sentiment the perspective the Yes. improving I of late seeing customer say, year. has ground, what and we're has on from I progressively would would been say Europe

back schedules again, in the a production the of been - last put of to we early that into really sentiment and improving a it the customer for in half our as schedules have it continues I since for little year, September, October little has we think that detailed to numbers, view. get sort us, too low year. what I'll But call in see

Great. quick then one. last the And

Does orders impact will Sometimes big, any expense big. guide obviously, that falls the are a to prior expectations? versus strong it SVA. engineering there's orders number that big the negative have for On this number, when -

comment can you Just if you. Thank that. on

take I'll that, Maybe Yes. Chris.

I think that programs, of been activity with of nature the nature bulk strategic development of has just proceeded those – the SVA given the advanced programs.

clear as relates sight it timing XXXX. the there's very that's and So obviously - the for outlook as year line well as beyond of that in this of investment to for required incorporated investment, into

much. so Thanks

We'll go John our ahead America. next to Murphy of and Bank move ahead. from on go with question Please

Good morning, guys.

the lesser know question going cycle you? sort for EVs China kind EVs in could both a life and full extent, cuts of management. around there's on lesser that a First extent. also price of are Kevin, for to And SVA, with view U.S., and mean volumes River for that Wind Europe, in to What of a the in the I

a of River those there's vehicle. profit higher How strategy over developing the as your or automakers like that on could SVA of the and in lifetime seems partake It the Wind front well at margin lower the as that? help and from margin maybe achieve vehicle time end the

change. opportunity should we see the seen prices pull demand. you haven't - those of I'd vehicles we cost - term, through, more more of decline, first see haven't for more much you extent near listen, I Well, think those on Yes. the to a sales, your question, say, retail electric

we the talked that, numbers. We tremendous electrification through having obviously benefit I from. demand of see amount Joe vehicle for the But walked a said that you about bookings.

solution upfront sure solution it's SVA, hardware on of an that the the ongoing as standpoint to software relates them well OEM concluded any it both not an the have, from effort And to will vehicle enable opportunities. revenue As really, be as I'm less. John, profit

opportunities issues on vehicle. to costs a that as relates with on is user well as do can basis, minimize increasing ADAS delivering range. the ongoing we how provide it warranty battery opportunities, focus revenue address then ongoing experience and efficiency to or it to revenue they, on ultimately real relates either enhanced the enhanced solutions, how drive designing, think And manufacturing as as - an battery engineering, opportunities life I

learnings. really it what given over that's And it's So both standpoint which of in the couple vehicles, as to the of offer, what lot from years result, a given I think with that lot I a hardware a been been challenge through demand. heading as demand solution. has as really River towards a associated we that, think the a for has driving discussions, of think well last the endgame of And involved I generated Wind as relates software lot software-defined we've industry gone there's

to more put point we initial and about it succinctly, maybe about have could Okay. And will of these beyond for Maybe you start on the you be opportunity point may in your global profit that just to how calls future, point and you stop revenue of probable so much how time? follow-up be beyond think some more of might do sale much sale? subs. production, much over talking might Or revenue talking at

that have that enable saying enable life we Obviously, to user we Yes. have extent them, that - in experience. solutions. the look increases solutions a and battery cycle it's don't it's - today based way enhancement management No, that To specific we markets it's at that's management, the have constant of it's systems, whether big. whether certain number operate on the a other I we of size whether than upgrade the ADAS,

extent the there's increased to the our in increases market size So opportunities creating we're an to for the market. and us that of revenue opportunity benefit for customers,

Great. Thank much. very you

with Please ahead. Rod from Wolfe go come Lache Our next question will Research.

everybody. morning, Good

Hey, Rod.

numbers. ask the I about to first want

achieved growth, million. that's This $XXX quarter, XX% organic you

Joe, conversion. that XX% mentioned, You the you're achieving

like year-over-year. FX pricing see was that middle over no? of XXX been the commodities manufacturing you but growth growth, maybe it productivity from and not I'm have in last million be It sounds the you and would the the drag, year mentioned might that quarter. million I and of a took EBIT $XXX market some benefit the wasn't So So kind wash. seeing in of $XX about or in there a

Yes. benefit It call I'd - on top but benefit, commodities line. out and basically slight the was sort a a of netting price to are what Rod, net it's slight

line, benefit I slight a from slight the bottom so negative actually top on on think to an the your they're point, the perspective. line - OI

again, FX drove one really you and point the the commodity going - the was XXX is that's things. of prepared side OI part driven margin So what think in on impact if it about, basis in comments, by way going other way, top the of line

a I of mix there. So think there's little bit

FX the think was and if I But the $XX big the - look is, on FX total it, quarter. piece million the in particularly about Mexico you peso, RMB at impact

lot as taken which the really that usually that particularly on you additional impact, bulk certainly strongly, up was or view, a strengthened that sort sort flow-through but folks meaningful least But number this by but - us, an the strong. flowing volume mean out incremental don't for in we the incremental volume in I A of a the FX that quarter. It of isn't any expecting. particularly continue, expect lot to impact, So in quarter. of was revenue about peso it got think at came where our total were

the year? how up, follow to just what the transactional embedded maybe for And are least we how - FX exposure, you about should you've thinking at Okay.

for question Kevin. a just And

export for that address your to something to I largest more in being that obviously, this now. of able companies whether the exposure Chinese time? starting the with actually customer a fifth Aptiv is your could a might lot you Tesla of be growth the got industry think move of some And and the lot to that, hoping needle phenomenon over you and of was You've Geely

From of the Yes, Rod. year. an assumptions start haven't the FX our changed perspective, from

those from not little - Obviously, those and midyear are we the take with the the us, we'll, where a those X.XX. RMB just for at guide. Kevin? a But X. the update at and FX in think markets, They deck original they're the volatility assumptions. point, in So pesos I given have under look assumptions. is the changed in

Rod, rates Sequentially, Yes, should of that, the our across light are be out fall business. you of stay assuming where I just it add in to think balance into they - less I think, or to year. effectively of a the headwind as

it So a be there. should net positive

it some of to progress Tesla. relates to to you Listen, with them, the made or we've - OEMs, tremendous players our exposure growth as referred like

all that grown know, used in China we on were LX+ Geely, across program that ADAS be is we've on focus be that regions. you them As market across with to intended the well. models, initially but exported of as the will will referenced, I awarded vehicles outside China

that opportunity. certainly So is an

at on how local major OEMs on you look discussions, As begin are the focused they China based to do clearly outside they in our export vehicles of China.

level the of China where technologies outside and which quality, a kind meet for consumer they of is and provide themselves I think with they market can they their general opportunities growth. at have have is view additional standards

make this good is large over years, point So has opportunity. I not sure given the quite locals think, significant, it it time. been an we've fairly in But the progress a certainly be is X for at how which I'm last the opportunity. us seen in would

Okay.

locals Just to Kevin, China that like clarify, accounted business backlog. for of China I OEMs? know in are half What local percentage the by the your is your of

standpoint, to revenue think XX%. a XX%. from about it's Today, I Yes, XX%

growing. It's

local. bookings to are sit about If And XX% global, from a XX-XX, we today, local. you XX-XX. And perspective, that number, XX% about Rod, XXXX, we at revenue global, back were go

Thank you.

Our Please with next question Jonas Adam from go Stanley. Morgan comes ahead.

least Rivian, really margins really, on names Ford demand to struggling has the mean, be Thanks, in lower you an changed everybody. talking get here. adverse would you than expected, $XX,XXX pretty by and around medium when Aptiv profit, hear at of selling term? OEM kind Hey, Fisker Western are like markedly and about see guys. Hey, supply vehicles from my no Kevin. read, for for and It like really EVs this narrative kind the being car I Lucid of seems Model per impact the and end year what losing way. Tesla in volumes If

Yes.

North Our margins focus Europe if and high-voltage mixed were slightly you America are overall out, in to on time. margins this our point at SPS and than higher

it's wire If from you bus solutions Intercable our as from about it, engineered components think as from harnesses. connection cable HellermannTyton, well business, management and parts

So margins. than higher our it slightly mixed out, SPS it's

America, biggest standpoint balanced. two Europe a Our they're from by from I China, and then standpoint, revenue It's relatively all markets North today close. believe, are although relatively a followed revenue

take So can a I maybe Joe don't shot at it... know,

expected or XX% in about year. to about volume, is Adam, America North Yes. be the high-voltage of XX%

to above Kevin's point, SPS on high-voltage America segment North basis. call margins You'd that, slightly a

I a back looks Rod's appreciate mandate Chinese ASEAN and markets that. like they term accelerate like near as exports Beijing follow-up, just the going international well. targeting OEMs. from they're to Europe clear And to about Again, a have question into as

I here where How Geely you're and that future to and is BYD would it. much, where need the as done, folks to skating that recognize seems like your always you hear are stay. - the going, puck content thinking you've getting get you like very you team the of It to

are neutral a would on equal, I'm names mix share China, you out of for there thinking those products today, two was a or you? that represent more those if positive, all negative of shift else given surprise, where specifically, taken

the Yes. does China positive. impact fully It BYD want understand. margins? outside to make disproportionate what sure have I be a of were Just Geely to in grow would or market on way, that

Thank you.

Thank you.

with Please Citi. come will go ahead. Itay question next from our Michaeli And

Good thanks. Great, everybody. morning,

you of questions talk just Joe. help maybe for Can and throughout how of us about the you two margins expect maybe year. just rest the cadence me, the for business the Just for

bookings last relative there $X for to now quarters, is just averaging XXXX about with billion. I Or maybe your lumpy you're Kevin, the or secondly, a then expectations? And potential QX, think another running Was upside QX the quarter? on five back to bookings

Maybe Vehicle take Smart Joe, OEMs, bookings second, I'll you think these okay? vehicle I as has over you go with years. Architecture that think lines some lumpy. in And are they number when all - I the programs of across Joe said, are especially first. always a factor of the that's when Listen, significant if programs

impact disproportionate going think on that bookings. business, you're awarded So a when see we're I to

our that that the and naturally, I fair nature go when think the it's products said look selling. the Having about just integration, you to of given amount that, Itay, up expect, actually underlying trend we're domain at consolidation the bookings of

we see in that? it Hard But but dollar this expect awards. Is say right of that continue. we year. is. high trend for an give an to there have you program for a of level Yes, billion confidence to there me we've as beat that communicated exact opportunity amount, now how We'd the timing bookings to $XX we'll to relates would the

question. that appreciate thanks. Itay, I

lot have a about We quarter. the this in talked first

natural XXXX, just historical with of the think that quarterly I'll right, to I sort think just of we our I I'll call be exception, what margin, come to, you XXXX, through returning which the in sort flow of one that's of think cadence should cadence, business.

And we business will through behaved we're historically QX be and talked to up through giving weaker, over the full how that's margin. year. and average we've year. but That's about up the quarterly build year stronger So realize be XXXX. - not how building a margins guidance, will will will the I QX the year

for on point, strike. little years, think XXXX, you to to can watch bit So back just sort is But a the the basically flow go I reference of out there. you've got those

closely, little is chain the on bit one the still obviously it's and an think a unknown that disruption supply this of caveat how I hit costs we're just year managing but quarterly those basis. a

supply the it half disruption we chain improvement. second in COVID believe about those in out have We to roll are $XXX year guide, in the the talked given the they more we sequential just half year As costs. the of as weighted probably first million February, full

is year-over-year. number, which million $XX million QX, round is were, costs a improvement in $XX those And

that's to an business XXX getting a from helpful. that, I of be sort you would got that's - think sort assumption out. the of but So on how rolled make of good And how the But go pre-XXXX. back may think to proxy, if that, perfectly I we're not apart I'd flow

very you helpful. Thank Yes, that's

will from go next question Our ahead. Barclays. Levy come with Dan Please

just Itay's a more there. to a morning. question I good follow-up to Thank start And Hi, you. want Joe, with bit ASUX. on specific

just did margin. roughly You X.X%

you the X%. year, X% it's to think for I said

digits. like So exit think rate, double probably I implies an that

is just just over recoveries it that the is on Or the the get year? ramp-up you those that some it of the timing course So year? of pressures the over dissipating chain visibility supply

in heavier a the I think it's much right? flow business. There's combination, listen, - is There's ASUX. QX Yes. the natural for

to supply credits. those unrelated That's earlier engineering my get COVID, comment on unrelated You chain disruption. That's business how the flows.

it'd digits I QX. double do low be think in

that's reasonable proxy. think a I

have the the quarter. is That and the volume of grow throughout sequential year. going launches you're in have business improvement, We've then some you So second the flow the business growth. strong third going to coming have and normal in, to got you

on And historical? the with you'll that those those that your visibility good you customers have get on just recoveries? based just is a recoveries, Or sense

it Yes. of right? But we - it in lot a lot the year. a this lot last I piece this some mean of There quarter. of of last that in, year a price was and got You obviously care a then take year. did are those remember, rolled to in beginning

there, So say good. guide. We've yes, and it's in would is confidence there I got visibility the

Great. Thanks. up cost clearly follow to their a of EV the tremendous amount line customers, questions very large I plays. on your prior lower strategy think pure And to of price the of been has on reduce to wanted And unlock points. one I

are firm these and does in to you you margins I environment where will your of strategy presume I as their as still make that trying So Or extent that that's that as your environment possible to understand cost hold but point, to offering? unlock just what much it on their tougher can In customers environment where have you? an and well. lower a for price want out others system commercial an strategy, cut to - follow

us. perfect a benefit from environment actually That's that. for We

about you into way own to integration, integrate more translates tend of get content. result revenues, that system it of we higher our get to the sort and a when is the optimize only translates margins. our customers more ability that So ability thinking situation of to full solution, think We that of tend to result and our to content, not higher which

as example, vehicle great architecture, the up low asked of us think And we've kind at ideas couple a and we've a about weight, mass to well can come to reduce past, talked OEMs look nuts, high-voltage in and their both soup with take us to come this we where of I a voltage had as and costs.

situations profitability. saving been And time, at the customer reduce money, enhancing XX% we're that, by been we've to to a able same there have able of do where while cost the our overall XX%. to And number

are So really situations that for those good are us.

delivering and a that Studio, piece we challenges customers previously, stack, River, we've and we're us which about River in-sourcing as when to achieve that Wind Wind of to of outsourcing you intended And solutions. about our think that lower into - all drive When you flexibility seeing evolve are more big And having the we software their is what that about think we overall doing technology reduce to we're And customers to with enable with of cost. about to that think need those come our cost. our about objectives. are understand the things at we're in fully versus software, the fact terms having talked when customers debate provide you

sort might we we're with environment really in. So but of sound think the to be you, looking we and candid a prosper that that's crazy, little for, it actually

you. Thank Great.

question Rosner Bank. comes next Deutsche from Emmanuel with The ahead. Please go

for I more much. I year. guess, if of questions, rest very you cadence the of may, the A Thank couple expected

market, your guess, for obviously, on year. I first the and full to in points quarter gross XX the X framework normal then over X First, of the

of terms drives mostly it the of acceleration, In timing what launch? this is your

think, happened the year, number the QX X a points, given they right? throughout were they just of America, of North ramps Yes, launches but is We this will we're in chain particularly there, the slowed customers, had in too. more sort some last the We launching, strengthen I year, supply of abnormal - Those QX just couple just constraints. ramp. accelerating and or

So we're - to they relative strong. market, weren't as just

better up. So those in getting clearing problems quarter. are They're this

of framework it's more happen returning - to framework. we something to then get So needs a to us to the the

it's it's and long appreciate been said, a side to within longer well and to be specific And lumpier more always concern. term a appreciate it, guide, we've but I high - going lumpy, to this always thing I a than historically QX we've historically but launches, term It's a right? is been the with little it's

growth the made the of the rest there's up? market following the in quickly are be on you to of half this, And up saying Or you in - are just volumes expecting of just sort back these that year... enough

going able enough make being to there's think Yes, on suppliers I they the parts. that's the if depend it up, - get can to other

the make where how be schedule, We'll back. to can think see can I supply hit up. is returned least much they we'll at so they

and cadences on terms the Thank improvement And the the Okay. it, would of just then us half, you. of And sort I the in in remind pieces business. flow the right? appreciate of piece the of the maybe margin second you XXXX just The normal - big extremely of back helpful. be comments like cadence margin. around Can is

terms like just how... could disruption sort pieces I costs you guess, price quantify interested if or that of more of there's in either Just lower recoveries,

is The half. Yes. first going price benefit really net be to

not bit little last or a about If time that think June. really July when was kicked you frame, year in August in

we've will of needing labor material And really We and performance about sort we're into little offset the That improvement, seeing now. to the that to continue you that So when it see manufacturing did get then a talked positive started offset side - costs QX. to actually. to right?

that's to So continue. going

credits things. then through of strong of think and cadence those you volume then types QX back a of normal the around you the year, And as well I have that see build engineering half

customer So the those given are the price, last year recoveries timing first half - just of started the in. but really kick when net a to they

Thank you. Okay.

Goldman comes Please with Sachs. question from Mark Delaney ahead. The next go

Good Yes. morning. Thank my taking question. you for

growth and of cadence if annualizing spoke supply revenue, side, maybe the revenue a in We over spoke ease. the on to $XX.X chain about billion. nearly particular, you're end market the high about bit. picking starting to We up on guidance XQ one around the Another I take

to But year. cadence year? for revenue you the end us considering about on and maybe could if the of there the we line offsets the think understand top guidance any to maybe you the So towards be need of better appears are how tracking throughout it help high are

Mark, a goes start. I think Listen, off to it goes to back good QX back right? first it - was comments, - Chris' Yes. sort it We - of is

mentioned, be think expectations our very I reassess And QX and we with the I FX, where the that to North delivery. we for we feel and the line we're happy with good are quarter was balance, as year. But it's in think very same, I on a we expect Obviously much America. then about.

plays normal better And Ideally, at and we'll starting margin get in side, - the disruption there's their feels we're I where like production again, just in to of think QX, million to improvement. on $XX see much then do customers said, those the costs away schedules million, what for back are costs to million business sequential And out, Kevin cadence so sort in the hit. We the the think I can I faster. of look saw when and a do XXX year. half actually what how sense back of of with as I historically the have QX continue the $XX disruption detailed go good year. XXXX, of we improvement this to to these we and exception in flow see down we

that my Okay. good That's seeing River of momentum all you're to the and hear Wind was customers. on helpful. second And with

talk prepared potential about in did Wind River You lumpiness remarks. the in

that's So could to, on more aware we're the to especially maybe River, for cadence bit River were the both there's we little but weakness you a thinking maybe certainly you within Wind anything be I double-click some telecom business Wind as about and that. CapEx speaking maybe mindful mean just on and year. EBIT it's need Thanks. a high-margin of the because what

Yes. Yes.

expectations. total performed both line to accretive are margin Acquisitions the mentioned, with acquisitions margin. in So both, as I Aptiv [ph] for

revenue So on OI. and the it's the both positive

It's last any comment My revenue stream, just $X.X it's telecom a less the - - year, weakness it's small billion up be some very around on expectations necessarily than XXX a to to particular year. Wind important weakness Relative right? relatively market. It's this not of or over that a time. business, about from trying ahead little set but in - there'll River,

to big in on have quarterly tend deals come a some They basis.

existed That's that like of about. And of some revenue of always it's it's up. opportunities cautioning much bookings, all our business. So cadence straight when of line the timing was quarter-to-quarter-to-quarter. signed more I a It's a within not larger get necessarily

a So a private and have very a I think quarterly, full as hadn't good those year, to appeared little And track lumpy. caution the historically they and company, managing have good record. very the of before Quarterly, sense historically they been that lumpiness after. that versus contracts you sense. makes I a if be to will, just wanted some - we business If

Yes. It's the really the - it's of contracting. nature for accounting the revenues, the

you. Thank

Narayan come And go with Markets. last question Please will Tom our ahead. RBC Capital from

question. guys. follow-up I quick on, think, Hi. Rod's Yes, Thanks, a

sounded the that QX changed QX. Joe, said impacts like it's in in that and FX end and QX it at the Just now based has the of - assumptions you - like

it guidance Just it... like curious or how it QX if if the at change is level, stays your - FX would specifically impacted EBITDA be that Is EBITDA that margin? does how

million. We've that's $XX the The versus we're for FX, impact about guidance. the rates Let's right? be in clear, though, let XXXX QX QX talking year-over-year 'XX, place the is

So it's rates the end the quarter. at where up end of

is peso the and transaction specifically, loss, So that number. RMB year-over-year that Mexico a in particularly and the

again, there. assumptions And our are

the X vehicle markets. in think. - FX prices really look have the what We But production, haven't year-over-year again, there. seen see to out think and is and year. ahead those FX, get we guide we volatility And assess the I we some beginning commodity midyear, a since to months macros, impact of the didn't versus next we'll as the changed We've

was So about. I it's year-over-year talking the really impact

China, one follow-up think the pretty that kind Okay. would Thanks that provider customers, in large OEM. for I order that. of And then substantially their ADAS OEM a specific season purchase this just earnings be reduced of the noted there's

in you mean, the is terms exposure? OEM specific But how strong challenges Chinese China, there really specific your suggests guidance of in there. a market OEM if noteworthy exposure anything your certainly, I curious your Just characterize? despite would growth over

since as our base gave No, market, beginning this year China hasn't relates to the changed we it when Yes. guidance. of outlook customer our

we So would - significant least, at see we, changes. any don't

And over like hand now any session question-and-answer today. does or to back call for our with the additional Clark that conclude Kevin that, would to remarks. I for closing

you, time Thank everybody, of Have great you. day. your a today. Thank the for rest

And you for with call. that that, participation. Thank today's conclude does your

disconnect. now may You