GT Q2 2026 - Post-Call Earnings Update

Event: Quartr Q2 2026 event Retrieved: 2026-08-11T11:50:00Z Comparison mode: maximal Scorecard contract: v1

Consensus scorecard

• Consensus scorecard, bulleted equivalent (carried forward unchanged from the preliminary report for this event):
  • Revenue / net sales: Quartr actual $4,250m against API Ninjas consensus $4,105.947m - Beat +$144.053m, +3.5%.
  • EPS / adjusted diluted: Quartr actual $(0.61) against API Ninjas consensus $(0.6297) - Beat +$0.0197, +3.1%.

Management and Q&A

• THE FULL-YEAR SEGMENT OPERATING INCOME WALK WAS GIVEN ON THE CALL, WHICH THE RELEASE OMITTED ENTIRELY. Interim CFO Scott Deakin, answering James Picariello, started from 2025 segment operating income of about $1 billion, said the divestitures take that to about $800 million, and then walked the puts and takes: raw materials essentially neutral on a full-year basis; price and mix contributing more than $200 million; Goodyear Forward benefits expected to offset inflation and other cost increases; and volumes plus the resulting fixed-cost absorption as the largest headwind overall. He said those together "ultimately we believe is going to reduce SOI for the full year to the tune of about $350 million," and separately put the full-year tariff impact at about $50 million, improving into the second half.
• THE FULL-YEAR SOI LEVEL WAS EFFECTIVELY CONFIRMED IN THE BALLPARK OF $600 MILLION OR SLIGHTLY ABOVE. Picariello restated "the similar SOI for the full year of around $600 million, I believe was where we all arrived at," and CEO Mark Stewart replied "maybe a touch higher than that, but I think that's certainly in the ballpark." Stewart also said the whole walk "lands us essentially in the same place as we communicated the outlook to you guys last time," including the volume outlook of a first-half headwind turning to flat-to-slightly-up in the second half.
• THE VOLUME DECLINE WAS DECOMPOSED, WHICH THE RELEASE DID NOT DO. Stewart said first-quarter unit volume was down about 12%, split roughly into thirds: SKU rationalization out of low-margin products, channel de-stocking, and competitiveness plus poor weather. In the second quarter the decline narrowed to 4%, and two-thirds of that was the low-end SKU rationalization. This directly answers the preliminary's open question about how much of the replacement volume decline was deliberate: on management's own account, most of the remaining decline is self-inflicted by design.
• The second-half case was framed as not requiring a market recovery. Stewart said "our outlook for the H2 is not dependent on a sharp change in the market," citing Americas consumer replacement as the biggest improvement, Asia Pacific strength in both OE and replacement, EMEA traction placing Cooper into the tier-2 slot vacated by Dunlop, channel de-stocking "largely behind us," and the lapping of the first-half SKU rationalization producing an easier second-half comparison. Global OE growth was put at three, four and five percentage points year over year by region, concentrated in 18-inch-and-above rim sizes.
• CASH BURN WAS QUANTIFIED FOR THE FIRST TIME. Asked by James Mulholland whether 2026 would be a burn year, Deakin said yes, "in the tune of about $200-$300 million," with Fayetteville a notable item at about $100 million for the year. He said continued burn is expected into 2027 but that it will "definitely start to moderate," with Fayetteville benefits of nearly $250 million in 2028 beginning to flow through.
• FAYETTEVILLE WAS SIZED IN CAPACITY TERMS. Stewart said the plant at peak represented between seven and eight million units of capacity, and put the benefit at about $270 million per year to segment operating income "really a year and a half, two years out," in the Americas and globally. He framed the closure as matching supply with demand against the unabsorbed fixed cost of the last several years.
• THE SAVINGS FIGURES ARE STATED TO BE NET OF TRANSITION COSTS. Asked directly by John Healy whether the $100 million and $270 million figures include the cost of reallocating and retooling the capacity that moves, Stewart said yes: "It includes any mold CapEx. It includes movement or recertification of product, and getting the ramp-up curves." Deakin added that both the P&L and balance sheet dynamics associated with that are included.
• GOODYEAR FORWARD WILL PASS $1.5 BILLION OF SAVINGS "in the coming couple of months," per Stewart, who described the program's discipline as now embedded rather than a discrete initiative. He also said every function, region and product business unit runs a regular governance cadence against cost and inflation offsets.
• RAW MATERIALS INTO 2027 WERE ADDRESSED BUT NOT RE-GUIDED. Deakin said the company had guided a second-half raw material headwind of about $200 million on the first-quarter call and has not seen enough to change that, citing lag effects, supply chain dynamics and refinery economics. Looking to 2027 he said stabilization in the Middle East flowing through to oil would be a benefit, and that raw material indexes on roughly a third of the business would be expected to reset higher into 2027, which he also characterized as a benefit.
• COMMERCIAL SHOWED THE FIRST POSITIVE INFLECTION IN TWO YEARS. Stewart said second-quarter commercial OE shipments were up for the first time in two years. Commercial OE was running about 200% above the prior year at the last call and about 100% above in June, on what he repeatedly stressed is a very low comparable, with Class 8 truck industry volume near the lowest in the history of that market. He cited tightening truck capacity, rising freight rates and a PMI above 50 all year, while noting freight volumes are still down year over year and that the industry needs more than a year to return to mid-cycle OE production.
• ON THE RETAIL BUSINESS, NO MONETIZATION WAS SIGNALLED. Asked by John Healy whether Goodyear needs to own retail, Stewart said company-owned US retail "is performing better than it has in over two decades," defended the direct consumer-facing position on strategic grounds, and pointed to a new enthusiast concept store launching in Detroit. He did not address a sale or separation of the asset. Mulholland's earlier question about monetizing retail as a next portfolio move was answered with Fayetteville and manufacturing modernization rather than with any portfolio action.
• PORTFOLIO STRATEGY WAS QUANTIFIED. Stewart said the company brought about 40% more new SKUs and power lines to market last year than it ever had, that those are flowing into the market now, and that another large wave comes this year and next. He also qualified the "18-inch and above" premium framing, saying the threshold differs by geography and is closer to 16-inch and above in South America, and reframed the target as premium market share rather than a single rim-size cut.
• FURTHER STRUCTURAL ACTIONS ARE UNDER EVALUATION BUT UNNAMED. Asked what comes after Fayetteville - more plant closures, asset sales, or monetizing retail - Stewart recounted completed and in-flight actions rather than naming new ones: the second Debica-area European closure now completing across Fulda and Furstenwalde with premium capacity moving to Eastern Europe, and modernization at Lawton, the Napanee expansion, plant digitalization and the Americana expansion in South America. Deakin said other structural items "are being evaluated" without identifying any.
• The call was short. Five analyst lines were taken - James Picariello, James Mulholland (Deutsche Bank), an analyst standing in for Rajat Gupta (JPMorgan), John Healy (Northcoast Research) and Itay Michaeli (TD Cowen) - before the operator closed the queue for time.

Guidance and KPI clarification

• Guidance and KPIs, bulleted equivalent: the call supplied a full-year segment operating income framework that the release did not contain. The walk starts at about $1.0bn of 2025 SOI, moves to about $800m for divestitures, then carries raw materials essentially neutral for the full year, price and mix above +$200m, Goodyear Forward benefits offsetting inflation and other cost increases, and volume with fixed-cost absorption as the largest headwind, for a stated full-year reduction of about $350m and a full-year tariff impact of about $50m. Management accepted around $600m, "maybe a touch higher," as the resulting full-year SOI level. Free cash flow is guided to a burn of about $200m to $300m in 2026, including about $100m of Fayetteville cash cost, with continued but moderating burn in 2027. Third-quarter volume is guided roughly flat year over year with the fourth quarter possibly slightly better. Fayetteville removes seven to eight million units of peak capacity and is worth about $270m per year to SOI one and a half to two years out, described elsewhere on the call as nearly $250m in 2028. Goodyear Forward will pass $1.5bn of cumulative savings within a couple of months. The second-half raw material headwind of about $200m guided on the first-quarter call was explicitly left unchanged.
• Volume decomposition stated on the call: Q1 units −12%, split roughly in thirds between SKU rationalization, channel de-stocking, and competitiveness plus weather; Q2 units −4%, two-thirds of which was SKU rationalization.
• Channel data points stated on the call: global OE growth of three to five percentage points year over year by region; commercial OE shipments up in Q2 for the first time in two years; commercial OE about 100% above the prior year in June against about 200% at the last call, on historically low industry volumes; PMI above 50 for the entire year; freight volumes still down year over year.

Updated neutral analysis

• What the call resolved from the preliminary: the absence of any forward guidance in the release, which is now replaced by a full-year SOI walk and a stated full-year cash burn; how much of the replacement volume decline is deliberate, which management puts at two-thirds of the second-quarter decline; the Fayetteville capacity removed and the annual benefit; whether the stated Fayetteville savings are gross or net of transition costs, which management says are net; the cumulative Goodyear Forward figure, which passes $1.5bn shortly; and the 2026 cash cost of Fayetteville at about $100m.
• What the call did not resolve: the $46m tax expense on a pre-tax loss, which was never raised; the $1,059m of long-term debt due within one year and any refinancing plan, which was never raised; the phasing of the $535m to $565m Fayetteville charge across 2026 and 2027 beyond the $100m of 2026 cash; the split between tariffs and other costs inside the quarter's $100m bridge item; the segment-level divestiture impact on operating income; the unitemized "other" deductions that rose to $47m from $29m; and the timeline for a permanent CFO, which no analyst asked about even though Scott Deakin was welcomed on the call in an interim capacity.
• THE SOI WALK AS SPOKEN DOES NOT FOOT CLEANLY, AND THIS IS FLAGGED RATHER THAN RESOLVED. Deakin's walk moves from about $1.0bn to about $800m for divestitures and then states a reduction "for the full year to the tune of about $350 million." Applying that $350m to the $800m divestiture-adjusted base gives roughly $450m, which is well below the roughly $600m-and-a-touch-higher level management then endorsed; applying it to the unadjusted $1.0bn gives roughly $650m, which is consistent with that endorsement. This arithmetic is a local observation on the spoken figures, not a company statement, and management was not asked to reconcile the two.
• A SECOND TENSION SITS IN THE RAW MATERIAL COMMENTARY. Deakin described raw materials as "essentially neutral on a full year basis" inside the SOI walk, and minutes later confirmed that the roughly $200m second-half raw material headwind guided on the first-quarter call stands unchanged. The two are reconcilable only if the first half carried an equal and opposite tailwind, which was neither stated nor asked about.
• The volume story is now clearer but not obviously better. Management's decomposition means the reported unit decline is mostly self-inflicted, which supports the mix and margin case, but it also means the volume headwind and its fixed-cost absorption drag - which Deakin named as the largest single negative in the full-year walk - is a consequence of strategy rather than a cyclical item that reverses on its own. The Fayetteville closure is the explicit response to that.
• Management's second-half case rests on comparison effects rather than demand. Every driver cited - de-stocking finished, SKU rationalization lapping, easier comparables, OE wins from prior-year design-ins - is a base effect or a prior decision working through. Stewart said explicitly that the outlook does not depend on a sharp change in the market, which is a lower-risk framing than a demand recovery but also leaves little upside if the market does improve within the year.
• The commercial inflection is real but small and off a historically depressed base, on management's own repeated caveat, and freight volumes are still declining. Management's own framing is that mid-cycle OE production is more than a year away.
• Nothing on the call changed the consensus scorecard. Both rows are carried forward from the preliminary report unchanged. The call added no restatement of any second-quarter reported figure.
• The portfolio question was asked twice, by two different analysts, and produced no new action. Retail was defended on strategic grounds without addressing monetization, and "further structural items are being evaluated" was the whole of the forward answer.

Market context and limitations

• SCOPE OF TRANSCRIPT READ: the transcript for Quartr event 662306 is complete and not live. Only the Q&A section was read, in full, across all 61 paragraphs, covering questions from James Picariello, James Mulholland (Deutsche Bank), an analyst standing in for Rajat Gupta (JPMorgan), John Healy (Northcoast Research) and Itay Michaeli (TD Cowen), plus the CEO's closing remarks. THE PREPARED REMARKS SECTION WAS NOT READ. Any figure or announcement made only in the prepared remarks and not repeated in the Q&A is therefore absent from this update. Deakin referred once to "my opening remarks at the beginning," which were not read here.
• Speaker attribution is taken from the Quartr transcript's own speaker fields, which identify Mark Stewart as CEO and President and Scott Deakin as Interim CFO. One analyst paragraph carries no speaker name; the operator's introduction identifies the line as Rajat Gupta of JPMorgan and the speaker self-identifies as standing in for him.
• API Ninjas price snapshot for GT: $6.03 on NASDAQ with volume of 13,284,748, timestamped 2026-08-11T11:18:45Z. That is roughly 07:18 Eastern on 2026-08-11, five days after the call, and before the regular session opens, so it is a pre-market snapshot on an unrelated day and carries no information about the market's reaction to this call. No reaction to the call is characterized here.
• Every figure in the consensus scorecard is carried forward from the preliminary report for this event and was not recalculated.
• Percentages, dollar amounts and unit figures attributed to management in this report are as spoken on the call and were not recomputed from the release, except where a calculation is explicitly labelled as a local observation.
• The call ended on the operator's time limit rather than an exhausted question queue, so the absence of questions on the tax expense, the near-term debt maturity and the permanent CFO search reflects the length of the call as much as analyst priorities.