ZF Friedrichshafen AG recorded €28.9 billion in sales during the first nine months of 2026, while its adjusted EBIT margin increased to 4.9%. Improved cash flow and lower leverage reflect progress in the company’s ongoing restructuring and cost-reduction initiatives.
Friedrichshafen, Germany: ZF Friedrichshafen AG reported improved earnings and a stronger financial position for the first nine months of 2026, with sales remaining broadly stable at €28.9 billion compared with the corresponding period last year. Organic sales grew by 1.4%, supported primarily by North America, despite continued weakness in global passenger-car markets.
The company’s adjusted EBIT increased to €1.4 billion from €1.0 billion in the previous year, while its adjusted EBIT margin improved to 4.9% from 3.6%. The margin reached the upper end of ZF’s full-year 2026 guidance range of 4.0% to 5.0%, reflecting the impact of its ongoing performance improvement programme.
Regionally, North America remained the primary growth contributor, while sales in Europe and Asia-Pacific were broadly flat. Geopolitical tensions continued to affect market confidence and demand across global vehicle markets.
ZF also reported a significant improvement in adjusted free cash flow, which increased to approximately €1.1 billion from €683 million in the first nine months of 2025. The improvement of €411 million was supported by stronger operating performance and disciplined investment management. However, cash outflows associated with restructuring provisions affected free cash flow during the third quarter.
The company’s debt position also improved during the reporting period. Net debt stood at €10.1 billion as of September 30, 2026, approximately €130 million lower than at the end of 2025. Its leverage ratio declined to 2.61x from 2.98x at the end of the previous year.
As part of its funding strategy, ZF placed a €750 million bond with a 4.5-year maturity and a 5.750% coupon in mid-September, despite volatile capital market conditions. The proceeds are intended to finance the early redemption of selected euro-denominated bonds due in 2027 and 2028. The company’s funding position has also received support from recent rating outlook upgrades by Moody’s and S&P Global Ratings.
Commenting on the results, ZF Chief Financial Officer Michael Frick said the company was making measurable progress, with improvements in earnings and free cash flow alongside a reduction in leverage. He highlighted that the recent bond placement enabled ZF to address upcoming debt maturities ahead of schedule and strengthen its funding position.
Frick added that challenging market conditions continue to require further action, with the company maintaining its focus on restructuring operations, reducing costs and debt, and accelerating execution. These measures, he noted, are essential to converting ZF’s technological capabilities into sustainable long-term financial performance.
ZF will present its full-year 2026 financial results at its annual press conference scheduled for March 18, 2027.
