CVG Returns to Profit, Raises 2026 Revenue Range

CVG (CVGI) returned to positive quarterly earnings for the first time since the first quarter of 2024 as stronger demand across all three business segments lifted third-quarter revenue 36.5%. The company also raised its 2026 revenue range but narrowed its adjusted EBITDA outlook by lowering the upper end.

Revenue for the three months ended September 30 rose to $208.1 million from $152.5 million a year earlier. GAAP operating income was $7.7 million, or 3.7% of revenue, compared with an operating loss of $1.1 million and a negative 0.7% margin in the prior-year quarter.

GAAP net income reached $5.6 million, equal to $0.14 per diluted share, reversing a loss of $6.8 million, or $0.20 per share. Adjusted diluted earnings were $0.03 per share, up from an adjusted loss of $0.14. CVG attributed the return to positive earnings to operating leverage from higher volumes and lower interest expense.

Adjusted EBITDA increased to $8.5 million from $4.6 million, while the adjusted EBITDA margin widened to 4.1% from 3.0%. Adjusted operating income rose to $5.6 million from $1.6 million.

Margins improve across higher volumes

Adjusted gross margin expanded to 13.8%, up 170 basis points year over year and 90 basis points sequentially. The company cited productivity gains, supply-chain optimization and a more favorable product mix, along with surcharge recoveries, pricing and benefits from plant efficiencies and footprint changes.

The improvement was partly offset by higher selling, general and administrative expenses. Third-quarter SG&A increased to $23.5 million from $17.1 million, reflecting higher share-based and performance-based incentive compensation as well as advisory fees. SG&A represented 11.3% of revenue, compared with 11.2% a year earlier.

For the first nine months of 2026, revenue was $574.8 million, up from $494.2 million. GAAP operating income totaled $23.9 million, compared with $1.1 million in the same period of 2025.

All three segments post growth

Global Seating revenue increased 23% to $84.7 million, supported by stronger customer demand in North America and Asia-Pacific. Adjusted operating income rose to $4.6 million from $2.9 million. CVG said cost and operating-efficiency measures, aftermarket growth and a favorable product mix supported the result, while the segment continued to benefit from footprint consolidation in the U.S., U.K. and China.

Global Electrical Systems revenue climbed 30% to $64.4 million. The company attributed the increase to improved customer demand, the ramp-up of previously awarded programs in Europe, the Middle East and Africa and North America—including Zoox—and stronger demand in core markets such as construction. Adjusted operating income increased to $3.7 million from $1.4 million as higher volumes improved utilization and product mix.

Trim Systems and Components recorded the strongest sales increase, with revenue rising 72% to $58.9 million on higher North American demand and product-mix changes. Adjusted operating income reached $2.7 million, compared with a $0.3 million loss a year earlier, reflecting higher demand, operational efficiencies and improved mix.

Revenue outlook rises as EBITDA range narrows

CVG now expects 2026 revenue of $755 million to $775 million, compared with its previous range of $725 million to $755 million. The midpoint increased to $765 million from $740 million.

The company narrowed its adjusted EBITDA forecast to $26 million to $29 million from $26 million to $31 million, reducing the midpoint to $27.5 million from $28.5 million. Management continues to expect positive full-year free cash flow and plans to keep capital expenditures near the low end of its range of 2% to 3% of revenue.

The outlook assumes North American Class 8 truck production of 272,000 units in 2026, about 8% above 2025, with the ramp weighted toward the second half. CVG also expects the construction-equipment end market to grow at a high-single-digit rate. New-business ramps, including the Zoox scale-up, and construction demand are expected to support revenue.

Third-quarter free cash flow was $0.6 million, compared with negative $3.4 million a year earlier. Nine-month free cash flow was $10.9 million, down from $25 million; CVG’s measure includes proceeds from property, plant and equipment sales, which totaled $20 million year to date.

Net debt declined by $16.8 million from the end of 2025, while the net leverage ratio fell to 2.7 times from 4.1 times. Deleveraging actions included $20 million of sale-leaseback proceeds, proceeds from an at-the-market share issuance and more than $30 million of term-loan repayments. The company is targeting a long-term net leverage ratio of about 2 times.

Separately, David Ruppel is scheduled to become president and chief executive officer and join CVG’s board effective November 9, 2026. The company said Ruppel has more than 25 years of operating and general-management experience across several of CVG’s key end markets.

CVG’s outlook remains subject to changes in commercial-vehicle and electric-vehicle markets, Class 8 and medium-duty truck production, construction and agricultural equipment demand, supply-chain conditions, inflation, labor availability, tariffs and competition. The forecast also depends on the timing of new-program production and the company’s ability to generate cash while funding working capital for growth.