ADNT 10-K & 10-Q changes, risk factors and insider trading

The global automotive industry has recentlycontinued experiencedto experience uncertainties due to changing macroeconomic conditions. Weakening consumer demand, impacted by new vehicle affordability and a high interest rate environment, among other factors, has resulted in lower automotive production volumes. The global adoption of electric vehicles by consumers has also slowed, creating disruptions in production scheduling. More specifically, the EMEA region is faced with overcapacity issues due to lower production volumes and resulting in pricing pressures. The EMEA region is also faced with intensifying competition from Chinese imports and lower exports to China as domestic brands expand in China. The Asia region is also experiencing higher competitive pressures from local OEMs in China who are penetrating the industry with new product offerings. These Chinese OEMs are producing vehicles at lower costs, resulting in pricing pressures on the supply chain base. Further, new relationships need to be developed in order to become the supplier of choice for these new OEMs in China along with careful assessment of which local OEMs are expected to exist and thrive over the long-term due to the competitive pressures. Adient strives to offset the impact of lower production volumes and price reductions through improved operational performance, including commercial negotiations with Adient’s customers and vendors and through other operational improvements that Adient can influence, however there is no guarantee that Adient will be able to sufficiently offset the impact of lower production volumesvolumes, price reductions, or to avoid more significant restructuring actions. The global automotive industry has also experienced significant volatility in the pastpast, dueand to some extent volatility persists in the current environment, related to supply chain disruptions, inflationary pressures, labor shortages, geopolitical uncertainties, high interest rates and foreign currency fluctuations. Although Adient's seating products have not typically been dependent directly on the components causing the supply chain disruptions, Adient has been directly impacted by lower production levels at the OEMs as a direct result of these disruptions. These disruptions have moderated in fiscal 2024,2025, but supply chains remain fragile and, in the past have led to unplanned downtime at Adient's production facilities, often with very little warning, which created operating inefficiencies and limited Adient's ability to adequately mitigate such inefficiencies. The automotive industry has also experienced a period of significant price volatility (generally resulting in an increase in commodities, energy costs, freight costs, labor costs and other input costs), as well as encountering an environment of unfavorable foreign currency exposures and rising interest rates. While some of these input cost increases have moderated in fiscal 2024,2025, other exposures will likely continue into fiscal 20252026 and perhaps further into the future. This environment of significant price volatility has resulted in, and may continue to result in, increased costs for Adient that may not be, or may only be partially, offset. Adient also experienced constrained labor availability which has resulted in wage inflationary pressures, both internally and at key vendors. Adient continues to assess any impact labor shortages and wage inflation might have on Adient's ability to perform its obligations. Although Adient has developed and implemented strategies to mitigate the impact of supply chain disruptions along with the impact of higher input and other costs, these strategies, together with commercial negotiations with Adient's customers and suppliers, typically offset only a portion (less than 100%) of the adverse impact. Additionally, Adient's operating model requires long lead times between the design and development of products and the launch of production. This lead time requires Adient to secure vendor supply well in advance to minimize launch and production inefficiencies. During such lead times, price commitments are subject to change and could lead to an inability of Adient to fully recover all such price changes.

Adient's financial performance depends, in part, on conditions in the automotive industry. Automotive production and sales are highly cyclical and depend on general economic conditions and other factors, including consumer spending and preferences. Automakers may experience a decline in the number of new vehicle sales, whether as a result of economic decline, vehicle affordability, disruptions as a result of changes to trade policies, supply chain disruptions and labor shortages, increasing consumer borrowing rates or for various other reasons. Automakers may also become less cost competitive due to rising input costs, such as labor or raw materials, and thereby experience a loss of demand for their products as consumers shift to lower cost options. The Asia region in particular has experienced higher competitive pressures within the automotive industry from local OEMs in China who are penetrating the industry with new product offerings. These Chinese OEMs are producing vehicles at lower costs, resulting in pricing pressures on the supply chain base and among automaker competitors. As a result, Adient expects modest margin declines as Adient continues to win new business with local OEMs in China. Adient may also experience reductions in orders from these customers, incur write-offs of accounts receivable, incur impairment charges or require additional restructuring actions beyond its current restructuring plans, particularly if any of the automakers cannot adequately fund their operations or experience financial distress. Such adverse changes likely would have a negative impact on Adient's business, financial condition or results of operations. In addition, Adient relies in part on its customers’ forecasting of their expected needs, which forecasts can change rapidly and may not be accurate. Any inaccurate forecast data received by customers could also have an adverse impact on Adient’s results of operations.

As a result of macroeconomic factors impacting Adient and the automotive industry, Adient recorded a heightened$333 riskmillion ofnon-cash goodwill impairment existsdue forto a decline in the fair value of the EMEA reporting unit as the difference between its fair value and carrying value is less than 10% as of SeptemberMarch 30,31, 2024.2025. The decrease in EMEA’s fair value is driven by lower forecasted vehicle volumes from weakening consumer demand,demand due in part to vehicle affordability, slower consumer adoption of electric vehicles, overcapacity in the industry resulting in pricing pressure, intensifying competition from Chinese imports and lower exports to China from EMEA as domestic brands expand in China. AsThe aAmericas resultand Asia reporting units also showed significant declines in fair value, however, the differences between their fair values and carrying values both modestly exceeded 10% at March 31, 2025. The decrease in Americas' fair value is primarily attributable to the direct and indirect impacts stemming from the imposition of U.S. and foreign tariffs, and the heighteneddecrease riskin Asia's fair value is primarily attributable to market share loss for foreign/luxury OEMs in the region combined with modest expected margin declines as Adient continues to win new business with local OEMs in China. The fair values in both America and Asia reporting units show higher levels as of impairment,September 30, 2025 resulting in greater levels of fair value in excess of carrying values. Adient will continuously assess the changing macroeconomic conditions in EMEAall regions including the outlook for consumer demand for vehicles and other factors impacting the region, along with the need for further restructuring actions, all of which impact Adient’s ability to achieve its projected long-term operating performance. Refer to Note 6, “Goodwill and Other Intangible Assets,” of the notes to the consolidated financial statements for additional information.

Adient has several joint ventures worldwide and may enter into additional joint ventures in the future. Adient's joint venture partners may at any time have economic, business or legal interests or goals that are inconsistent with Adient's goals or with the goals of the joint venture which could lead to, among other things, dissolution, liquidation and/or modification of the joint venture terms. Adient may compete against its joint venture partners in certain of its markets and certain negotiations with its customers may negatively impact its joint venture business with those same customers. Disagreements with Adient's business partners may impede Adient's ability to maximize the benefits of its partnerships and/or may consume management time and other resources to negotiate, and which could lead to, among other things, dissolution, liquidation and/or modification of the joint venture terms. Adient's joint venture arrangements may require Adient, among other matters, to pay certain costs or to make certain capital investments or to seek its joint venture partner's consent to take certain actions. Adient does not control the ability to collect cash dividends from its non-consolidated joint ventures. In addition, Adient does not control the financial reporting of its non-consolidated joint ventures, which may impact its ability to complete its financial statements in a timely or accurate manner. Delays in the collection of dividends, even by a few days, could adversely affect Adient's financial position and cash flows. Adient's joint venture partners may be unable or unwilling to meet their economic or other obligations under the operative documents, and Adient may be required to either fulfill those obligations alone to ensure the ongoing success of a joint venture or to dissolve and liquidate a joint venture. Further, joint venture partnerships are subject to renewal or expiration at various times. The failure to renew or extend the terms of Adient’s joint venture partnerships could impact other areas of Adient’s business, including its business relationships. The above risks, if realized, could result in a material adverse effect on Adient's business and financial results.

Furthermore, non-consolidated joint ventures present various risks, including the risk that Adient plcmay |be Formslower 10-Kor |less 14able to identify or react to problems affecting its non-consolidated joint ventures than Adient would for a wholly-owned subsidiary or consolidated joint venture. In addition, these arrangements may cause Adient to be slower to detect compliance related problems and make its design of effective internal controls more challenging. Each of these challenges may be more costly to implement, and the risk of failure potentially higher, than would be the case in a more centralized structure. Depending on the nature of the problems, the failure to identify, detect or react could materially adversely affect Adient’s business, financial condition or results of operations.

Russia’s invasion of Ukraine in February 2022 resulted in significant uncertainty and instability in global supply chains and availability of certain commodities and raw materials. Although Adient has no operations in Ukraine and its operation in Russia has since been disposed, certain of its suppliers as well as customers depend on commodities and other material supplies that originate in Ukraine or Russia. In response to Russia’s invasion in Ukraine, a number of countries, including the United States, the United Kingdom and members of the European Union, have implemented economic sanctions on Russia and certain Russian enterprises including several large banks. The conflict also led to increases in the cost of energy and the potential for energy shortages, especially in Europe. If the conflict continues or expands, it may trigger a series of additional economic and other sanctions which in turn could further disrupt the global automotive supply chains by limiting supplies of key components and increasing inflationary pressures. This ongoing conflict, along with other geopolitical uncertainties such as the currentongoing conflict in the Middle East, could have broader adverse impacts on macroeconomic factors that impact Adient's business, cash flows, financial condition and results of operations.

Maintaining a strong position in the Chinese market is a key component of Adient's strategy. Adient's business in China is conducted through both consolidated subsidiaries and nonconsolidated joint ventures. The automotive supply market in China is highly competitive, with competition from many of the largest global manufacturers and numerous smaller domestic manufacturers. As the size of the Chinese market evolves and as Chinese OEMs penetrate other markets around the globe, often with lower-cost products, Adient anticipates that market participants will act aggressively to increase or maintain their market share. Increased competition may result in price reductions, reduced margins and Adient's inability to gain or hold market share. Further, new relationships need to be developed in order to become the supplier of choice for the new Chinese OEMs, along with careful assessment of which local OEMs will exist and thrive over the long-term due to the competitive pressures within the industry. In addition to the risks imposed by U.S. economic trade policy discussed further below, Adient's business in China is sensitive to economic, political and market conditions that drive automotive sales volumes in China. If Adient is unable to maintain its position in the Chinese market, or if vehicle sales in China decrease or do not continue to increase, then Adient's business and financial results may be adversely affected. Also, if Chinese OEMs continue to expand into other markets and regions, Adient’s business and financial results may be adversely affected if Adient does not have the same level of content on Chinese OEM vehicles.

ChangesRecent changes in U.S. administrative policy, including changesincreases toin existing trade agreementstariffs and any resulting changes in international trade relations,relations or trade agreements, may have an adverse effect on Adient.

There is continued uncertainty about the future relationship between the U.S. and various other countries, most significantly China,countries with respect to tariffs, trade policies, treaties, government regulationsregulations, treaties and tariffs.trade Changesagreements. Recent changes in U.S. administrative policy couldhave leadled to changes to existing trade agreements, greater restrictions on free trade generally, prohibitions or restrictions on the import of certain automobiles and components into the U.S. and significant increases in tariffs on goods imported into the U.S., particularly tariffs on products manufactured in Europe, Mexico and China,China. These tariffs, and additional proposed tariffs or other restrictive changes, have resulted, and may further result, in retaliatory trade measures in response to such actions and ongoing uncertainty regarding existing trade agreements, greater restrictions on free trade generally, and prohibitions or restrictions on the import of certain automobiles and components into the U.S., among other possible changes. A trade war, otherFurther governmental action related to tariffs or international trade agreements, a trade war, changes in U.S. social, political, regulatory and economic conditions or in laws and policies governing foreign trade, manufacturing, development and investment in the territories and countries where Adient currently manufactures and sells products, and any resulting negative sentiments towards the U.S. as a result of such changes, would likely would have an adverse effect on Adient's business, financial condition or results of operations. To the extent that Adient incurs incremental tariffs, Adient will need to recover such tariffs from its customers, and there is no guarantee such recoveries will occur. As of September 30, 2025, Adient’s results were negatively impacted by $17 million, net of recoveries, related to the recent enactment of U.S. tariffs.

Raw material, energy, commodity, freight and labor costs can be volatile. Although Adient has developed and implemented strategies to mitigate the impact of higher raw material, energy, commodity, freight and labor costs, these strategies, together with commercial negotiations with Adient's customers and suppliers, may only offset a portion of the adverse impact. Certain of these strategies also may limit Adient's opportunities in a declining commodity environment. In addition, the availability of raw materials, commodities, transportation and product components fluctuates from time to time due to factors outside of Adient's control. Due to a variety of global factors, the automotive industry has experienced, and may continue to experience, supply chain disruptionsdisruptions, mainly from another automotive suppliers, due to production downtime and insufficient availability of raw materials, components and labor. As a result of these disruptions, the automotive industry has seen volatility in the volume of automobile production, which has resulted in, and may continue to result in, decreased sales, without a corresponding decrease in labor costs, for Adient. In addition, the automotive industry has seen periods of price increases for commodities, primarily related to steel, and to a lesser extent petrochemicals, and energy costs in Europe. Adient has also experienced constrained labor availability which has resulted in wage inflationary pressures, both internally and at key vendors. Given the United Auto Workers’ (“UAW”) strategy of targeted strikes, Adient may see increased pressure for wage and benefit increases in the U.S. These increases may continue into the future as demand increases and as supply may remain constrained, which has resulted in, and may continue to result in, increased costs for Adient. If the costs of raw materials, energy, commodities, freight costs, labor costs and product components increase or the availability thereof is restricted, it could adversely affect Adient's financial condition, operating results and cash flows.

Adient operates in the highly competitive automotive supply industry.industry which requires capital expenditures to support customer launch plans and growth.

The global automotive component supply industry is highly competitive. Competition is based primarily on price, technology, quality, delivery and overall customer service. There can be no assurance that Adient's products will be able to compete successfully with the products of Adient's competitors. Furthermore, the rapidly evolving nature of the markets in which Adient competes, including asthe aevolution resulttowards ofelectric vehicles along with the autonomous vehicle market and consumer preferences for mobility on demand services, such as car- and ride-sharing, may attract new entrants. Additionally, consolidation in the automotive industry may lead to decreased product purchases from Adient.

As a result, Adient's sales levels and margins could be adversely affected by pricing pressures from OEMs and pricing actions of competitors. In addition, Adient is required to spend capital resources to facilitate growth as automotive markets evolve; however, there is no guarantee that profitable growth will occur as a result of such expenditures due to customer platform sales and performance. These factors may also lead to selective resourcing of business to competitors. Adient's competitors may develop, design or duplicate technologies that compete with Adient's owned or licensed intellectual property. Developments or assertions by or against Adient relating to intellectual property rights, or any inability to protect Adient's rights, could have an adverse impact on its business and competitive position. In addition, any of Adient's competitors may foresee the course of market development more accurately than Adient, develop products that are superior to Adient's products, produce similar products at a lower cost than Adient, or adapt more quickly than Adient to new technologies or evolving customer requirements. Adient cannot provide assurances that certain of Adient’s products will not become obsolete or that Adient will be able to achieve the technological advances that may be necessary to remain competitive. As a result, Adient's products may not be able to compete successfully with its competitors' products and Adient may not be able to meet the growing demands of customers.customers or achieve its sales and profitability growth targets. In addition, Adient’s customers may increase levels of production insourcing for a variety of reasons, such as shifts in customers’ business strategies or the emergence of low-cost production opportunities in other countries. These trends may adversely affect Adient's sales as well as the profit margins on Adient's products.

Adient's business faces the production demands and requirements of its OEM customers, as described in Item 1, "“Business"” of this Annual Report on Form 10-K. As a result of safety and environmental regulations, as well as a trend of more rapid customer preference changes, OEMs are requiring suppliers like Adient to respond faster with new designs and product innovations. A significant failure or inability to comply with customer specifications and manufacturing requirements or delays or other problems with existing or new products often results in financial penalties, increased costs, loss of sales, loss of customers or potential breaches of customer contracts, which likely would have an adverse effect on Adient's profitability and results of operations.

Because the automotive industry relies heavily on just-in-time delivery of components during the assembly and manufacture of vehicles, a work stoppage at one or more of Adient's manufacturing and assembly facilities could have adverse effects on the business. Similarly, if one or more of Adient's customers were to experience a work stoppage, such as what occurred during the UAW strike in the U.S. in late 2023,stoppage resulting in ongoing supply chain disruptions, or otherwise, that customer would likely halt or limit purchases of Adient's products, which could result in the shutdown of the related Adient manufacturing facilities and /or other cost-reduction initiatives. In certain instances, Adient may be unable to adjust its staffing levels to correspond to a customer’s work stoppage such that Adient incurs increased labor costs along with a decrease in production. A significant disruption in the supply of a key component due to a work stoppage at one of Adient's suppliers or any other supplier could have the same consequences, and accordingly, have an adverse effect on Adient's financial results.

In order to align Adient's resources with its strategies, operate more efficiently and control costs and to realign its businesses, with customer and market needs and operating conditions, Adient has periodically announced, and in the future may continue to announce, restructuring plans, which may include workforce reductions, global plant closures and consolidations, asset impairments and other cost reduction initiatives. In each of the last sixseven fiscal years, Adient announced restructurings related to cost reduction initiatives, which included workforce reductions, plant closures and asset impairments. Adient may undertake additional restructuring actions, including plant closures and workforce reductions in the future, particularly in EMEA where Adient is closely monitoring macroeconomic conditions and customer production plans. As these plans and actions are complex, unforeseen factors could result in expected savings and benefits to be delayed or not realized to the full extent planned (if at all), and Adient's operations and business may be disrupted, which likely would adversely affect Adient's financial condition, operating results and cash flow. Furthermore, to the extent such initiatives involve workforce changes, such changes may temporarily reduce workforce productivity, which could be disruptive to Adient’s business and adversely affect results of operations.

Adient plcis |increasingly Formincorporating 10-Kautomation |and 18artificial intelligence capabilities into the development of technologies and business operations, and into products and services. Artificial intelligence technology is complex and rapidly evolving, and may subject Adient to significant competitive, legal, regulatory, operational and other risks. The implementation of artificial intelligence can be costly and there is no guarantee that Adient’s use of artificial intelligence will enhance its technologies, benefit its business operations, or produce products and services that are preferred by its customers. Adient’s competitors may be more successful in their artificial intelligence strategy and develop superior products and services with the aid of artificial intelligence technology. Additionally, artificial intelligence algorithms or training methodologies may be flawed, and datasets may contain irrelevant, insufficient or biased information, which can cause errors in outputs. This may give rise to legal liability, reputational damage, and materially harm Adient’s business. The use of artificial intelligence in the development of Adient’s products and services could also cause loss of intellectual property, as well as subject it to risks related to intellectual property infringement or misappropriation, data privacy and cybersecurity. Additionally, market adoption of artificial intelligence technology could be impaired by ethical and other issues inherent in the technology, which could impair demand for Adient’s products and services. Furthermore, the U.S. and other countries may adopt laws and regulations related to artificial intelligence. Such laws and regulations could cause Adient to incur greater compliance costs and limit the use of artificial intelligence in the development of its products and services. Any failure or perceived failure by Adient to comply with such regulatory requirements could subject Adient to legal liabilities, reputational damage, or otherwise have a material and adverse impact on Adient’s business.

Adverse changes in the underlying profitability and financial outlook of Adient's operations in several jurisdictions could lead to additional changes in Adient's valuation allowances against deferred tax assets and other tax reserves on Adient's statements of financial position. Additionally, changes in tax laws in Ireland, the U.S. or in other countries where Adient has significant operations could materially affect deferred tax assets and liabilities on Adient's statements of financial position and income tax provision on Adient's statements of income.income (loss).

Adient is also subject to tax audits for both direct and indirect taxes by governmental authorities on a worldwide basis. Governmental authorities have become more aggressive in proposing tax assessments, including interest related to income taxes and transaction taxes such as Value Added Tax (“VAT”). NegativeAdient unexpectedhas resultsbeen fromexperiencing oneincreased orlevels of discussions with taxing authorities and more suchaggressive negotiations by the tax authorities as part of tax audits couldand adverselyrelated affectinquiries, Adient'srequiring resultsincreased levels of operations.management's focus and attention and resulting in higher levels of uncertainty on tax assessment outcomes. Subsequent to September 30, 2025, Adient initiated a foreign tax audit settlement proposal which, although still under

The automotive industry is increasinglyremains focused on the development of advanced driver assistance technologies, with the goal of developing and introducing a commercially-viable, fully automated driving experience. There hasare also been an increase invarying consumer preferences for mobilitymobility-on-demand onservices demand services,— such as car- and ride-sharing,ride-sharing — as opposed to automobile ownership, in part resulting from the evolution of the electric vehicle, which may result in a long termlong-term reduction in the number of vehicles per capita. These evolving areas have also attracted increased competition from entrants outside the traditional automotive industry. If Adient does not continue to innovate to develop or acquire new and compelling products that capitalize upon new technologies in response to OEM and consumer preferences, this could have an adverse impact on Adient’s results of operations.

Adient may incur material losses and costs as a result of warranty and product recall claims and product liability actions that may be brought against Adient.

Adient faces an inherent business risk of exposure to warranty and product recall claims and product liability in the event that its products fail to perform as expected and, in the case of product liability, such failure of its products results, or is alleged to result, in bodily injury and/or property damage. Seating systems are safety critical components of vehicles, particularly when safety features are incorporated into seating systems such as side airbags and other restraining systems. Therefore, any failure to produce seating systems that meet safety specifications puts Adient at risk of higher warranty, recall or product liability expense. While Adient will maintain reasonable limits of insurance coverage to appropriately respond to such exposures, large product liability claims, if made, could exceed Adient's insurance coverage limits and insurance may not continue to be available on commercially acceptable terms, if at all. Adient may incur significant costs to defend these claims or experience product liability losses in the future. If any of Adient's products are or are alleged to be defective, Adient may be required to participate in a recall involving such products. As suppliers become more integrally involved in the vehicle design process and assume more of the vehicle assembly functions, auto manufacturers are increasingly looking to their suppliers for contribution when faced with recalls and product liability claims. A recall claim brought against Adient that is not insured, or a product liability claim brought against Adient in excess of its available insurance, could have an adverse impact on Adient's results of operations. In addition, a recall claim could require Adient to review its entire product portfolio to assess whether similar issues are present in other product lines, which could result in significant disruption to Adient's business and could have an adverse impact on Adient's results of operations.

Auto manufacturers are also increasingly requiring their suppliers to guarantee or warrant their products and bear the costs of repair and replacement of such products under new vehicle warranties. Depending on the terms under which Adient supplies products to an auto manufacturer, an auto manufacturer may attempt to hold Adient responsible for some or all of the repair or replacement costs of defective products under new vehicle warranties, when the vehicle manufacturer asserts that the product supplied did not perform as warranted.

Although Adient cannot assure that the future costs of warranty and product recall claims by its customers and product liability claims will not be material, Adient believes its established reserves are adequate to cover potential settlements. Adient's reserves are based on Adient's best estimates of amounts necessary to settle future and existing claims. Adient regularly evaluates the level of these reserves, and adjusts them when appropriate. However, the final amounts determined to be due related to these matters could differ materially from Adient's recorded estimates.

Increased public awareness and concern regarding global climate change may result in more regional and/or federal requirements to reduce or mitigate the effects of greenhouse gas emissions. There continues to be a lack of consistent climate legislation, which creates economic and regulatory uncertainty. Such regulatory uncertainty extends to future incentives for energy efficient vehicles and costs of compliance, which may impact the demand for Adient's products and Adient's results of operations.

Significant changes in actual investment return on defined benefit plan assets, discount rates, mortality assumptions and other factors could adversely affect Adient's results of operations and the amounts of contributions Adient must make to its defined benefit plans in future periods. For example, Adient has recorded mark-to-market adjustments on the revaluation of its pension obligations that have significantly impacted its overall results in the past two years.past. Generally accepted accounting principles in the U.S. require that Adient calculate income or expense for the plans using actuarial valuations. These valuations reflect assumptions about financial markets and interest rates, which may change based on economic conditions. Funding requirements for Adient's defined benefit plans are dependent upon, among other factors, interest rates, underlying asset returns and the impact of legislative or regulatory changes related to defined benefit funding obligations.

Adient's ability to sustain and grow its business requires it to hire, retain and develop a highly skilled and diverse management team and workforce. Failure to ensure that Adient has the leadership capacity with the necessary skill set and experience could impede Adient's ability to deliver its growth objectives and execute its strategic plan. Organizational and reporting changes as a result of any future leadership transition and corporate initiatives, including restructuring actions, could result in increased turnover. Additionally, any unplanned turnover or inability to attract and retain key employees could have a negative effect on Adient's results of operations. Further, certain of the recentpast austerity measures related to employee compensation, along with the on-going unpredictability of production schedules, could result in employees pursuing other employment opportunities outside of Adient.

Adient obtains components and other products and services from numerous automotive suppliers and other vendors throughout the world. In addition, Adient is party to various arrangements with third parties who owe Adient money or goods and services, or who purchase goods and services from Adient. Adient is responsible for managing its supply chain, including suppliers that may be the sole sources of products that Adient requires, which Adient's customers direct Adient to use or which have unique capabilities that would make it difficult and/or expensive to re-source. In addition, with fewer sources of supply for certain components, each supplier may perceive that it has greater leverage and, therefore, some ability to seek higher prices at a time that Adient faces substantial pressure from OEMs to reduce the prices of Adient’s products. This could adversely affect customer relations and business. In certain instances entire industries may experience short-term capacity constraints. Additionally, Adient's production capacity, and that of Adient's customers and suppliers, may be adversely affected by natural disasters. Any such significant disruption could adversely affect Adient's financial performance. Unfavorable economic or industry conditions could also result in financial distress within Adient's supply chain or among other third-party counterparties, thereby increasing the risk of supply disruption or lost orders. Although market conditions generally have improved in recent years, uncertainty remains and another economic downturn or other unfavorable industry conditions in one or more of the regions in which Adient operates could cause a supply disruption or loss of customer orders and thereby adversely affect Adient's financial condition, operating results and cash flows.

Adient plccurrently |does Formnot 10-Khave |plans 22to pay dividends on its ordinary shares. The timing, declaration, amount and payment of future dividends to shareholders will fall within the discretion of Adient's Board of Directors. The Board's decisions regarding the payment of dividends will depend on many factors, such as Adient's financial condition, earnings, sufficiency of distributable reserves, capital requirements, debt service obligations, legal requirements, regulatory constraints and other factors that the board deems relevant. Adient's ability to pay dividends will depend on its ongoing ability to generate cash from operations and access capital markets. Adient cannot guarantee that it will pay dividends in the future which may impact Adient’s investor base.

Any of the following could adversely impact Adient's results of operations: the inability of Adient to execute continued turnaround actions to improve profitability; the loss of, or changes in, automobile supply contracts, sourcing strategies or customer claims with Adient's major customers or suppliers; increased freight or shipping costs resulting from extreme weather conditions or supply chain disruptions, lack of commodity availability and unfavorable commodity pricing; start-up expenses associated with new vehicle programs or delays or cancellations of such programs; underutilization of Adient's manufacturing facilities, which are generally located near, and devoted to, a particular customer's facility; inability to recover engineering and tooling costs; market and financial consequences of any recalls that may be required on products that Adient has supplied or sold into the automotive aftermarket; delays or difficulties in new product development and integration; quantity and complexity of new program launches, which are subject to Adient's customers' timing, performance, design and quality standards; interruption of supply of certain single-source components; the potential introduction of similar or superior technologies; changing nature and prevalence of Adient's joint ventures and relationships with its strategic business partners; global overcapacity and vehicle platform proliferation; and the implementation of new internal control systems and procedures that fail to achieve accurate financial reporting or that fail to prevent fraudulent activity (such as vendor payments to fraudulent bank accounts).

A judgment obtained against Adient plcwill |be Formenforced 10-Kby |the 23courts of Ireland if the following general requirements are met: (i) U.S. courts must have had jurisdiction in relation to the particular defendant according to Irish conflict of law rules (the submission to jurisdiction by the defendant would satisfy this rule) and (ii) the judgment must be final and conclusive and the decree must be final and unalterable in the court which pronounces it. A judgment can be final and conclusive even if it is subject to appeal or even if an appeal is pending. Where however the effect of lodging an appeal under the applicable law is to stay execution of the judgment, it is possible that in the meantime the judgment may not be actionable in Ireland. It remains to be determined whether final judgment given in default of appearance is final and conclusive. However, Irish courts may refuse to enforce a judgment of the U.S. courts which meets the above requirements for one of the following reasons: (i) if the judgment is not for a definite sum of money; (ii) if the judgment was obtained by fraud; (iii) the enforcement of the judgment in Ireland would be contrary to natural or constitutional justice; (iv) the judgment is contrary to Irish public policy or involves certain U.S. laws which will not be enforced in Ireland; or (v) jurisdiction cannot be obtained by the Irish courts over the judgment debtors in the enforcement proceedings by personal service in Ireland or outside Ireland under Order 11 of the Ireland Superior Courts Rules.

Under current law, Adient is expected to be treatedcharacterized as a foreign corporation for U.S. federal tax purposes and Section 7874 isdoes not otherwise expected to apply to Adient or its affiliates as a result of the separation from Johnson Controls International plc (the “Former Parent”) in 2016. However, changes to the rules contained in Section 7874 and the Treasury Regulations promulgated thereunder, or other changes in law, could adversely affect Adient's and/or its affiliates' status as foreign corporations for U.S. federal tax purposes, the ability of Adient's U.S. affiliates to use certain attributes or deductions, the Adient group's effective tax rate and/or future tax planning for the Adient group, and any such changes could have prospective or retroactive application to Adient, its shareholders and affiliates, and/or the separation and distribution from the Former Parent.

Prior legislative and other proposals have aimed to expand the scope of U.S. corporate tax residence. Under such proposals, Adient and/or its affiliates could be treated as U.S. corporations if the management and control of Adient or such affiliates were determined to be located primarily in the U.S. In addition, prior legislative and other proposals have aimed to expand the scope of Section 7874, or otherwise address certain perceived issues arising in connection with so-called inversion transactions. Such proposals, if made retroactively effective to transactions completed during the period in which the separation from the Former Parent occurred,proposals could cause Adient and/or its affiliates to be treated as U.S. corporations for U.S federal tax purposes. If enacted, such proposals could cause the Adient group to be subject to substantially greater U.S. tax liability than currently contemplated.

Adient’s articles of association include measures that may be found in the charters of U.S. companies and that could have the effect of deterring coercive takeover practices, inadequate takeover bids and unsolicited offers. These provisions include, among others: (i) the power for the Board of Directors to issue and allot preferred shares or implement a shareholder rights plan without shareholder approval in certain circumstances; (ii) a provision similar to Section 203 of the Delaware General Corporation Law, which provides that, subject to limited exceptions, persons that acquire, or are affiliated with a person that acquires, more than 15 percent of the outstanding ordinary shares of Adient shall not engage in any business combination with Adient, including by merger, consolidation or acquisitions of additional shares, for a three-year period following the date on which that person or its affiliates becomes the holder of more than 15 percent of Adient's outstanding ordinary shares; (iii) rules regarding how shareholders may present proposals or nominate directors for election at shareholder meetings; and (iv) the ability of the Adient Board of Directors to fill vacancies on the Board of Directors in certain circumstances.

Adient has made statements in this section and other parts of this Annual Report on Form 10-K that are management’s perspective of forward-looking information and, therefore, are subject to risks and uncertainties. All statements in this Form 10-K other than statements of historical fact are statements that are, or could be, deemed "“forward-looking statements"”, within the meaning of the Private Securities Litigation Reform Act of 1995. In this Form 10-K, statements regarding Adient's future financial position, sales, costs, earnings, cash flows, other measures of results of operations, capital expenditures or debt levels and plans, objectives, outlook, targets, guidance or goals are forward-looking statements. Words such as "“future,"” "“may,"” "“will,"” "“would,"” "“could,"” "“can,"” "“expect,"” "“intend,"” "“estimate,"” "“anticipate,"” "“believe,"” "“should,"” "“forecast,"” "“predict,"” "“project"” or "“plan"” or terms of similar meaning are also generally intended to identify forward-looking statements. Adient cautions that these statements are subject to numerous important risks, uncertainties, assumptions and other factors, some of which are beyond Adient’s control, that could cause Adient’s actual results to differ materially from those expressed or implied by such forward-looking statements, including, among others, risks related to: the effects of local and national economic, credit and capital market conditions (including the persistence of high interest rates, vehicle affordability and volatile currency exchange rates) on the global economy, increased competitive pressures in the EMEA and Asia regions from Chinese OEMs, uncertainties in U.S. administrative policy regarding trade agreements, tariffs and other international trade relations, automotive vehicle production levels, mix and schedules, as well as the concentration of exposure to certain automotive manufacturers,manufacturers particularly new entrants in the China market, shifts in market shares among vehicles, vehicle segments or away from vehicles on which Adient has significant content, changes in consumer demand, risks associated with Adient’s joint ventures, volatile energy markets, Adient’s ability and timing of customer recoveries for increased input costs, the availability of raw materials and component products (including components required by Adient’s customers for the manufacture of vehicles), risks associated with warranty and product recall and product liability exposures, geopolitical uncertainties such as the Ukraine and Middle East conflicts and the impact on the regional and global economies and additional pressure on supply chain and vehicle production, uncertainties in U.S. administrative policy regarding trade agreements, tariffs and other international trade relations, the ability of Adient to effectively launch new business at forecast and profitable levels, the ability of Adient to successfully identify suitable opportunities for organic investment and/or acquisitions and to integrate such investments and/or acquisitions, work stoppages, including due to strikes, supply chain disruptions and similar events, wage inflationary pressures due to labor shortages and new labor negotiations, the ability of Adient to execute its restructuring plans and achieve the desired benefit, the ability of Adient to meet debt service requirements and,and terms of future financing, the impact of global tax reform legislation, the impact of more aggressive positions taken by tax authorities, potential adjustment of the value of deferred tax assets, global climate change and related emphasis on sustainability matters by various stakeholders, and the ability of Adient to achieve its sustainability-related goals, cancellation ofof, or changes toto, commercial arrangements, and the ability of Adient to identify, recruit and retain key leadership. Factors that might cause differences include, but are not limited to, those discussed in Part 1, Item 1A of this Form 10-K under the heading "“Risk Factors,"” which are incorporated herein by reference. All information presented herein is based on Adient's fiscal calendar. Unless otherwise stated, references to particular years, quarters, months or periods refer to Adient's fiscal years ended in September and the associated quarters, months and periods of those fiscal years. The forward-looking statements included in this Form 10-K are made only as of the date of this report, unless otherwise specified, and, except as required by law, Adient assumes no obligation, and disclaims any obligation, to update such statements to reflect events or circumstances occurring after the date of this Form 10-K.

Adient designs, manufactures and markets a full range of seating systems and components for passenger cars, commercial vehicles and light trucks, including vans, pick-up trucks and sport/crossover utility vehicles. Adient operates more thanapproximately 200 wholly- and majority-owned manufacturingmanufacturing, assembly or assemblysequencing facilities, with operations in 29 countries. Additionally, Adient has partially-owned affiliates in China, Asia, Europe and North America. Through its global footprint and vertical integration, Adient leverages its capabilities to drive growth in the automotive seating industry.

Adient plcevaluates |the Formperformance 10-Kof |its 31reportable segments using an adjusted EBITDA metric defined as income (loss) before income taxes and noncontrolling interests, excluding net financing charges, restructuring and impairment costs, restructuring-related costs, net mark-to-market adjustments on pension plans, transaction gains/losses, purchase accounting amortization, depreciation, stock-based compensation and other non-recurring items (“Adjusted EBITDA”). Also, certain corporate-related costs are not allocated to the segments. The reportable segments are consistent with how management views the markets served by Adient and reflect the financial information that is reviewed by its chief operating decision maker. Refer to Note 17, "“Segment Information,"” of the notes to the consolidated financial statements for additional information on Adient's reportable segments.

Adient conducts its business globally in the automotive industry, which is highly competitive and sensitive to economic, political and social factors in the various regions. During fiscal 2024,2025, global light vehicle production increased 1.5%,3.0%, driven by improved vehicle sales and stronger export activity in China, partially offset by reduced production volumes predominately in China.North America and EMEA. The current operating environment varies by region, being impacted by weakening consumer demand due to new vehicle affordability and high interest rates along with slower electric vehicle adoption rates.

•Adient recorded net sales of $14,688$14,535 million for fiscal 2024,2025, representing a decrease of $707$153 millionmillion, or 1.0%, when compared to fiscal 2023.2024. The decrease in net sales is primarily attributable to Adient's lower overall production volumes in all regions, the unfavorable impact of foreign currencies, and unfavorable material economics recoveries, partially offset by favorable net pricing adjustments.EMEA,

•Gross profit was $961 million, or 6.6% of net sales, for fiscal 2025 compared to $928 million, or 6.3% of net sales for fiscal 2024 compared to $1,033 million, or 6.7% of net sales for fiscal 2023.2024. Profitability, including gross profit as a percentage of net sales, was lowerhigher due primarily to favorable commercial and supplier pricing adjustments and operating performance, more than offsetting lower overall production volumes in all regions, thevolumes, unfavorable impactproduct mix and unfavorable material economics, net of foreign currencies, unfavorable operating performance in EMEA, unfavorablerecoveries.

•Equity income was $68 million for fiscal 2025, compared to $90 million for fiscal 2024,2024. whichThe comparesdecrease is due primarily to equitythe income of $84 million for fiscal 2023. The increase is primarily attributable to favorable operating performance at partially-owned affiliates, partially offset by theunfavorable impact of the KEIPER supply agreement modificationsmodifications, executedpartially inoffset fiscalby 2023higher production volumes and thefavorable unfavorableoperating impact of foreign currencies.performance.

Net sales decreased by $707$153 million, or 5%,1%, during fiscal 20242025 as compared to fiscal 20232024 due to lower overall production volumes in allEMEA regionsas thata areresult resulting fromof softening consumer demanddemand, net of higher production volumes in Americas and weaker product mix in EMEA along with slower than expected product launches and production disruptions at certain customers in the Americas including the impact of the United Auto WorkersAsia ("UAW") strike during the first fiscal quarter ($697$225 million), and unfavorable material economics recoveries ($93 million) and the unfavorable impact of foreign currencies ($16$59 million), partially offset by netthe favorable impact of foreign currencies ($104 million) and favorable commercial pricing adjustments which includes $28 million related to tariff recoveries ($99$27 million).

Net sales increaseddecreased by $1,274$707 million, or 9%,5%, induring fiscal 20232024 as compared to fiscal 20222023 due to higherlower overall production volumes in all operatingregions segmentsthat resulted from softening consumer demand and weaker product mix in EMEA along with slower than expected product launches and production disruptions at certain customers in the Americas including the impact of the United Auto Workers ($1,558“UAW”) strike ($697 million), unfavorable material economics recoveries ($93 million) and net favorable pricing adjustments ($141 million), partially offset by the unfavorable impact of foreign currencies ($301$16 million), andpartially unfavorableoffset materialby economicsnet recoveriesfavorable commercial pricing adjustments ($124$99 million).

Cost of sales decreased by $602$186 million, or 1%, and gross profit increased by $33 million, or 4%, and gross profit decreased by $105 million, or 10%, during fiscal 20242025 as compared to fiscal 2023.2024. The year over year decrease in cost of sales was primarily due to lower production volumes ($522 million), favorable material economics ($79 million), favorable operating performance driven by lower freight costs ($25$174 million), favorable supplier pricing adjustments ($20 million), the favorable impact of theincluding KEIPER supply agreement modifications ($8$70 million), favorable material economics ($31 million), favorable operating performance despite the $45 million unfavorable impact of tariffs ($27 million) and lower depreciation and amortization expense ($2$4 million), partially offset by non-recurring net benefits largely associated with insurance recoveries in fiscal 2023 ($29 million), the unfavorable impact of foreign currencies ($18$101 million), and higher restructuring relatedrestructuring-related charges ($5$19 million). Gross profit for fiscal 20242025 was unfavorably impacted by favorable commercial and supplier pricing adjustments, favorable operating performance, lower productiondepreciation volumes, non-recurring net benefits largely associated with insurance recoveries in fiscal 2023, unfavorable material economics, net of recoveriesexpense and the unfavorablefavorable impact of foreign currencies, partially offset by favorablelower operatingproduction performance.volumes and unfavorable product mix, unfavorable material economics, net of recoveries, unfavorable net tariff impact, and higher restructuring-related charges. Refer to the segment analysis below for a discussion of segment profitability.

Cost of sales increaseddecreased by $1,048$602 million, or 8%,4%, and gross profit increaseddecreased by $226$105 millionmillion, inor 10%, during fiscal 20232024 as compared to fiscal 2022.2023. The year-over-yearyear increaseover year decrease in cost of sales was primarily due to higherlower production volumes ($1,312$522 million), increasedfavorable utilitiesmaterial and labor costs along with operating inefficiencies associated with supply chain issueseconomics ($104$79 million), andfavorable theoperating impactperformance of fiscal 2022 gains associated with retrospective recoveries of Brazil indirect tax credits ($29 million), partially offsetdriven by thelower favorablefreight impact of foreign currenciescosts ($282$25 million), favorable supplier pricing ($69 million), non-recurring fiscal 2023 net benefits largely associated with insurance recoveriesadjustments ($29$20 million), the favorable impact of the KEIPER supply agreement modifications ($11$8 million), and lower depreciation expense ($6$2 million)., Grosspartially profit was favorably impactedoffset by higher overall production volumes, net favorable pricing adjustments, and non-recurring net benefits largely associated with insurance recoveries,recoveries in fiscal 2023 ($29 million), the unfavorable impact of foreign currencies ($18 million), and higher restructuring-related charges ($5 million). Gross profit for fiscal 2024 was unfavorably impacted by lower production volumes, non-recurring net benefits largely associated with insurance recoveries in fiscal 2023, unfavorable material economics, net of recoveries and the unfavorable impact of foreign currencies, partially offset by higherfavorable utilitiesoperating and labor costs, and unfavorable net material economics.performance.

Selling, General and Administrative Expenses (“SG&A”)

Restructuring and impairment costs were higher by $128 million during fiscal 2024 due to restructuring actions taken primarily in EMEA in response to the macroeconomic factors occurring in the European automotive market causing reduced production volumes and to ensure Adient maintains a competitive cost structure by reducing labor costs and increasing efficiencies. Adient also recorded a $9 million impairment on its Adient Aerospace investment in fiscal 2024 contributing to the increase year over year. Adient continues to monitor and assess market conditions within the automotive industry in each of its regions, with particular focus on EMEA in the near term, and will consider taking further restructuring action as needed to stay competitive and to position Adient to serve the needs of its customers.

Refer to Note 6, “Goodwill and Other Intangible Assets” and Note 15, "“Restructuring and Impairment Costs,"Costs” of the notes to the consolidated financial statements and the discussion under Liquidity and Capital Resources below for additional information related to the goodwill impairment recorded during fiscal 2025 and Adient's restructuring plans.

Equity income was $90 million for fiscal 2024, compared to $84 million for fiscal 2023. The increase is primarily attributable to favorable production volumes and operating performance at partially-owned affiliates ($17 million) and the non-recurrence of priorfiscal year2023 non-cash impairment charges recorded on certain of Adient's investments in non-consolidated affiliates ($3 million), partially offset by the impact of the KEIPER supply agreement modifications executed in fiscal 2023 ($8 million), and the unfavorable impact of foreign currencies ($5 million).

Other Pension Expense (Income)

Other pension expense (income) consists of mark-to-market, curtailment and settlement adjustments, and non-service components of net periodic pension costs of Adient's retirement plans. Other pension expense was lower by $16$11 million in fiscal 20242025 as compared to fiscal 20232024 due primarily to a $13$3 million current year mark-to-market loss (compared to a $19$13 million loss in fiscal 20232024) and an $8 million prior year curtailment loss primarily associated with employee termination benefit plans in the Americas segment..

TheOther higherpension expense was lower by $12 million in fiscal 20232024 expenseas compared to fiscal 2022 is2023 due primarily to a $19 million fiscal 2023lower mark-to-market loss (compared to a $8$13 million gain in fiscal 20222024 compared to $19 million in fiscal 2023), and an $8 million curtailment loss in fiscal 2023 primarily associated with employee termination benefit plans in the Americas segment, and higher pension interest expense. Refer to Note 14, "Retirement Plans," of the notes to the consolidated financial statements for information related to the components of Adient's net periodic pension costs.segment.

The fiscal 20242025 income tax expense of $32$103 million was higher than the Irish statutory rate of 12.5% primarily due to the inability to record a tax benefit for losses in jurisdictions with valuation allowances, the repatriation of foreign earnings, $17tax millionexpense ofrelated to adjustments to net operating loss deferred tax assets, tax expense related to foreign exchange remeasurements of tax balances primarily in Mexico and tax expense from the establishment of valuationuncertain allowancestax atpositions, certainforeign subsidiaries,tax rate differentials, and the impact of the impairment of the non-tax-deductible portion of the EMEA goodwill balance for which there is no corresponding income tax benefit, partially offset by tax benefits from the release of uncertain tax positions due to audit closures and fromstatute the release of valuation allowances at certain subsidiaries.expirations.

Given current earnings and anticipated future earnings at certain subsidiaries, Adient believes that there is a possibility that sufficient positive evidence may become available that would allow the release of all, or a portion of, valuation allowances at certain subsidiaries within the next twelve months. A release of valuation allowances, if any, would result in the recognition of certain deferred tax assets which could generate a material income tax benefit for the period in which such release is recorded.

As a result of Adient's fiscal 20242025 analysis of the realizability of its worldwide deferred tax assets, and after considering tax planning initiatives and other positive and negative evidence, Adient determined it was more likely than not that certain deferred tax assets would be realizableestablished and recorded an income tax benefit of $14 million in China, $8 million in Mexico, $7 million in France, and $6 million in Japan to release valuation allowances. In addition, Adient determined it was necessary to establishreleased valuation allowances on certain deferred tax assets at various subsidiaries, which did not have a material impact on Adient’s financial statements either individually or in Polandthe and Mexico, recording tax expense of $14 million and $5 million, respectively.aggregate. Adient continues to record valuation allowances on certain deferred tax assets in Germany, Hungary, Luxembourg, Mexico, Poland, Spain, the United Kingdom, the U.S. and other jurisdictions as it remains more likely than not that they will not be realized.

Adient is subject to income taxes in Ireland, the U.S. and other non-U.S. jurisdictions. Judgment is required in determining its worldwide provision for income taxes and recording the related assets and liabilities. In the ordinary course of Adient's business, there are many transactions and calculations where the ultimate tax determination is uncertain. Adient's income tax returns for various fiscal years remain under audit by the respective tax authorities. Although the outcome of tax audits is always uncertain, management believes that it has appropriate support for the positions taken on its tax returns and that its annual tax provisions included amounts sufficient to pay assessments, if any, which may be proposed by the taxing authorities. Nonetheless, the amounts ultimately paid, if any, upon resolution of the issues raised by the taxing authorities may differ materially from the amounts accrued for each year. Subsequent to September 30, 2025, Adient initiated a foreign tax audit settlement proposal which, although still under negotiation with the foreign tax authorities, is expected to require a non-recurring recognition and payment of approximately $20 million in fiscal 2026.

Comprehensive incomeloss attributable to Adient was $208$256 million induring fiscal 20232025 compared to $338$167 million of comprehensive lossincome induring fiscal 2022.2024. The increasedecrease of $546$423 million is due primarily to highera net loss during fiscal 2025 primarily resulting from the non-cash goodwill impairment recorded in the EMEA segment compared to net income in fiscal 2024 ($335$292 million), the favorableunfavorable impact of foreign currency translation adjustments ($233 million) and the impact of realized and unrealized gains on derivatives ($21$218 million), partially offset by higherlower comprehensive income attributable to noncontrolling interests ($42$18 million) and higher realized and unrealized gains on derivatives in fiscal 2025 compared to losses in fiscal 2024 ($69 million).

Adient evaluates the performance of its reportable segments using an adjusted EBITDA metric defined as income (loss) before income taxes and noncontrolling interests, excluding net financing charges, restructuring and impairment costs, restructuringrestructuring-related related-costs,costs, net mark-to-market adjustments on pension and postretirement plans, transaction gains/losses, purchase accounting amortization, depreciation, stock-based compensation and other non-recurring items. Also, certain corporate-related costs are not allocated to the segments. The reportable segments are consistent with how management views the markets served by Adient and reflect the financial information that is reviewed by its chief operating decision maker. Refer to the “Factors Affecting Adient’s Operating Environment” included above in Item 7 within the Management’s Discussion and Analysis section for more information on the factors that have impacted Adient’s fiscal 2025 financial results and that are expected to continue to impact Adient’s financial results in fiscal 2026.

Adient plc | Form 10-Q | 4950 commodities and raw materials. Although Adient has no operations in the Middle East or Ukraine and its operation in Russia has since been disposed, certain of its suppliers as well as customers depend on commodities and other material supplies that originate in the Middle East, Ukraine or Russia. The conflicts have led to increases in the cost of commodities and energy and have the potential for shortages, especially in Europe and Asia. In response to Russia’s invasion in Ukraine, a number of countries, including the United States, the United Kingdom and members of the European Union, have implemented economic sanctions on Russia and certain Russian enterprises including several large banks. If these conflicts continue or expand, it may trigger a series of additional economic or energy market impacts or further sanctions which in turn could further disrupt the global automotive supply chains by limiting supplies of key components or commodities and increasing inflationary pressures. These ongoing conflicts, along with other geopolitical uncertainties, could have broader adverse impacts on macroeconomic factors that impact Adient's business, cash flows, financial condition and results of operations.

This section and other parts of this Quarterly Report on Form 10-Q contain forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, that involve risks and uncertainties. Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Forward-looking statements can also be identified by words such as "future," "anticipates," "believes," "estimates," "expects," "intends," "plans," "predicts," "will," "would," "could," "can," "may," "forecast," "project," "should," or similar terms. Forward-looking statements are not guarantees of future performance and Adient's actual results may differ significantly from the results discussed in the forward-looking statements. Adient cautions that these statements are subject to numerous important risks, uncertainties, assumptions and other factors, some of which are beyond Adient’s control, that could cause Adient’s actual results to differ materially from those expressed or implied by such forward-looking statements, including, among others, risks related to: the effects of local and national economic, credit and capital market conditions (including the persistence of high interest rates, vehicle affordability and volatile currency exchange rates) on the global economy, increased competitive pressures in the EMEA and Asia regions from Chinese OEMs, uncertainties in U.S. administrative policy regarding trade agreements, tariffs and other international trade relations, automotive vehicle production levels, mix and schedules, as well as the concentration of exposure to certain automotive manufacturers particularly new entrants in the China market, shifts in market shares among vehicles, vehicle segments or away from vehicles on which Adient has significant content, changes in consumer demand, risks associated with Adient’s joint ventures, volatile energy markets, Adient’s ability and timing of customer recoveries for increased input costs, the availability of raw materials and component products (including components required by Adient’s customers for the manufacture of vehicles), risks associated with warranty and product recall and product liability exposures, geopolitical uncertainties such as the Middle East and Ukraine conflicts and the impact on the regional and global economies and additional pressure on commodities, supply chain and vehicle production, the ability of Adient to effectively launch new business at forecast and profitable levels, the ability of Adient to successfully identify suitable opportunities for organic investment and/or acquisitions and to integrate such investments and/or acquisitions, work stoppages, including due to strikes, supply chain disruptions and similar events, wage inflationary pressures due to labor shortages and new labor negotiations, the ability of Adient to execute its restructuring plans and achieve the desired benefit, the ability of Adient to meet debt service requirements and terms of future financing, the impact of global tax reform legislation, the impact of more aggressive positions taken by tax authorities, potential adjustment of the value of deferred tax assets, global climate change and related emphasis on sustainability matters by various stakeholders, and the ability of Adient to achieve its sustainability-related goals, cancellation of, or changes to, commercial arrangements, and the ability of Adient to identify, recruit and retain key leadership. Additional information regarding these and other risks related to Adient’s business that could cause actual results to differ materially from what is contained in the forward-looking statements is included in the section entitled "Risk Factors," contained in this Quarterly Report on Form 10-Q for the fiscal quarter ended MarchJune 31,30, 2026 and the Annual Report on Form 10-K for the fiscal year ended September 30, 2025. The following discussion should be read in conjunction with the consolidated financial statements and notes thereto included within this report as well as within Part II, Item 8 of our Annual Report on Form 10-K for the fiscal year ended September 30, 2025. All information presented herein is based on Adient's fiscal calendar. Unless otherwise stated, references to particular years, quarters, months or periods refer to Adient's fiscal years ended in September and the associated quarters, months and periods of those fiscal years. The forward-looking statements included in this Form 10-Q are made only as of the date of this report, unless otherwise specified, and Adient assumes no obligation to revise or update any forward-looking statements for any reason, except as required by law.

Adient designs, manufactures and markets a full range of seating systems and components for passenger cars, commercial vehicles and light trucks, including vans, pick-up trucks and sport/crossover utility vehicles. Adient operates approximately 200 wholly- and majority-owned manufacturing, assembly or sequencing facilities, with operations in 29 countries. Additionally, Adient has partially-owned affiliates in China, Asia, EuropeAsia and North America.Europe. Through its global footprint and vertical integration, Adient leverages its capabilities to drive growth in the automotive seating industry.

The results presented below are not necessarily indicative of full-year results as Adient, along with the automotive industry, continues to face a dynamic environment surrounding future production volume. This dynamic environment is the result of a combination of factors experienced over the recent past including the impact of higher energy, freight and other costs resulting from the conflicts in the Middle East and other parts of the world, softening consumer demand due in part to vehicle affordability, the direct and indirect impacts resulting from the imposition of U.S. and foreign tariffs, market share loss for foreign/luxury OEMs in the Asia reporting unit combined with modest expected margin declines as Adient continues to win new business with local OEMs in China, intensifying competition from Chinese imports and lower exports to China from EMEA as domestic brands expand in China, overcapacity in the EMEA reporting unit resulting in pricing pressure, continued disruptions caused by slower EV adoption rates, and interruptions from other suppliers due to production downtime and shortages of critical components or raw materials. Adient has also been experiencing increased levels of discussions with taxing authorities and more aggressive negotiations by the tax authorities as part of tax audits and related inquiries, resulting in higher levels of uncertainty on tax assessment outcomes. These factors may continue to negatively impact Adient’s results in the foreseeable future. Adient ishas also been monitoring developments associated with the Supreme Court decision related to tariffs issued under IEEPA. During the Internationalthird Emergencyquarter Economicof Powersfiscal Act2026, ("IEEPA"). No amounts have beenAdient recorded asreceivables of Marchapproximately 31,$52 2026million forrelated recoveriesto refunds that it believes are probable of collection from the U.S. government duestemming from the Supreme Court decision to variousnullify legal,tariffs regulatoryissued under IEEPA. The receivable is recorded in the Americas within other current assets and administrativethe uncertaintiescorresponding thatbenefit remainhas unresolved.been Thereflected impactas a reduction on cost of potentialsales. recoveriesA large portion of the refunds is not expected to be materialpassed on to Adient's resultscustomers ofto operationsthe extent Adient had previously collected such tariff reimbursements under separate agreements with its customers. Amounts expected to be repaid to customers have been reflected as reductions in net sales and operatingaccounts cashreceivable. flows.The net benefit associated with these IEEPA refunds is immaterial. Refer to the consolidated results of operations and segment analysis discussion below for additional information on the impacts of these items on Adient's results.

Adient conducts its business globally in the automotive industry, which is highly competitive and sensitive to economic, political and social factors in the various regions. During the three and sixnine months ended MarchJune 31,30, 2026, global light vehicle production decreasedincreased 0.9%1.3% and increased 0.7%,0.9%, respectively, primarily driven by reduced production volumes in North America and China, partially offset by higher production volumes in Asia.Asia, outside of China.

Significant aspects of Adient's financial results for the secondthird quarter of fiscal 2026 include the following:

•Adient recorded net sales of $3,865$3,929 million for the secondthird quarter of fiscal 2026, representing an increase of $254$188 million, or 7%,5%, when compared to the secondthird quarter of fiscal 2025. The increase in net sales is primarily attributable to higher overall production volumes largely in Americas and Asia and the favorable impact of foreign currencies, higher overall production volumes in Americas and Asia, net of lower overall production volumes in EMEA, and a net favorable impact of commercial pricing adjustments including customer cost recoveries.currencies.

•Gross profit was $257$235 million, or 6.6%6.0% of net sales, for the secondthird quarter of fiscal 2026 compared to $261$237 million, or 7.2%6.3% of net sales for the secondthird quarter of fiscal 2025. ProfitabilityGross profit was lowerimpacted dueby primarilythe tounfavorable lowerimpact productionof volume/mixforeign currencies and unfavorable operating performance,volume/mix, partially offset by thefavorable net operating performance including favorable material costs and the impact of foreignrecognizing currencies.IEEPA tariff refunds.

•Equity income was $13$20 million for the secondthird quarter of fiscal 2026, compared to $18$17 million for the secondthird quarter of fiscal 2025. The decreaseincrease iswas due primarily attributable to unfavorableprior productionyear volumesrestructuring andcharges recorded by certain of Adient's non-consolidated affiliates, partially offset by unfavorable operating performance at certain partially-owned affiliates.affiliates in Asia.

•Net income attributable to Adient was $27$25 million for the secondthird quarter of fiscal 2026, compared to net lossincome attributable to Adient of $335$36 million for the secondthird quarter of fiscal 2025. The higherlower net income in the secondthird quarter of fiscal 2026 is primarily attributable to ahigher $333income milliontax non-cashexpense, goodwillhigher impairmentSG&A chargeexpenses, relatingunfavorable toproduction volume/mix and the EMEA reporting unit in the prior year, the favorableunfavorable impact of foreign currencies, lowerpartially incomeoffset taxby expense,favorable lowernet SG&Aoperating expensesperformance including favorable material costs and the impact of recognizing IEEPA tariff refunds and a decrease in income attributable to noncontrolling interests, partially offset by unfavorable production volume/mixinterest and loweran increase in equity income.

Net sales increased by $403$188 million, or 6%,5%, duringin the firstthird six monthsquarter of fiscal 2026 as compared to the firstthird six monthsquarter of fiscal 2025 due to the favorable impact of foreign currencies ($255 million), higher production volumes in Americas and Asia, netpartially ofoffset by lower production volumes in EMEA as a result of softening customer demand and strategic portfolio actions ($126$147 million) and the favorable impact of foreign currencies ($41 million). The net favorable impact of commercial pricing adjustments includingduring customerthe andthird quarter of fiscal 2026 was completely offset by the reduction in net sales resulting from amounts expected to be passed on to Adient's customers related to IEEPA tariff cost recoveries ($22 million).refunds.

Cost of sales increased by $258$190 million, or 8%,5%, and gross profit decreased by $4$2 million, or 2%,1%, in the secondthird quarter of fiscal 2026 as compared to the secondthird quarter of fiscal 2025. The year over yearyear-over-year increase in cost of sales was primarily due to the unfavorable impact of foreign currencies ($143 million), the impact of higher production volumes in Americas and Asia, netpartially ofoffset by lower production volumes in EMEA as a result of softening customer demand and strategic portfolio actions ($103$149 million) and the unfavorable net operating performance including increased program launch costs and the impact of tariffsforeign currencies ($44 million), partially offset by favorable net operating performance mainly driven by the impact of recognizing IEEPA tariff refunds, net of higher freight and launch costs, as well as unfavorable material costcosts adjustmentslargely driven by the impact of the Middle East conflict ($12$3 million). Gross profit for the three months ended MarchJune 31,30, 2026 was impacted by the unfavorable impact of foreign currencies and unfavorable volume/mixmix, andpartially unfavorableoffset by favorable net operating performance mainlyincluding duefavorable tomaterial increasedcosts program launch costs, partially offset byand the favorable impact of foreignrecognizing currencies.IEEPA tariff refunds.

Cost of sales increased by $406$596 million, or 6%, and gross profit decreased by $3$5 million, or 1%, during the first sixnine months of fiscal 2026 as compared to the first sixnine months of fiscal 2025. The year over yearyear-over-year increase in cost of sales was primarily due to the unfavorable impact of foreign currencies ($228 million), the impact of higher production volumes in Americas and Asia, partially offset by lower production volumes in EMEA as a result of softening customer demand and($304 strategicmillion), portfoliothe actionsunfavorable impact of foreign currencies ($155$272 million) and unfavorable net operating performance including increased program launch costs, inefficiencies related to certain customer disruptionsdisruptions, andnet of the impact of tariffsrecognizing partiallyIEEPA offsettariff byrefunds and favorable material costcosts adjustmentsdespite the impact of the Middle East conflict ($23$20 million). Gross profit for the sixnine months ended MarchJune 31,30, 2026 was impacted by unfavorable volume/mix and unfavorable net operating performance including increased program launch costs and the impact of tariffs,mix, partially offset by the favorable impact of foreign currencies and favorable net operating performance including favorable material costcosts adjustments.and the impact of recognizing IEEPA tariff refunds.

SG&A decreasedincreased by $1$6 million during the first sixnine months of fiscal 2026 as compared to the first sixnine months of fiscal 2025 due to higher compensation expense including equity and performance-based incentive compensation costs ($19 million), the unfavorable impact of foreign currencies ($14 million) and lower amounts of gains on sales of facilities in the current year ($9 million), partially offset by lower net engineering and other administrative spending ($26$28 million), and third-party consulting costs associated with strategic planning in the previous year ($8 million), partially offset by higher compensation expense including equity and performance-.

Restructuring and impairment costs werewas lower by $346$5 million duringfor the secondthird quarter of fiscal 20262026, compared to $7 million the third quarter of fiscal 2025 and were lower by $345$347 million during the first sixnine months of fiscal 2026 due to a prior-year $333 million impairment charge relating to EMEA's goodwill during the three months ended March 31, 2025 and a prior-year $10 million impairment loss recorded on the Adient Aerospace investment during the first six months of fiscal 2025.investment. Refer to Note 13, "Restructuring and Impairment Costs" of the notes to the consolidated financial statements for information related to Adient's restructuring plans.

Equity income was $40$20 million duringfor the firstthird six monthsquarter of fiscal 2026, compared to $43$17 million duringin the firstthird six monthsquarter of fiscal 2025. The decreaseincrease is primarily attributable to ahigher one-time gain on the salelevels of Setexprior-year during the first quarter of fiscal 2025 ($4 million) and restructuring-relatedrestructuring charges related to certain of Adient's investment in non-consolidated affiliates ($2$6 million) and the favorable impact of foreign currencies ($1 million), partially offset by favorable operating performance at partially-owned affiliates ($2 million) and favorableunfavorable production volumes at partially-owned affiliates ($1$4 million).

Net financing charges infor the secondthird quarter of fiscal 2026 were lower by $3 million compared to the third quarter of fiscal 2025 as a result of lower average interest rates. Net financing charges for the first nine months of fiscal 2026 were comparable to the second quarter of fiscal 2025, and higher by $3 million during the first six months of fiscal 2026 as compared to the first sixnine months of fiscal 2025. The increase was primarily due to higher interest expense as a result of higher average interest rates. Refer to Note 8, "Debt and Financing Arrangements," of the notes to the consolidated financial statements for further information related to Adient's debt transactions and components of net financing charges.

Other pension expense was higher by $2 million infor the secondthird quarter of fiscal 2026 aswas comparedcomparable to the secondthird quarter of fiscal 2025,2025 and higher by $2 million during the first sixnine months of fiscal 2026 as compared to the first sixnine months of fiscal 2025 due to a curtailment loss of $2 million recorded in the Asia segment. Refer to Note 12, "Retirement Plans," of the notes to the consolidated financial statements for information related to the non-service components of Adient's net periodic pension costs.

The secondthird quarter fiscal 2026 income tax expense of $32$23 million was higher than the Irish statutory rate of 12.5% primarily due to the inability to record a tax benefit for losses in jurisdictions with valuation allowances, partially offset by tax benefits related to statutea expirations.transfer of intellectual property rights between subsidiaries in different tax jurisdictions. The secondthird quarter fiscal 2025 income tax expense of $48$7 million was higherlower than the Irish statutory rate of 12.5% primarily due to $16 million of tax benefits related to audit closures and $7 million of tax benefit related to foreign exchange remeasurements of tax balances primarily in Mexico, partially offset by the inability to record a tax benefit for losses in jurisdictions with valuation allowances, $19 million of tax expense related to adjustments to net operating loss deferred tax assets, $9 million of tax expense related to the establishment of an uncertain tax position, and the impact of the impairment of the non-tax-deductible portion of the EMEA goodwill balance for which there is no corresponding income tax benefit.allowances.

The first sixnine months of fiscal 2026 income tax expense of $74$97 million was higher than the Irish statutory rate of 12.5% primarily due to the inability to record a tax benefit for losses in jurisdictions with valuation allowances and the establishment of uncertain tax positions as a result of initiating a foreign tax audit settlement, partially offset by tax benefits related to audit closuresclosures, statute expirations, and statutea expirations.transfer of intellectual property rights between subsidiaries in different tax jurisdictions. The first sixnine months of fiscal 2025 income tax expense of $70$77 million was higher than the Irish statutory rate of 12.5% primarily due to the inability to record a tax benefit for losses in jurisdictions with valuation allowances, $19 million of tax expense related to adjustments to net operating loss deferred tax assets, $9 million of tax expense related to the establishment of an uncertain tax position, and the impact of the impairment of the non-tax-deductible portion of the EMEA goodwill balance for which there is no corresponding income tax benefit, partially offset by $7$23 million of tax benefits from theaudit releaseclosures of uncertain tax positions due toand statute expirations.

The decrease in income attributable to noncontrolling interests in the secondthird quarter of fiscal 2026 as compared to the secondthird quarter of fiscal 2025 is primarily attributable to lower production volumes and unfavorable operating performance at certain consolidated joint ventures in Asia.

The decrease in income attributable to noncontrolling interests during the first sixnine months of fiscal 2026 as compared to the first sixnine months of fiscal 2025 is primarily attributable to lower production volumes and unfavorable operating performance at certain consolidated joint ventures in Asia.

Net income attributable to Adient was $27$25 million for the secondthird quarter of fiscal 2026, compared to net lossincome attributable to Adient of $335$36 million for the secondthird quarter of fiscal 2025. The higherlower net income in the secondthird quarter of fiscal 2026 is primarily attributable to higher income tax expense, higher SG&A expenses, unfavorable production volume/mix and the unfavorable impact of foreign currencies, partially offset by favorable net operating performance including favorable material costs and the impact of recognizing IEEPA tariff refunds and a $333decrease millionin non-cashincome goodwill impairment charge relatingattributable to thenoncontrolling EMEAinterest reportingand unitan increase in theequity priorincome.

Net income attributable to Adient was $5$30 million during the first sixnine months of fiscal 2026, compared to net loss attributable to Adient of $335$299 million during the first sixnine months of fiscal 2025. The higher net income during the first sixnine months of fiscal 2026 is primarily attributable to a $333 million non-cash goodwill impairment charge relating to the EMEA reporting unit in the previous year, the favorable impact of foreign currencies andcurrencies, a decrease in income attributable to noncontrolling interests,interest and favorable net operating performance including favorable material costs and the impact of recognizing IEEPA tariff refunds, partially offset by unfavorable production volume/mix and lower equity income.mix.

Comprehensive Income (Loss) Attributable to Adient

Comprehensive lossincome attributable to Adient was $29$38 million for the secondthird quarter of fiscal 2026 compared to $229$176 million of comprehensive lossincome for the secondthird quarter of fiscal 2025. The lower comprehensive lossincome attributable to Adient is due primarily to a higher net income in the second quarter of fiscal 2026 compared to a net loss in the second quarter of fiscal 2025 ($357 million) and lower comprehensive income attributable to noncontrolling interests ($13 million), partially offset by the unfavorable impact of foreign currency translation adjustments ($131$126 million), realizeda andlower unrealizednet losses on derivativesincome in the secondthird quarter of fiscal 2026 compared to a gains in the secondthird quarter of fiscal 2025 ($39$17 million) and lower realized and unrealized gains on derivatives in the third quarter of fiscal 2026 compared to the third quarter of fiscal 2025 ($11 million), partially offset by lower comprehensive income attributable to noncontrolling interests ($16 million).

Comprehensive lossincome attributable to Adient was $37$1 million for the first sixnine months of fiscal 2026 compared to $454$278 million of comprehensive loss for the first sixnine months of fiscal 2025. The lowerhigher comprehensive lossincome attributable to Adient is due primarily to a higher net income in the first sixnine months of fiscal 2026 compared to a net loss in the first sixnine months of fiscal 2025 ($331$314 million) and lower comprehensive income attributable to noncontrolling interests ($8 million), partially offset by realized and unrealized losses on derivatives in the third quarter of fiscal 2026 compared to realized and realized gains on derivatives in the third quarter of fiscal 2025 ($119$36 million), partially offset byand the unfavorable impact of foreign currency translation adjustments ($25 million) and higher comprehensive income attributable to noncontrolling interests ($8$7 million).

The results presented below are not necessarily indicative of full-year results as Adient, along with the automotive industry, continues to face a dynamic environment surrounding future production volume. This dynamic environment is the result of a combination of factors experienced over the recent past including the impact of higher energy, freight and other costs resulting from the conflicts in the Middle East and other parts of the world, softening consumer demand due in part to vehicle affordability, the direct and indirect impacts resulting from the imposition of U.S. and foreign tariffs, market share loss for foreign/luxury OEMs in the Asia reporting unit combined with modest expected margin declines as Adient continues to win new business with local OEMs in China, intensifying competition from Chinese imports and lower exports to China from EMEA as domestic brands expand in China, overcapacity in the EMEA reporting unit resulting in pricing pressure along with continued disruptions caused by slower electric vehicle adoption rates, and interruptions from other suppliers due to production downtime and shortages of critical components or raw materials. Adient has also been experiencing increased levels of discussions with taxing authorities and more aggressive negotiations by the tax authorities as part of tax audits and related inquiries, resulting in higher levels of uncertainty on tax assessment outcomes. These factors may continue to negatively impact Adient’s results in the foreseeable future. Adient ishas also been monitoring developments associated with the Supreme Court decision related to tariffs issued under IEEPA. During the Internationalthird Emergencyquarter Economicof Powersfiscal Act2026, ("IEEPA").Adient Norecorded amountsreceivables of approximately $52 million related to refunds that it believes are probable of collection from the U.S. government stemming from the Supreme Court decision to nullify tariffs issued under IEEPA. The receivable is recorded in the Americas within other current assets and the corresponding benefit has been reflected as a reduction on cost of sales. A large portion of the refunds is expected to be passed on to Adient's customers to the extent Adient had previously collected such tariff reimbursements under separate agreements with its customers. Amounts expected to be repaid to customers have been recordedreflected as ofreductions Marchin 31,net 2026sales and accounts receivable. The net benefit associated with these IEEPA refunds is immaterial. Refer to the Factors Affecting Adient’s Operating Environment section in this Form 10-Q and within our Annual Report on Form 10-K for recoveries from the governmentfiscal dueyear toended variousSeptember legal,30, regulatory2025, andfor administrativeadditional uncertaintiesinformation on factors that have impacted Adient.

Adient plc | Form 10-Q | 42 (1) Corporate-related costs not allocated to the segments include executive office, communications, corporate development, legal and corporate finance.

(2) Reflects restructuring charges for costs that are probable and reasonably estimable and non-recurring asset impairments. The three and sixnine months ended MarchJune 31,30, 2026 reflects restructuring charges of $5 million and $29$34 million, respectively. The three months ended MarchJune 31,30, 2025 reflects restructuring charges of $18$7 million and a non-recurring, non-cash goodwill impairment charge of $333 million in the EMEA reporting unit.million. The sixnine months ended MarchJune 31,30, 2025 reflects restructuring charges of $31$38 million, a non-recurring, non-cash goodwill impairment charge of $333 million in the EMEA reporting unit and an impairment charge of $10 million related to Adient’s investment in Adient Aerospace. Refer to Note 13, "Restructuring and Impairment Costs" of the notes to the consolidated financial statements for additional information.

(4) Reflects restructuring-related charges for costs that are recorded as incurred or as earned and other non-recurring impacts that are directly attributable to restructuring activities. The three months ended MarchJune 31,30, 2026 includes $5$8 million of restructuring-related charges primarily recorded in cost of sales and $1 million of restructuring charges at partially-owned affiliates recorded within equity income.sales. The sixnine months ended MarchJune 31,30, 2026 includes $10$16 million of restructuring-related charges primarily recorded in cost of salessales, $2 million recorded in SG&A and $3 million of restructuring charges at partially-owned affiliates recorded within equity income. The three months ended MarchJune 31,30, 2025 includes $5$7 million in restructuring-related charges primarily recorded in cost of sales.sales and $6 million of restructuring charges at partially-owned affiliates recorded within equity income, partially offset by a $6 million gain on sale of a restructured facility recorded in SG&A. The sixnine months ended MarchJune 31,30, 2025 includes $11$18 million in restructuring-related charges primarily recorded in cost of sales,sales and $6 million of restructuring charges at partially-owned affiliates recorded within equity income, partially offset by a $5$11 million gain on salesales of a restructured facility in Americasfacilities recorded in SG&A.

(5) The sixnine months ended MarchJune 31,30, 2025 includes a $4 million gain on sale of its partially-owned investment in Setex recorded within equity income. Refer to Note 3, "Acquisitions and Divestitures," of the notes to the consolidated financial statements for additional information.

Adient plc | Form 10-Q | 43 (6) The three months ended MarchJune 31,30, 2026 includes a $5 million one-time, non-recurring reversal of contingent liabilities with a customer recorded in cost of sales, partially offset by $1$3 million of transaction costs recorded in SG&A. The sixnine months ended MarchJune 31,30, 2026 includes a $5 million one-time, non-recurring reversal of contingent liabilities with a customer recorded in cost of sales and a $2 million gain on a non-recurring contract related settlement recorded in SG&A, partially offset by $1$4 million of transaction costs recorded in SG&A. The three months ended MarchJune 31,30, 2025 includes $8$1 million of third-party consulting costs associated with strategic planning recorded in SG&A. The nine months ended June 30, 2025 includes $9 million of third-party consulting costs associated with strategic planning recorded in SG&A and a $1 million non-recurring loss at affiliates recorded inwithin equity income. The six months ended March 31, 2025 includes $8 million of third-party consulting costs associated with strategic planning and a $1 million non-recurring loss at affiliates,income, partially offset by a $2 million gain on a non-recurring contract related settlement recorded in SG&A.

Net sales increased during the secondthird quarter of fiscal 2026 by $185$168 million primarily due to higher production volumes ($131 million), net favorable commercial pricing adjustments including customer cost and tariff recoveries ($48$162 million) and the favorable impact of foreign currencies ($6$7 million), partially offset by the reduction in net sales resulting from amounts expected to be passed on to Adient's customers related to IEEPA tariff refunds, which is almost completely offset by net favorable commercial pricing adjustments ($1 million).

Net sales increased during the first sixnine months of fiscal 2026 by $216$384 million primarily due to higher production volumes ($130$292 million), net favorable commercial pricing adjustments includingdespite customerthe costreduction andin net sales resulting from amounts expected to be passed on to Adient's customers related to IEEPA tariff recoveriesrefunds ($77$76 million) and the favorable impact of foreign currencies ($9$16 million).

Adjusted EBITDA increased during the secondthird quarter of fiscal 2026 by $15$13 million due to favorable production volumes/mix ($21 million) and favorable net operating performance reflecting favorable customer pricing and the impact of recognizing IEEPA tariff refunds, net of unfavorable material costs largely driven by the impact of tariffs,the partiallyMiddle offsetEast byconflict unfavorable material cost adjustments,and higher overhead and program launch costs driven by inefficiencies related to certain customer disruptions ($9$2 million), thepartially favorableoffset impactby of foreign currencies ($4 million), lowerhigher SG&A and engineering expenses ($1$9 million) and favorablethe productionunfavorable volumes/miximpact of foreign currencies ($1 million).

Adjusted EBITDA increased during the first sixnine months of fiscal 2026 by $10$23 million due to lowerfavorable SG&Anet operating performance reflecting favorable customer pricing and engineeringthe expensesimpact of recognizing IEEPA tariff refunds, net of unfavorable material costs largely driven by the impact of the Middle East conflict and higher overhead and program launch costs driven by inefficiencies related to certain customer disruptions ($11$10 million), favorable production volumes/mix ($7 million), the favorable impact of foreign currencies ($6$5 million) and favorablelower net operating performance reflecting favorable customer pricing, partially offset by operating inefficiencies due to production disruption costs related to certain customers, unfavorable material cost, higher program launch costsSG&A and theengineering net impact of tariffsexpenses ($8$2 million), partially offset by unfavorable production volumes/mix ($14 million) and lower equity income ($1 million).

Net sales increaseddecreased during the secondthird quarter of fiscal 2026 by $41$57 million primarily as a result of the favorable impact of foreign currencies ($134 million), partially offset by lower production volumes as a result of softening customer demand and strategic portfolio actions ($83$82 million) and anthe unfavorable impact of net commercial pricing adjustments including($8 customermillion), costpartially recoveriesoffset by the favorable impact of foreign currencies ($10$33 million).

Net sales increased during the first sixnine months of fiscal 2026 by $117$60 million primarily as a result of the favorable impact of foreign currencies ($228$261 million), partially offset by lower production volumes as a result of softening customer demand and strategic portfolio actions ($97$179 million) and anthe unfavorable impact of net commercial pricing adjustments including customer cost recoveries ($14$22 million).

Adjusted EBITDA increased duringfor the first sixnine months of fiscal 2026 bywas $7comparable millionto the first nine months of fiscal 2025 due to favorableunfavorable production volume/mix ($24 million) and unfavorable net operating performance reflecting($3 favorablemillion), material cost adjustments and lower overhead and launch costs, partiallycompletely offset by unfavorablelower customerSG&A pricingand engineering expenses ($11$21 million), the favorable impact of foreign currencies ($4$5 million) and higher equity income ($1 million),. partially offset byThe unfavorable productionnet volume/mixoperating ($8performance million)includes unfavorable customer pricing and higher SG&Afreight andcosts, engineeringnet expensesof ($1favorable million).material costs despite the impact of the Middle East conflict.

Net sales increased during the secondthird quarter of fiscal 2026 by $27$89 million due to higher production volumes despite the unfavorable impact from the Middle East conflict ($33$79 million), the favorable impact of net commercial pricing adjustments ($9 million) and the favorable impact of foreign currencies ($19 million), partially offset by net unfavorable commercial pricing adjustments including customer cost recoveries ($25$1 million).

Net sales increased during the first sixnine months of fiscal 2026 by $74$163 million due to higher production volumes despite the unfavorable impact from the Middle East conflict ($92$171 million) and the favorable impact of foreign currencies ($22$23 million), partially offset by netthe unfavorable impact of net commercial pricing adjustments including customer cost recoveries ($40$31 million).