Commercial Vehicle Group’s third quarter results reflected continued softness in key end markets, notably North American Class 8 trucks, which management said led to lower sales across its Global Seating and Trim Systems. CEO James Ray cited “very challenging market environment” as the company’s operational efficiency improvements partially offset volume weakness. Ray specifically highlighted that “the continued improvement in profitability was again driven by the operational efficiency improvement initiatives,” even as the company navigated declining revenues and persistent macroeconomic uncertainty.
Is now the time to buy CVGI? Find out in our full research report (it’s free for active Edge members).
Commercial Vehicle Group (CVGI) Q3 CY2025 Highlights:
- Revenue: $152.5 million vs analyst estimates of $156.3 million (11.2% year-on-year decline, 2.4% miss)
- Adjusted EPS: -$0.14 vs analyst expectations of -$0.12 (16.7% miss)
- Adjusted EBITDA: $4.6 million vs analyst estimates of $4.76 million (3% margin, relatively in line)
- The company dropped its revenue guidance for the full year to $645 million at the midpoint from $660 million, a 2.3% decrease
- EBITDA guidance for the full year is $18 million at the midpoint, below analyst estimates of $21 million
- Operating Margin: -0.7%, down from 1.7% in the same quarter last year
- Market Capitalization: $52.66 million
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Commercial Vehicle Group’s Q3 Earnings Call
- Joseph Gomes (NOBLE Capital): Asked about the sustainability of headcount and capex reductions, and whether further cuts would impact operations. CEO James Ray replied that there is still room for additional efficiency gains without sacrificing responsiveness, while CFO Andy Cheung noted capex would only increase with new program launches.
- Gomes (NOBLE Capital): Inquired about the larger reduction in EBITDA guidance relative to revenue. Cheung explained this was primarily due to deleveraging in the fixed-cost heavy Trim and Components segment, where falling volumes amplify margin impact.
- Gomes (NOBLE Capital): Questioned if new electrical programs could offset a continued Class 8 downturn in 2026. Ray said management expects new wins to help stabilize revenues, with margin improvements from cost actions helping to mitigate end-market declines.
- John Franzreb (Sidoti & Company): Asked when new electrical program ramps would reach full scale. Cheung said major customer ramps are expected in late 2026 through 2028, with some incremental benefit beginning next year.
- Gary Prestopino (Barrington Research): Requested clarity on specific new program launches in Global Electrical, and whether they were focused on electric or internal combustion vehicles. Ray clarified that the North American program is for autonomous vehicles and the European program is for internal combustion, with EV opportunities also in development.
Catalysts in Upcoming Quarters
In the coming quarters, our analysts will be monitoring (1) the pace at which new electrical programs ramp up and contribute to segment growth, (2) the company’s ability to sustain margin improvements through further cost actions, and (3) management’s progress in mitigating tariff impacts and securing customer price recoveries. Execution on these fronts will be critical for stabilizing results ahead of any broader end-market recovery.
Commercial Vehicle Group currently trades at $1.53, in line with $1.52 just before the earnings. In the wake of this quarter, is it a buy or sell? See for yourself in our full research report (it’s free for active Edge members).
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