Joseph Spak

Thomas Scholl

David Silver

Robert Brooks

Bobby Brooks

Drew Estes

Federico Merendi

Jake Scholl

- PHINIA is actively diversifying its business, with the automotive end market comprising **27%** of total revenues and expected to decrease, while the aftermarket segment accounts for **34%** of global revenues and provides stable cash flow.  **[1968915_2139404_0]** **[1968915_2139404_3]** 
- The company is expanding into new markets such as aerospace and off-highway by leveraging existing capital, with the first two aerospace programs with Saffron set to launch in **Q4** (current year) and **Q1** (next year).  **[1968915_2139404_1]**  These new markets are anticipated to contribute mid to high single digits of total revenue by the end of the decade.  **[1968915_2139404_1]** 
- PHINIA maintains a disciplined capital allocation approach, projecting to generate approximately **$160 million** in free cash flow during the second half of the year, following a first half generation of around **$20 million**.  **[1968915_2139404_4]**  The company allocated **$50 million** to the SEM acquisition and has approximately **$90 million** available for share repurchases or further acquisitions.  **[1968915_2139404_4]** 
- PHINIA expects tariffs to be neutral to its P&L, forecasting a revenue increase of **$50 million-$60 million** with no EBITDA impact, which will slightly adjust the EBITDA margin midpoint from **14.1% to 13.9%**.  **[1968915_2139404_4]**

PHINIA Discusses Business Diversification, New Market Entry, and Capital Allocation Strategy

- PHINIA highlights its business diversification, with automotive representing **27%** of total revenues and the aftermarket segment contributing **34%** of global revenues.  **[1968915_2139378_0]** **[1968915_2139378_2]** 
- The company is expanding into new markets such as aerospace and off-highway, utilizing existing resources and projecting these areas to account for mid to high single digits of total revenue by the end of the decade.  **[1968915_2139378_1]** 
- PHINIA's capital allocation strategy remains consistent, with an expected **$160 million** in free cash flow generation in the second half of the year, allocating **$90 million** for share repurchases or other acquisitions after dividends and the SEM acquisition.  **[1968915_2139378_4]** 
- The North American heavy-duty commercial vehicle market, which accounts for less than **10%** of revenues, is currently stable at a low point, with no significant recovery or pre-buy anticipated in the near term.  **[1968915_2139378_0]** **[1968915_2139378_3]** **[1968915_2139378_4]** 
- Tariffs are expected to be P&L neutral, increasing revenue by **$50 million** to **$60 million** but having no impact on EBITDA, which remains guided at a **$470 million** midpoint.  **[1968915_2139378_4]**

PHINIA discusses business diversification, new market entry, and capital allocation strategy

- PHINIA operates as a **diversified industrial company**, with the automotive end market accounting for only **27%** of its total revenues, and its stable aftermarket business contributing **34%** of global revenues.  **[1968915_2139406_0]** **[1968915_2139406_3]** 
- The company is strategically expanding into **new markets** such as aerospace and off-highway by leveraging existing capital and expertise. The first aerospace programs are set to launch in **Q4 2025** and **Q1 2026**, with these new ventures projected to contribute mid to high single digits of total revenue by the end of the decade.  **[1968915_2139406_1]** 
- PHINIA maintains a disciplined **capital allocation strategy**, targeting **$180 million** in free cash flow for the full year, with **$160 million** expected in the second half of **2025**. After accounting for dividends and the **$50 million** SEM acquisition, approximately **$90 million** remains available for share repurchases or further acquisitions.  **[1968915_2139406_4]** 
- While the North American commercial vehicle market is currently challenged, it appears to be **bottoming out**.  **[1968915_2139406_3]**  Tariffs are anticipated to increase revenue by **$50 million-$60 million** but are expected to have **zero EBITDA impact**.  **[1968915_2139406_4]**

PHINIA Discusses Diversification, Growth Strategy, and Capital Allocation

- PHINIA highlights its diversified industrial business, with **aftermarket contributing 34% of global revenues** and the auto end market representing **27% of total revenues**.  **[1968915_2139266_0]** **[1968915_2139266_2]** 
- The company is strategically entering new markets such as **aerospace and off-highway**, leveraging existing capital and human resources, with these markets projected to contribute **mid to high single digits of total revenue** by the end of the decade.  **[1968915_2139266_1]** 
- PHINIA maintains a disciplined capital allocation strategy, having bought back nearly **20% of shares** since its spin-off.  **[1968915_2139266_2]**  For the second half of the current year, they anticipate generating approximately **$160 million in free cash flow**, allocating **$20 million for dividends** and **$50 million for the SEM acquisition**, leaving about **$90 million for share repurchases or other acquisitions**.  **[1968915_2139266_4]** 
- The company expects tariffs to be **neutral to its P&L**, with an increase of **$50-60 million in revenue** but **zero EBITDA impact**, maintaining the EBITDA number at **$470 million**.  **[1968915_2139266_4]**

PHINIA Discusses Business Diversification, New Market Entry, and Capital Allocation at Morgan Stanley Conference

- PHINIA is a **$3.4 billion** company with approximately **34%** of its revenues derived from the aftermarket segment, which is expected to grow **4% to 6%** annually due to factors like price increases, market growth from an aging car park, and portfolio expansion.  **[1968915_tx_377870_0]** **[1968915_tx_377870_4]** 
- The company maintains a net R&D spend of around **3%** of sales, focusing on providing turnkey solutions and leveraging its technology to expand into new markets such as off-highway (marine, industrial, gen sets, ag, construction) and aerospace.  **[1968915_tx_377870_0]** **[1968915_tx_377870_2]** **[1968915_tx_377870_5]** **[1968915_tx_377870_6]** 
- PHINIA, which was spun out in **mid-2023**, recently acquired SCM to enhance its offerings in ignition and system integration, and is currently consolidating its four ERP systems into one.  **[1968915_tx_377870_0]** **[1968915_tx_377870_3]**

PHINIA (PHIN)