Garrett Motion — Income Statement, Cash Flows & Balance Sheet
Is Garrett Motion profitable?
Garrett Motion grew revenue and expanded profitability in 2025, continuing a streak of improving earnings.
| Metric | 2024 | 2025 | Change |
|---|---|---|---|
| Net sales ($M) | $3,475 | $3,584 | +3.2% |
| Gross profit ($M) | $705 | $731 | +3.7% |
| Gross margin | 20.3% | 20.4% | +0.1 pp |
| Net income ($M) | $282 | $310 | +9.9% |
| Diluted EPS | $1.26 | $1.52 | +20.6% |
Revenue grew modestly, but net income grew at three times that rate, helped by significantly lower interest expense as Garrett refinanced its debt at better terms. EPS grew even faster because the share count shrank as the company bought back stock throughout the year.
Interest expense fell sharply after a 2024 debt restructuring, which meaningfully boosted the bottom line.
| Item | 2024 | 2025 | Change |
|---|---|---|---|
| Interest expense ($M) | $156 | $108 | -31% |
| Income before taxes ($M) | $343 | $392 | +14% |
In 2024, Garrett paid down older, higher-rate term loans and issued new fixed-rate senior notes, incurring one-time costs that inflated that year's interest expense. With the cleaner debt stack in place, 2025 interest costs dropped substantially, flowing directly to pre-tax income.
Where does Garrett Motion's revenue come from?
Europe is Garrett's largest region, and it was the primary driver of growth in 2025.
| Region | 2024 | 2025 | Change |
|---|---|---|---|
| Europe ($M) | $1,642 | $1,745 | +6.3% |
| United States ($M) | $700 | $694 | -0.9% |
| China ($M) | $643 | $638 | -0.8% |
| Rest of Asia ($M) | $413 | $406 | -1.7% |
| Other International ($M) | $77 | $101 | +31% |
Europe more than offset softness in North America and Asia, with China in particular still well below its 2023 level. The small "Other International" segment is growing quickly off a low base.
Gas turbochargers are the largest and fastest-growing product line; diesel continues a multi-year decline.
| Product Line | 2024 | 2025 | Change |
|---|---|---|---|
| Gas ($M) | $1,505 | $1,592 | +5.8% |
| Diesel ($M) | $827 | $837 | +1.2% |
| Commercial Vehicle ($M) | $629 | $654 | +4.0% |
| Aftermarket ($M) | $459 | $438 | -4.6% |
Gas turbos — used in lighter-duty gasoline engines — are taking share and now represent nearly half of total revenue. The Aftermarket segment, which tends to carry better margins, dipped modestly year over year.
Does Garrett Motion generate cash?
Garrett is a strong cash generator, and free cash flow (operating cash minus capex) held up well despite more spending on buybacks and dividends.
| Item | 2024 | 2025 | Change |
|---|---|---|---|
| Operating cash flow ($M) | $408 | $413 | +1.2% |
| Capital expenditures ($M) | $(91) | $(72) | -20.9% |
| Free cash flow ($M) | $317 | $341 | +7.6% |
| Share repurchases ($M) | $(296) | $(208) | -29.7% |
| Dividends paid ($M) | $0 | $(52) | n/a |
Operating cash flow was essentially flat despite higher net income, as working capital consumed some of the gain. However, capex fell, lifting free cash flow. Garrett returned virtually all of that free cash — and then some — to shareholders through buybacks and its first meaningful dividend program.
How strong is Garrett Motion's balance sheet?
Garrett carries significant debt, but it is manageable relative to earnings and has no major maturities until 2032.
| Item | 2024 | 2025 | Change |
|---|---|---|---|
| Total debt (principal, $M) | $1,493 | $1,439 | -3.6% |
| Cash and equivalents ($M) | $125 | $177 | +41.6% |
| Net debt ($M) | $1,368 | $1,262 | -7.7% |
| Undrawn revolving credit facility ($M) | $600 | $630 | +5.0% |
Debt is declining gradually, and the maturity schedule is back-end loaded — over $1.4 billion isn't due until 2032. Combined with a $630 million undrawn revolving credit line, near-term liquidity looks comfortable.
The company operates with a stockholders' deficit, a legacy of its 2021 bankruptcy emergence, but the retained deficit is shrinking.
| Item | 2024 | 2025 | Change |
|---|---|---|---|
| Retained deficit ($M) | $(1,653) | $(1,384) | improved by $269M |
| Total stockholders' deficit ($M) | $(673) | $(802) | worsened by $129M |
Net income is steadily reducing the retained deficit. However, total stockholders' deficit widened because $208 million in share buybacks and a large swing in other comprehensive loss (driven by currency and derivative mark-to-market moves) more than offset the year's profits. The deficit on the balance sheet is a technical accounting outcome of the company's history rather than a sign of current financial distress.