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GENTEX CORP (GNTX)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 consolidated revenue was $655.2M (+7.7% YoY), with core Gentex revenue down 6% YoY; consolidated gross margin expanded 90 bps YoY to 34.4%, and diluted EPS was $0.46 . Versus S&P Global consensus, revenue of $655.2M missed $669.4M* and EPS of $0.46 missed $0.472*, while EBITDA beat consensus ($148.8M* vs $144.0M*) .
  • Regional/mix headwinds: Europe revenue declined ~14% QoQ on lower-trim mix and customer-specific issues; China revenue was ~$34M (–35% YoY) due to tariffs/counter-tariffs; North American OEM revenue rose ~5% QoQ on stronger content per vehicle .
  • FY25 guide raised at the low end: consolidated revenue $2.50–$2.60B (from $2.44–$2.61B), gross margin 33.5%–34.0% (from 33%–34%), and tax rate narrowed to 16%–16.5%; OpEx (ex-severance) $380–$390M; capex $115–$125M .
  • Call tone: Management emphasized continued gross margin improvement despite ~90 bps tariff drag and expects tariff recoveries with a lag; FDM unit growth raised to +200k–300k in 2025 vs 2024; VOXX already EPS-accretive with >$10M annualized savings to date and a ~$40M annual FCF target within ~18 months .

What Went Well and What Went Wrong

  • What Went Well
    • Gross margin improvement continued: consolidated GM 34.4% (+90 bps YoY) and core GM 34.9% (+140 bps YoY) driven by NA customer/product mix, purchasing cost reductions, and operational efficiencies .
    • North America resilience and content growth: North American OEM revenue grew ~5% sequentially, supported by robust schedules and rising content per vehicle .
    • VOXX contribution and early synergy traction: VOXX contributed $84.9M revenue and was accretive to EPS in Q3; management cited >$10M annualized savings achieved and reaffirmed a ~$40M annual FCF target in ~18 months .
  • What Went Wrong
    • Europe/China pressure: Europe revenue fell ~14% QoQ on lower-trim mix and customer issues; China revenue ~$34M (–35% YoY) due to tariffs/counter-tariffs .
    • Core revenue contraction: Core Gentex revenue fell 6% YoY despite primary market LVP up ~2% YoY; consolidated other income swung to a $(1.8)M loss vs +$19.7M last year on absence of a prior-period VOXX revaluation gain .
    • Tariff drag on margins: Incremental tariff headwinds reduced margins by ~90 bps in Q3; reimbursement is lagged into Q4 per management .

Financial Results

MetricQ3 2024Q2 2025Q3 2025
Revenue ($M)$608.5 $657.9 $655.2
Diluted EPS ($)$0.53 $0.43 $0.46
Gross Margin (%)33.5% 34.2% 34.4%
Operating Income ($M)$125.7 $118.5 $122.3
Net Income Attributable to GNTX ($M)$122.5 $96.0 $101.0

Notes: Q3 2024 comparative columns are presented as reported within the Q3 2025 8‑K/press release exhibits .

Actuals vs S&P Global Consensus and Forward Look

MetricQ3 2025 ActualQ3 2025 ConsensusQ4 2025 Consensus
Revenue ($M)655.2 669.4*650.9*
EPS (Primary/Diluted, $)0.46 0.472*0.419*
EBITDA ($M)148.8*144.0*129.3*

Values with asterisks are retrieved from S&P Global.

Segment Revenue

Segment ($M)Q3 2024Q2 2025Q3 2025
Gentex Automotive596.5 566.5 558.0
Gentex Other12.0 12.5 12.3
VOXX—78.8 84.9

Key KPIs (Units, thousands)

KPI (000s)Q3 2024Q2 2025Q3 2025
Total Auto-Dimming Mirror Units12,221 11,575 11,246
Total North American Mirror Units3,823 3,746 3,830
Total International Mirror Units8,399 7,830 7,416
Total Interior Mirrors7,860 7,534 7,181
Total Exterior Mirrors4,362 4,041 4,065

Guidance Changes

MetricPeriodPrevious Guidance (7/25/25)Current Guidance (10/24/25)Change
Consolidated RevenueFY 2025$2.44 – $2.61B $2.50 – $2.60B Raised low end
Gentex Primary Markets RevenueFY 2025$2.10 – $2.20B $2.14 – $2.15B Narrowed around upper end
Gentex China RevenueFY 2025$100 – $125M $135 – $145M Raised
VOXX RevenueFY 2025$240 – $280M $250 – $275M Narrowed
Gross Margin (Consolidated)FY 202533% – 34% 33.5% – 34% Raised low end
Gross Margin (Gentex stand-alone)FY 202534% – 34.5% 34.25% – 34.75% Raised
Gross Margin (VOXX stand-alone)FY 202527% – 29% 28% – 29% Raised low end
OpEx (ex-severance)FY 2025$370 – $390M $380 – $390M Raised low end
Tax RateFY 202516% – 17% 16% – 16.5% Narrowed lower
CapExFY 2025$100 – $125M $115 – $125M Raised low end
D&AFY 2025$91 – $98M $96 – $99M Raised

Earnings Call Themes & Trends

TopicPrevious Mentions (Q-2 and Q-1)Current Period (Q3 2025)Trend
Tariffs & recoveriesQ1: New tariff costs ($0.65M), halted China-directed production pending pricing; guidance reset lower . Q2: Tariffs partially unreimbursed; margin initiatives accelerating .~90 bps margin drag; recovered ~70–80% of Q2 tariffs in Q3; expect most remaining by Q4; lag persists .Stabilizing with lagged recovery; ongoing risk into Q4.
Europe mix & decontentingQ1: Trim mix weaker across regions; exterior mirrors pressured . Q2: Mix tailwinds supported margins; regional softness continued .Europe revenue –14% QoQ on lower-trim mix and limited OEM-specific shutdowns ($5–$6M); some decontenting at select OEMs .Negative mix persists; likely less drastic in Q4 per mgmt .
China demandQ1: Guidance carved out; tariffs/counter-tariffs drove order pauses . Q2: China revenue ~$33M vs $50–$60M plan .~$34M revenue (–35% YoY); mgmt prepares for 12–18 months of headwinds .Ongoing headwind; FY guide raised for China on improved visibility .
FDM (Full Display Mirror)Q1: Emphasis on higher-end tech to drive growth . Q2: Strong FDM; 150k–300k above 2024 guided .Raised to +200k–300k above 2024; strong Q3 and expected Q4 demand .Positive momentum.
VOXX integrationQ2: Closed April 1; $78.8M revenue in Q2; margin/OpEx frameworks set .Q3 VOXX $84.9M; EPS-accretive; >$10M annualized savings realized; ~$40M/yr FCF target within ~18 months .Accretive earlier than planned; synergy capture continues.
New products (Dimmable visors/roofs; DMS/ICM)Q2: Large-area devices progressing; DMS platforms for four key customers .Dimmable roof/visor in-house process targeted late Q1–early Q2 2026; three more DMS customers by mid-2026 .Execution focus; timelines clarified.
Supply chain (Nexperia)—Some exposure; exercising alternate sourcing; no significant Q4 impact expected .Managed risk; watch OEM knock-on effects.

Management Commentary

  • “On a quarter-over-quarter basis, the Gentex core gross margin improved by 140 basis points, driven by favorable North American customer and product mix, purchasing cost reductions, and continuing operational efficiencies… [tariffs] negatively impacted margins by approximately 90 basis points” (Steve Downing) .
  • “We… recovered probably 70% to 80% of the tariff costs of Q2 in Q3… We would expect to get most of that reimbursed in Q4. There’s definitely a lag effect” (Steve Downing) .
  • “Q3 was really good growth in FDM again… we see us exceeding 2024 numbers by 200,000 to 300,000 units” (Neil Boehm) .
  • “VOXX… is positive on the net income side and accretive on the EPS side… we’re over $10 million of annualized savings… We believe… ~$40 million… in free cash flow… in about 18 months post-acquisition” (Steve Downing; IR) .

Q&A Highlights

  • Europe headwinds: ~$5–$6M temporary revenue hit from a European OEM shutdown, with the bulk from lower-trim mix; decontenting at select OEMs added pressure; mgmt expects Q3 severity to moderate in Q4 .
  • Tariff recovery cadence: ~70–80% of Q2 tariffs recovered in Q3; the step-up in Q3 tariffs expected to be largely reimbursed in Q4, but timing lags persist .
  • Gross margin seasonality: Q4 GM step-down driven by seasonal revenue and higher VOXX mix; on equal revenue, Q4 margin would look “very, very similar” to Q3 (no structural issues) .
  • FDM trajectory: Raised 2025 unit growth to +200k–300k vs 2024; despite EV launch delays, ICE/hybrids continue to adopt FDM .
  • VOXX synergy roadmap: EPS-accretive already; >$10M annualized savings realized; targeting ~$40M annual FCF within ~18 months; early cost reductions include audit/insurance and exec overlaps .

Estimates Context

  • Q3 2025 revenue $655.2M missed S&P Global consensus $669.4M* (–2.1%); EPS $0.46 missed $0.472* (–2.1%); EBITDA $148.8M* beat $144.0M* (mix and cost actions supported margins) .
  • Q4 2025 consensus: revenue $650.9M*, EPS $0.419*, EBITDA $129.3M*; management expects Q4 margin seasonality (lower revenue, higher VOXX mix), with tariff reimbursements helping offset lagged costs .
  • Implications: Street models may trim top-line for continued Europe/China headwinds, while gross margin and EBITDA could hold better on mix/costs and tariff recoveries; FY25 guidance raises at the low end should anchor estimates within updated ranges .

Values with asterisks are retrieved from S&P Global.

Key Takeaways for Investors

  • Margin execution offsetting revenue volatility: Consolidated GM reached 34.4% (+90 bps YoY) despite ~90 bps tariff drag, reflecting mix and cost discipline; mgmt aims to sustain high‑34% GM into 2026 if tariffs stabilize .
  • Core revenue under pressure ex‑VOXX: Core Gentex revenue –6% YoY as Europe mix shifted down and China tariffs weighed; VOXX’s accretion and synergies are cushioning EPS .
  • Guidance bias improving: FY25 revenue and GM ranges nudged higher at the low end, and China/VOXX sub-guidance tightened upward, signaling better visibility into H2 dynamics .
  • Near-term watch items: Q4 seasonality and VOXX weighting on GM, pace of tariff reimbursements, Europe mix normalization, and any OEM decontenting spillover to NA/Asia .
  • Medium-term growth vectors: FDM expansion (+200k–300k units in 2025), DMS/in-cabin launches through mid‑2026, and dimmable roof/visor manufacturing ramp targeted for early 2026 .
  • Capital returns: 1.0M shares repurchased in Q3 ($28.3M); YTD 9.8M shares ($230.5M) with additional authorization capacity remaining; dividend maintained at $0.12/share .
  • Trade setup: Stock narrative likely driven by revenue/mix normalization vs. continued margin resilience; any signals of faster tariff recovery or VOXX synergy capture could be upside catalysts, while deeper European decontenting/China demand deterioration are key risks .