Nov 3, 2026 earnings call — New bookings and cautious 2027 outlook
Aptiv said it expects approximately $700 million of semiconductor-related inflation recoveries in 2027.
Revenue $3.2B (est $3.2B) · EPS $1.42 (est $1.33) · Next-quarter revenue outlook $3.2B
Key quotes
"Currently, we are estimating approximately $700 million in inflation related to semiconductor prices primarily memory"
"And we booked $3.8 billion of non auto awards more than doubled the year ago period as we have established our presence in new end markets."
"And we remain active in the fourth quarter and plan to repurchase at least $650 million by year end, returning 100% of our free cash flow to shareholders during 2026."
Analyst Q&A 8
2027 growth drivers and offsets
Q (Dan Levy · Barclays): He asked what drives the preliminary 2027 outlook after backing out the $700 million recovery. He wanted the puts and takes: non-auto strength, backlog/bookings, and the impact from reduced Europe-to-China exports.
A: Management said nonautomotive is performing well and bookings have essentially doubled year over year. They said the automotive business (which is 3 quarters of revenue) is challenged by vehicle production outlook and supply constraints. They expect the European export headwind to persist through the end of 2027 before returning to growth in 2028.
"We expect that to continue, and that is backed up also by the bookings that we have seen, which have essentially doubled up on a year over year basis." — Varun Laroyia (CFO)
$700m recoveries and cash impact
Q (Joe Spak · UBS): He asked how set the $700 million recovery number is and whether any commodity leakage remains. He also asked about 2027 CapEx and working capital implications for free cash flow.
A: They said they have been discussing the inflation issue with customers for 6 to 9 months and are negotiating higher prices so they do not absorb the cost. They said they will be judicious on non-contracted CapEx, do not expect EDS spin separation costs to recur in 2027, and are working with suppliers and structures to mitigate net working capital impacts.
"Listen. I just given the order of magnitude of the inflation, 1. 2, we have been having, discussions with our customers for the last, I would say, 6 to 9 months with respect to sizing the potential risk, or issue." — Kevin Clark (CEO·CHAIR)
Is guidance below market and margins
Q (Morgan Stanley): He asked whether the preliminary 2027 revenue guide assumes market growth or underperformance versus the market. He also asked what drives the assumed improvement in incremental margins before recoveries.
A: They said the guide starts with September third-party forecasts at the top of the range and then they overlaid conservatism for macro and supply constraints. They said the incremental margin algorithm (the 26 to 27 points on revenue growth ex recoveries) remains, but recoveries tied to commodity inflation will dilute margins and they plan to offset with performance initiatives.
"Putting aside the point of dilution from recoveries related to material inflation, Overall, incremental margin algorithm, you know, of the 26 to 27 points on revenue growth ex recoveries, that remains." — Varun Laroyia (CFO)
China exports and German program headwind
Q (Mark Delaney · Goldman Sachs): He asked what the >20% bookings from China exports imply for next year versus about 10% this year and whether margins differ. He also asked for size and reason of the German luxury OEM rolloffs.
A: They said Intelligent Systems export mix from China is growing and they are winning business that uses China cost structure and SoCs, with margin roughly in line with the company. On the German OEMs, they said about a third of the 2027 headwind comes from softer schedules on export platforms and other program runoff effects, and the total headwind is "kind of a couple hundred million, $2 million to $300 million."
"About a third of the headwind in 2027 comes from just softer schedules, principally on export platforms." — Kevin Clark (CEO·CHAIR)
What is in the $700m and portfolio review
Q (Emmanuel Rosner · Wolfe): He asked what the $700 million recovery includes (memory, semiconductors, FX, other items). He also asked what management is evaluating in the portfolio review to be discussed in Q1 2027.
A: They said the $700 million is mostly memory and also includes some semiconductor inflation, and that year-over-year node price increases vary by technology. They said the portfolio review is a deep evaluation of businesses and products in the context of market challenges and opportunities, revenue growth and margin outlook, and competitive position, with an update in Q1 27.
"there is semiconductor-- some semiconductor as well that is in that." — Kevin Clark (CEO·CHAIR)
China outlook and robotics opportunity
Q (Itay Michaeli · TD Cowen): He asked what the company assumes for China export versus domestic production in 2027. He also asked whether the humanoid robot award opens additional humanoid opportunities.
A: They said their preliminary estimate is slightly down and their baseline is China market flat, with a downside scenario of vehicle production down 2%. They said exports might not decline overall but could move to different markets. On robotics, they said the award helps and they are active across regions, but they see higher-volume opportunity with AMRs versus humanoids and are working with humanoid developers in U.S., Europe and China.
"I think as we have talked about in the past, we think a more likely high volume use cases with AMRs versus humanoids at this point in time, our view is that is a more challenging technical challenge." — Kevin Clark (CEO·CHAIR)
Is $700m year-over-year and Q4 segments
Q (James Picariello · BNP Paribas): He asked whether the $700 million recovery is year over year or relative to the prior $175 million memory buy. He also asked for 2026 Q4 revenue and EBITDA color by segment.
A: They confirmed the recovery is $700 million year over year. They said the enterprise Q4 guide stands, Engineered Components should grow in line to maybe slightly higher, and Intelligent Systems is impacted by program rolloffs and exports; Q4 typically has the strongest margin profile due to engineering rebills and customer credits.
"Yep. it is $700 million. So the year over year is $700 million." — Kevin Clark (CEO·CHAIR)
How Aptiv wins China export business
Q (RBC): He asked how the company can increase China export mix versus domestic work and whether the China production view is conservative versus other forecasts.
A: They said having engineering and commercial teams deeply embedded with OEMs gives visibility to which programs will be exported because export platforms need different homologation and planning. They said their baseline uses IHS forecasts with an added layer of conservatism; exports may be down in Europe but OEMs may shift volumes to other regions, and they also model a down 2% production scenario.
"If you have a strategic relationship with the OEM or you foster 1, you will get visibility to what their product plans are." — Kevin Clark (CEO·CHAIR)