Goodyear's fourth quarter saw a negative market reaction as results revealed ongoing margin pressures and flat sales despite exceeding revenue expectations. Management pointed to persistent challenges in the U.S. consumer replacement and commercial truck segments, citing weaker industry demand and high channel inventories. CEO Mark Stewart described the market as “very challenging,” noting that promotional activity and consumer reluctance to replace tires weighed on volumes. The company emphasized a disciplined approach to pricing and product mix, prioritizing higher-margin segments over volume growth.
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Goodyear (GT) Q4 CY2025 Highlights:
- Revenue: $4.92 billion vs analyst estimates of $4.86 billion (flat year on year, 1.3% beat)
- Adjusted EPS: $0.39 vs analyst expectations of $0.49 (19.8% miss)
- Adjusted EBITDA: $553 million vs analyst estimates of $534.2 million (11.2% margin, 3.5% beat)
- Operating Margin: 6%, in line with the same quarter last year
- Market Capitalization: $2.70 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Goodyear’s Q4 Earnings Call
- James Picariello (BNP Paribas) pressed for details on volume stabilization and the role of overhead absorption. CFO Christina Zamarro explained that Q2 sell-in should normalize as inventories clear, with volume recovery expected in the second half.
- Justin Barell (TD Cowen) asked about channel inventory trends and the outlook for free cash flow. Zamarro said most excess inventory should decline in Q1, with working capital improvements and supply chain financing supporting slightly positive free cash flow for the year.
- James Mulholland (Deutsche Bank) questioned commercial vehicle market recovery and margin leverage. Zamarro said U.S. commercial OE should improve in the second half off a low base, but assumptions remain cautious.
- Ross MacDonald (Citi) inquired about inventory composition and Goodyear’s share in larger rim sizes. Zamarro said inventory issues are broad-based, but the company’s portfolio is now 50% 18-inch or larger in U.S. consumer replacement.
- Ryan Brinkman (JPMorgan) sought clarification on Goodyear Forward savings and European tariff impacts. Zamarro confirmed most cost savings are from prior actions, while CEO Stewart outlined anticipated EU tariffs could range from 41% to 104%.
Catalysts in Upcoming Quarters
In coming quarters, the StockStory team will closely monitor (1) the pace at which U.S. channel inventories normalize and demand rebounds in replacement markets, (2) the execution and market uptake of Goodyear’s expanded premium product lineup, and (3) the impact of tariffs and raw material cost trends on margins—especially in the first half of the year. Strategic progress on cost efficiency and operational discipline will also be key signposts.
Goodyear currently trades at $9.52, down from $10.52 just before the earnings. Is there an opportunity in the stock?Find out in our full research report (it’s free).
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