Dana Incorporated (DAN) Q3 2026 Earnings Report

The call was broadly positive. Strong third-quarter sales, adjusted EBITDA, margin expansion, cost-savings execution, commercial vehicle demand, increased sales guidance, and progress toward the Eaton transaction and its synergy targets significantly outweighed the disclosed challenges. The main negatives were lower quarterly free cash flow, tax and redemption charges, inflation and recovery pressure, some light-vehicle and regional aftermarket softness, higher labor and capital spending, and uncertainty around post-closing buybacks.

For 2026, Dan expects sales of approximately $7.8 billion at the midpoint of the range, plus or minus $50 million; adjusted EBITDA of approximately $825 million, with a range to plus or minus $25 million and an adjusted EBITDA margin of approximately 10.6%; diluted adjusted earnings per share of approximately $2 plus or minus 25¢; and adjusted free cash flow of approximately $325 million at the midpoint, plus or minus $50 million. The 2026 sales bridge includes approximately $300 million of year over year growth, with $75 million from volume and mix, approximately $15 million from performance, approximately $65 million from tariff recoveries, approximately 95 million from foreign currency translation, and $50 million from commodities; the adjusted EBITDA bridge includes approximately $60 million from volume and mix, approximately $95 million from performance, approximately $65 million from cost savings, currency as approximately a $5 million tailwind, and commodities as approximately $10 million headwind. Capital spending is expected to increase approximately $45 million to about $300 million, and the company expects adjusted EBITDA of approximately $825 million, representing a margin of approximately 10.6% and an improvement of roughly 250 basis points when compared with 2025. The cost savings program is on track to deliver 325 million here at the end of Q4, the Eaton transaction is targeted to close around the end of Q1 27 with $250 million of run rate synergies within 24 months post close, approximately $75 million of synergies in 2027, cost to obtain the synergies somewhere in the 200 million range over the 24 month period post closing, a target sales range of 14 to 15 billion, net leverage of 1.6x, and a combined-company target of 15% margins by 2030.