Magna International Announces Fourth Quarter 2025 Financial Performance and Future Projections
AURORA, Ontario – Magna International Inc., the global automotive manufacturing giant, has unveiled its financial results for the fourth quarter ending December 31, 2025, alongside a comprehensive outlook for the upcoming year. The company demonstrated resilience and operational excellence despite challenging market conditions, with CEO Swamy Kotagiri expressing confidence in continued momentum.
Fourth Quarter 2025 Financial Highlights
Magna delivered a solid performance in the final quarter of 2025, achieving sales of $10.8 billion, which represents a 2% increase compared to the same period in 2024. This growth occurred despite a 1% decline in global light vehicle production, highlighting the company's ability to outperform industry trends through disciplined execution.
The adjusted EBIT (Earnings Before Interest and Taxes) saw a significant improvement, rising 18% to $814 million. This resulted in an adjusted EBIT margin expansion of 100 basis points to 7.5%, indicating enhanced operational efficiency and profitability.
Other key financial metrics from the quarter include:
- Income from operations before income taxes was $114 million, which included non-cash impairment charges of $615 million.
- Adjusted diluted earnings per share increased 29% to $2.18, while reported diluted earnings per share was $0.00.
- The company generated $2.0 billion in cash from operating activities and $1.3 billion in free cash flow.
- Magna ended 2025 with $1.6 billion of cash on hand.
- The quarterly dividend was increased to $0.495 per share, marking the 16th consecutive year of dividend growth.
Full Year 2025 Performance Overview
For the entire year of 2025, Magna reported sales of $42.0 billion, with adjusted EBIT reaching $2.364 billion. The company expanded its full-year adjusted EBIT margin by 20 basis points and generated robust free cash flow of $1.9 billion. Net income attributable to Magna International Inc. was $829 million, with diluted earnings per share at $2.93.
2026 Outlook and Strategic Initiatives
Looking ahead to 2026, Magna expects solid top-line performance and sustained progress toward its long-term margin objectives. The company has provided specific financial projections that reflect optimism about its operational capabilities and market position.
The 2026 outlook includes the following expectations:
- Sales are projected to be between $41.9 billion and $43.5 billion.
- Adjusted EBIT margin is anticipated to range from 6.0% to 6.6%.
- Adjusted diluted earnings per share are expected to fall between $6.25 and $7.25.
- Capital spending is projected to be between $1.5 billion and $1.6 billion.
- Free cash flow is anticipated to be in the range of $1.6 billion to $1.8 billion.
Additionally, Magna intends to repurchase the remaining approximately 22 million shares available under its current normal course issuer bid (NCIB) buyback authorization. This move underscores the company's commitment to returning value to shareholders while maintaining financial discipline.
Leadership Perspective and Strategic Direction
Swamy Kotagiri, Magna's Chief Executive Officer, commented on the results: "We closed 2025 with a strong fourth quarter, successfully navigating another dynamic year in our industry. Our disciplined execution and commitment to operational excellence enabled us to deliver financial results that were in line with, or exceeded, our February 2025 Outlook across all key metrics."
Kotagiri added: "Our 2026 outlook reflects confidence in our ability to build on this momentum. With capital spending expected to remain below historical levels, we anticipate continued strong free cash flow, which we intend to deploy using our long-standing capital allocation framework, including repurchasing the remaining shares available under our current buyback authorization."
The company's financial results are reported in millions of U.S. dollars, with per share figures also denominated in U.S. currency. It is important to note that adjusted EBIT, adjusted EBIT margin, adjusted diluted earnings per share, and free cash flow are non-GAAP financial measures that may not be directly comparable to similar measures used by other companies.
