Versigent Q1 2026 Earnings Call - Strong Start as Standalone with Copper Headwinds and Dividend Launch

Chris McNally, Analyst, Evercore ISI0: Day, welcome to the Versigent Q1 earnings call. Today’s conference is being recorded. At this time, I would like to turn the conference over to Annalisa Bluhm. Please go ahead.

Annalisa Bluhm, Investor Relations Officer, Versigent: Thank you, and good afternoon, everyone. I’m joined today by Joseph Liotine, our Chief Executive Officer, and Douglas R. Ostermann, our Chief Financial Officer. Today’s call includes forward-looking information reflecting our current view of future financial performance and may be materially different for reasons that we cite in our Form 10-Q, earnings materials, and other filings with the Securities and Exchange Commission, including the Risk Factors section of our registration statement on Forms 10-12B/A, filed on March 6, 2026. Our guidance reflects management’s current expectations and should not be relied upon as a guarantee of future performance. We undertake no obligation to update these statements except as required by law. We may also reference non-GAAP financial measures during the call. Reconciliations to the most directly comparable GAAP measures are included in today’s earnings release and are available on our investor relations website.

I will now turn the call over to Joe.

Joseph Liotine, Chief Executive Officer, Versigent: Thank you, Annalisa. Good afternoon, everyone. Today marks an important moment for Versigent. On April 1st, we entered the public market with clarity about who we are, how we compete, and how we create value. Versigent launched from a position of strength, generating close to $9 billion in annual revenue, not as a concept, but as a scaled, profitable, and disciplined business. I’m pleased to be here speaking with you today on our first earnings call as an independent company. Before we get into the numbers, I wanna take a moment to thank the hundreds of customers, thousands of suppliers, and our incredible employees, nearly 140,000 of them around the world, who made this historic moment possible. As we begin, I wanna take a moment to outline how we will spend our time this afternoon.

I’ll start by describing what Versigent does and the problem we solve, then walk through how our business model drives sustained growth and margin expansion, outline our strategic imperatives as a standalone company, and then provide a brief update on how the first quarter unfolded. Doug will then walk you through the financials in more detail. As a reminder, the financial information we will discuss today reflects results from a period when Versigent operated as part of Aptiv and is presented on a carve-out accounting basis. Versigent exists to solve a challenge that is intensifying across many sectors, including mobility, industrial, and energy systems. Today’s innovations are creating products with more autonomy, more connectivity, and more features, resulting in increased power demands, increased sensing capabilities, and much more sophisticated and complex products. Customers need to deliver these innovations while still finding ways to reduce complexity and create productivity opportunities.

That’s where Versigent comes in. Power and data distribution are critical to unlocking advanced functionality. It is the nervous system of modern products, and that shift plays directly to our strengths. At its core, Versigent designs, manufactures, and delivers low and high voltage power, signal, and data distribution architectures. Each architecture is unique. These advanced systems connect and power the critical components that enable modern vehicles and equipment to function safely and reliably. Increasing complexity means these architectures must be carefully designed early, optimized holistically, and executed consistently at scale. That is where Versigent operates. What differentiates Versigent is not just scale, but how we apply it. Our systems are embedded in design of leading OEM programs globally, and we work with every major auto manufacturer, including growing automotive leaders in China.

More than 75% of our revenue comes from solutions our engineers influence, often early in the program lifecycle when architecture decisions matter most. While Versigent is often categorized alongside other automotive suppliers, we operate as a highly engineered, design-driven company supported by an intelligent and proprietary design and engineering tool suite. These tools allow us to model, simulate, and optimize complex electrical architectures, helping customers reduce weight, cost, and risk while accelerating development and improving quality and the efficient manufacturability of these products. Importantly, they are deeply integrated into our engineering workflows and customer engagements, creating a sustained competitive advantage. Our unique engineering capabilities provide expertise that differentiate us from others. As architectures evolve, simplified systems remove pass-through content such as copper and increase the value of optimization with elegant systems and digital design capabilities.

That is where Versigent leads and why our new architectures are margin accretive over time. This shift toward greater capabilities plays directly into our operating model. We combine design influence, proprietary tools, disciplined manufacturing, and automation to drive structural margin improvement through execution. Versigent is fundamentally resilient. Our growth is content-driven, supported by long-term secular tailwinds, including electrification, connectivity, and software-enabled functionality. We are platform agnostic. Whether customers deploy ICE, hybrid, or battery electric architectures, the complexity of these programs continues to rise, and Versigent benefits. We also see attractive opportunities beyond automotive. Adjacent markets face many of the same pressures we already solve for. More content and features, greater reliability, and tighter tolerances. We are approaching these adjacencies selectively, extending proven capabilities into areas such as commercial vehicles, energy storage, and selected industrial applications without changing our operating model, our execution discipline, or our technical expertise.

As we begin this next chapter, Versigent enters the market with clear priorities. Strengthen our market leading position by leveraging our full service capabilities. Continue optimizing our cost structure through automation and footprint discipline. Deliver consistent financial results through execution. Allocate capital in a disciplined manner to drive long-term shareholder value. These priorities reflect how we operate as an independent company: focused, accountable, and execution-driven. With those priorities as our foundation, the first quarter provided clear evidence of how they are taking shape in the business. The progress we delivered across launches, customer wins, and quality reflects disciplined execution and reinforces our positioning with leading OEMs and global programs. During the first quarter, our teams executed across a broad set of programs globally with a high level of launch activity and complexity.

We successfully delivered multiple launches across regions and programs, including complex premium and high content vehicle programs requiring advanced electrical architectures in close coordination with OEM engineering teams, all with stable ramps, with more than 99% quality and more than 99% on-time performance. We also continue to build go-to-market momentum through new program wins and extensions with leading OEM customers. These awards span regions and programs and reflect continued demand for Versigent’s low and high voltage solutions as electrical content and system integration requirements increase. Quality and delivery remained a clear differentiator in the quarter. Customer recognition and quality awards reinforced Versigent’s reputation as a partner that executes consistently, particularly on complex global platforms where reliability and performance are critical. In addition, we made tangible progress in non-automotive markets, beginning production on an energy-related power program.

This program expands our served applications beyond traditional vehicle architectures while leveraging the same engineering, manufacturing, and systems capabilities that underpin our automotive leadership. Together, these execution outcomes supported the volume growth achieved in the quarter and demonstrate how our priorities are translating into results. From a financial standpoint, the quarter was a strong start to the year for Versigent. Revenue increased 9% year-over-year to $2.2 billion, with 3% adjusted growth, adjusting for foreign currency and commodity pass-through, reflecting solid underlying volume performance across the business. Doug will walk through the financial details in more depth, but at a high level, the results reflect strong execution and demand across the business.

In addition, we had a strong start to the year with $2.6 billion in new bookings this quarter and the start of 24 new programs, putting us on track for the most new major launches in our history, including the production on an energy storage program. Regionally, performance was strong in the Americas, where adjusted growth was 6% year-over-year, supported by higher volumes on key programs and new business wins. In Asia Pacific, adjusted revenue growth of 12% was driven by new platform launches, including a greenfield program in India and continued momentum with both global and regional OEMs. In EMEA, revenue was down 12% on an adjusted basis, consistent with a softer production environment. Though we continue to see progress through incremental program wins and successful launch of our premium vehicle mid-cycle refresh.

Overall, the regional results reinforce the strength of Versigent’s global footprint and customer relationships with volume growth driven by launches, program execution, and expanding content on key programs. Taken together, the quarter reflects a solid operational and financial performance as we move into the rest of the year and reinforces our confidence. As Versigent enters the next phase, we do so to unlock greater value. We are a highly engineered, globally scaled, and cash generative industrial company, supported by clear priorities, strong execution capabilities, and disciplined capital allocation. I’ll turn the call over to Doug Ostermann, our Chief Financial Officer, to walk through the financial details of the quarter and our outlook for 2026.

Douglas R. Ostermann, Chief Financial Officer, Versigent: Thanks, Joe. I’ll begin with a review of our first quarter financial results. As a reminder, results for the quarter are presented on a carve-out basis, reflecting Versigent’s operations as part of Aptiv through March 31st. The separation was completed on April 1st, and financial information for periods prior to that date have been prepared as if Versigent had operated as a standalone entity derived from Aptiv’s historical accounting records. With that context, I’ll walk through the quarter starting with revenue on the next slide. Overall, Versigent had a strong first quarter. First quarter revenue was $2.2 billion, representing 9% growth year-over-year on a reported basis, and 3% growth on an adjusted basis, excluding the impacts of foreign exchange and commodity pass-throughs. The quarter reflected solid underlying volume performance driven by sustained demand from core OEM customers.

Despite the lower global vehicle production environment, volumes increased across a number of key programs and demand remained strong. Growth in the quarter was supported by Versigent’s solid position on global platforms where electrical architectures are becoming more complex and increasingly integrated into vehicle performance and functionality. We continue to work closely with our OEM partners in the early stages of design, which supports both volume growth and durability of business over time. In the Americas, we achieved adjusted growth of 6%, driven primarily by higher volumes on truck and SUV platforms and strong execution across ongoing programs. Versigent continues to be well-positioned with leading North American OEMs, particularly on large truck and SUV platforms, where electrical architectures require high levels of reliability, scale, and integration. In Asia Pacific, adjusted growth was 12%, reflecting growth with both global OEMs and domestic customers.

Performance in the region was supported by launch activity, program extensions, and continued demand across China, India, and other growth markets. One area where we continue to see growth is with customers in China that are benefiting from the increased demand for vehicles exported to different countries. As architectures evolve and regional platforms become more differentiated, customers increasingly value Versigent’s distinct engineering depth and local manufacturing capabilities, which contributed to the quarter’s volume growth. In EMEA, revenue declined 12% on an adjusted basis, reflecting lower production levels in the region and the end of production of certain programs. Customer engagement across the region remains strong, and the program portfolio continues to support future growth as production normalizes. Across all regions, the quarter reinforced the importance of Versigent’s global footprint and its ability to consistently support OEMs across continents, platforms, and vehicle segments.

Adjusted EBITDA for the first quarter was $203 million. That’s an increase of 3% year-over-year, with an adjusted EBITDA margin of 9.2%. Adjusted EBITDA reflects contributions from higher volumes alongside ongoing operational execution, offset primarily by foreign currency exchange and commodity headwinds. As you can see on slide 10, the increase in sales specifically related to foreign currency exchange and commodity pass-through was $122 million. This increase alone drove a degradation of about 50 basis points of margin in the quarter on a year-over-year basis. We believe we are on track to meet our full year margin targets. EBITDA performance in the quarter was driven by operational execution and certain cost dynamics, such as material productivity from supplier negotiations, value-added engineering, and content reduction initiatives.

The quarter also reflected higher commodity costs and foreign currency exchange impacts, including the timing of customer pass-throughs. You can see on slide 11 an unfavorable impact of $46 million on a year-over-year basis. This primarily reflects 2 factors. First, an increase in the copper index of over 25%, driving about 2/3 of the impact. Second, a strengthening of the Mexican peso of about 15%, which is the primary driver of the remaining impact. For copper, we have escalation agreements that cover roughly 3/4 of our exposure. However, there is a lag on average of about 3-4 months between when our costs increase and when we update the pricing with our customers. This causes temporary margin dilution when indices increase rapidly as we saw in Q1.

Assume copper indices stay consistent with Q1 average rates, we expect the lag impact to cease as our prices will be adjusted to align with our costs. We factor both higher copper prices and stronger Mexican peso into our planning for the year. We will continue to manage these risks through customer agreements, financial hedges, and cost reduction initiatives. Looking ahead, margin performance is expected to continue to be driven by profitable growth, execution on manufacturing and materials initiatives with cost actions in place to manage external pressures. Turning to income taxes, the U.S. GAAP income tax benefit for the first quarter was $9 million, compared with an income tax expense of $29 million in the prior year quarter. The quarter-over-quarter change was driven almost entirely by a favorable tax reserve adjustment during the first quarter of 2026.

For full year 2026, we expect an adjusted effective tax rate of approximately 23% with a comparable cash tax rate. Operating cash flow in the first quarter was $36 million, and free cash flow was an outflow of $30 million. Cash flow in the quarter reflected several timing-related factors. Capital expenditures totaled $66 million. In addition, the quarter included restructuring cash outflows aligned with actions already underway, as well as $26 million of one-time separation costs. Working capital was also a use of cash during the quarter as we experienced our typical seasonal build required to ramp back up from customary customer shutdowns during the last couple of weeks of the calendar year.

As the year progresses, continued execution and working capital normalization will support significant free cash flow generation. From a financial position standpoint, Versigent ended the quarter with $282 million of cash on hand, $1.1 billion of overall liquidity. This is supported by an $850 million revolving credit facility that remains undrawn. Our cash balance at quarter end reflects the timing of certain separation-related cash settlements with our former parent company, much of which have been settled after the quarter end, bringing our cash balances directly in line with the $400 million pro forma level outlined in our Form 10. Turning to our outlook for the full year, we are reaffirming our financial guidance for 2026.

For the year, we expect revenue of $9.1 billion to $9.4 billion, which represents approximately 2% adjusted growth despite a production environment that is expected to be down about 1% year-over-year. From a profitability standpoint, we expect adjusted EBITDA of $950 million to $1.03 billion, with an adjusted EBITDA margin of approximately 10.7% at the midpoint. This outlook reflects profitable sales growth and continued progress on operational and performance initiatives. This includes manufacturing efficiency, material productivity, and automation, which are expected to drive continued margin expansion. From a cash flow perspective, we expect free cash flow of $200 million to $300 million for the year, which includes approximately $70 million of separation-related costs.

Our free cash flow outlook reflects the expected cadence of earnings growth, working capital normalization, and the reduction of separation cash outflows as the year progresses. Turning now to capital allocation, Versigent remains committed to a disciplined and balanced capital allocation framework, prioritizing continued growth while returning cash to shareholders. As part of our capital allocation framework, we intend to return a portion of future earnings to shareholders through a regular dividend. This policy reflects our confidence in the durability of our cash flow profile and our ability to support recurring returns to shareholders. The initial dividend is expected to be declared following the end of the second quarter in the range of $0.13 per share per quarter. Of course, any dividend is subject to the approval and declaration by our board.

In addition, our board approved a share repurchase program for up to $250 million. The program does not have an expiration date and may be amended, suspended, or terminated by the board. Under the program, we intend to repurchase shares opportunistically from time to time, subject to management’s discretion. Our intention will be to fund share repurchases with operational cash flows, which typically are weighted towards the latter half of the year. Together, the dividend policy and share repurchase program reinforce our commitment to returning capital to shareholders while enabling continued execution of our business priorities and maintaining a disciplined balance sheet. With that, I’ll turn it back to you, Joe.

Joseph Liotine, Chief Executive Officer, Versigent: Thanks, Doug. Versigent launched into the public market with a strong vision. We delivered solid performance with strong revenue growth, all while reinforcing our position as an industry leader. Above all, our team remains focused on the right things, driving revenue, increasing cash flow, and executing with a high level of operational discipline across the business to unlock greater value for our customers and our shareholders. With that, we are happy to take your questions. Operator, please open the line.

Chris McNally, Analyst, Evercore ISI0: Thank you. If you would like to ask a question, please signal by pressing star one on your telephone keypad. If you are using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Again, you can press star one to ask a question, and we will pause for just a moment to allow everyone an opportunity to signal for questions. We do ask that you would limit your questions to 1 question with a follow-up. Again, it will be star one to ask a question. We will now take your first question coming from the line of Chris McNally with Evercore ISI.

Chris McNally, Analyst, Evercore ISI: Great. Thanks so much, team, and congratulations on the first quarter out of the box. Maybe just one housekeeping, and then we’ll go a little bit more strategic. On the housekeeping, you know, could you just kind of give a sense for how you mentioned the 3 to 4 months on copper, you know, Q1, you know, seasonally light and to the copper hit. Could you just give us a sense for how we may see those, you know, sort of the earnings cadence over the course of Q2 to Q4? When probably at this sort of $6 level, you know, what’s a good quarter that we could sort of expect to be, you know, fully recouped by?

Douglas R. Ostermann, Chief Financial Officer, Versigent: Yeah. Thanks for the question, Chris. You know, we saw a pretty significant move up in the copper price during the first quarter, as you know, and, you know, it seems to stabilized a little bit in these last week or 2. Really with this kind of 3 to 4-month lag that we talked about, that’s built into the escalation of the contracts, typically we’re gonna see that start to play out in the first, you know, month of the second quarter. Really, you know, should be, for the most part, normalized by the time we get to kind of end of the second quarter, beginning of the third quarter. Now that, of course.

Assumes that copper pricing stays, you know, stable. That really should be kind of the cadence of the catch-up. Now, in addition, as you know, you know, we do hedge the portion of our or our copper exposure that is not covered by contract escalation. Really that just provides us some time to have conversations with our customers about the amount of copper and the change in the price and that sort of thing. That’s really the other 25%, that obviously has an immediately offsetting effect.

Chris McNally, Analyst, Evercore ISI: No, that makes sense. We’ve seen that smoothing effect in years past, like 2024 when you had the copper spike. Okay. Look, that all makes sense. Maybe a little bit on the strategic side. You know, I think we talked a little bit about in your former parent in Aptiv, you know, sort of these secondary TAM extensions that we’re seeing in industrial and you had some pretty exciting, you know, news over the course of marketing Versigent about, you know, $150 million of wins to battery storage, $3 billion TAM.

You know, is it fair to think of 2 years out that you could be a, you know, a significant player here, sort of that similar mid-teens, 20% market share that you’ve carried in auto? I just think investors, we all don’t know a lot about wire harness in that market. Anything that you can add about color of who’s playing in that market now, you know, because it seems like there’s a lot of runway for you to grow.

Joseph Liotine, Chief Executive Officer, Versigent: Thanks, Chris. This is Joe. You know, if we zoom out a little bit, you know, we’re focused there for a reason. You know, we’ve looked at our engineering skills and capabilities, and they apply, you know, quite well there without a lot of change or adaptation. We’ve looked at our manufacturing, and that applies as well. From an asset intensity and a capability development standpoint, we really don’t require effort there. What we have seen though is there is some go-to-market uniqueness and nuances that we need to, you know, kind of refine to make sure we’re ready for all those opportunities. We’re in quite a few different pre-development programs already. We have our first serial production here launched in Q1. You know, this is beyond just theory. You know, we’re seeing progress there.

I think the competitive market there from a supply standpoint is pretty diverse. You know, versus battery storage or robotics or even commercial vehicles. It’s not necessarily one cohesive group, but everything we’ve seen points to either customers are coming to us and asking us to participate, or we’re engaging with customers and getting very good receptivity. Now again, the battery side and robotics side is quite small today. Even if the growth is big, the, you know, the starting point, the absolute value is smaller. We feel really good about both our applicability and the potential of those TAMs. I would say early days, but you know, we’re just essentially reinforcing the strategy and the thesis that we laid out just a couple months ago.

Chris McNally, Analyst, Evercore ISI: Yeah. The customer overlap is really, really encouraging. Okay. Thanks so much, team. See you soon.

Douglas R. Ostermann, Chief Financial Officer, Versigent: Yeah. Thanks, Chris.

Joseph Liotine, Chief Executive Officer, Versigent: Thank you.

Chris McNally, Analyst, Evercore ISI0: All right. We’ll take your next question coming from the line of Joseph Spak with UBS.

Chris McNally, Analyst, Evercore ISI3: Hey, guys, this is Gabriel on for Joe. Thanks for taking my questions. Doug, you outlined the $0.13 quarterly dividend, so maybe a 1.4% current div yield. Can you help us think about how that could evolve over time, especially given, you know, similar auto supplier peers generally screen somewhat higher? Is this more of a starting point that will be re-reevaluated? I guess just more broadly with the new authorization, how should we think about the balance across your capital priorities going forward?

Douglas R. Ostermann, Chief Financial Officer, Versigent: Yeah. Thanks for the question, Gabriel. Really, you know, what we wanted to do was, you know, we had stated previously that we would have a competitive dividend. We wanted to provide some additional definition around that. We think that $0.13 a share, you know, is a good, you know, range that we’ll discuss with the board at the end once we have kind of Q2 earnings in the bag. We think that’s a good way to start returning some capital to our shareholders. Of course, you know, as earnings progress, you know, we’ll revisit that with the board from time to time, but I think that, you know, should help you get some order of magnitude on what we mean by a competitive dividend out the shoot.

When we look of course at the authorized buyback program that we discussed with the board, you know, I just wanna revisit the fact that really, you know, when we look at our overall capital allocation strategy, our number one priority of course is to continue to grow the business. We have a lot of nice organic opportunities. Joe just discussed a few of those. Really, even, you know, running at kind of that 3% of revenue in terms of CapEx, we should be generating, you know, a lot of cash beyond that. We thought it was important to get, you know, a buyback program authorized by the board.

Of course, we would seek to time that, you know, in coordination with when the cash is being generated by the business. As you probably know from our history, you know, cash generation is business typically is second half. I wouldn’t see us getting, you know, or even thinking about getting Aptiv on that front, you know, until kind of that time period.

Chris McNally, Analyst, Evercore ISI3: Got it. That’s really helpful. Joe, just following up on a question that was asked on the Aptiv call this morning on the, you know, conquest business, a competitor announced. I know there was a lot of color provided, wanted to ask if you had any further comments of your own on that. More broadly, discuss your competitive positioning going forward as a standalone company versus when you were a part of Aptiv.

Joseph Liotine, Chief Executive Officer, Versigent: Yeah, appreciate the question. You know, just to maybe clarify or reiterate a couple things that were said by Kevin. You know, again, we retain the vast majority of that program. A small amount was awarded to a competitor and on smaller, more basic harnesses. You know, I thought Kevin did a really good job bringing facts to the discussion in a comprehensive way, in a well-constructed way, and not just hyperbole. I think it’s important, you know, that, you know, GM took the time, so I’m appreciative of that. They took the time to say the things they did in a sanctioned, real comments that they stand behind. They cited us as the gold standard in wire harnesses.

You know, they cited us as a company in which they expect us to have future incremental opportunities. They also cited that we had 0 operational issues. You know, it’s just a testament to, I would say, a very valued customer of ours to go out of their way to do that. I think maybe the last thing I would say is, if we zoom out and look at the facts, you know, in 2025, our growth over market was strong and better than competition, as was our bookings. In Q1, our growth over market was strong and better than competition, as was our bookings. Our future outlook in terms of what we shared in our investor day and our thesis was strong growth over market as well.

You know, if you take all of those, that’s a comprehensive view of the business. That’s not just the shiny object to maybe distract from the broader dialogue. I think that’s important to keep that context together.

Chris McNally, Analyst, Evercore ISI3: Thank you very much.

Chris McNally, Analyst, Evercore ISI0: We’ll now take your next question coming from the line of Emmanuel Rosner with Wolfe Research.

Emmanuel Rosner, Analyst, Wolfe Research: Great. Thank you so much. I was curious if you could give us a little bit of color on how to think potentially about the current quarter. I think what makes it a little bit complicated in terms of understanding cadence exactly is obviously these commodity headwinds were very large, then, you know, the recovery. I would think that makes it a little bit more back-end loaded when you get the recoveries, but in terms of margin. Anything can you give us in terms of, you know, how to think either about Q2 or about the cadence of first half versus second half?

Douglas R. Ostermann, Chief Financial Officer, Versigent: Thanks for the question, Emmanuel. You know, we certainly started with a strong first quarter, and that gives us a lot of confidence in reaffirming our guidance. In terms of cadence, as you know, you know, in the automotive industry, typically from a volume perspective, Q1 is a bit lower. If you look at kind of the seasonality of the industry, we would expect more production in Q2, three and four. For us, you know, our margins historically have kind of peaked in Q3.

And really when I look at this year, you know, as we talked about, if copper prices stay relatively stable, we should see a majority of this, you know, copper headwind, from a timing perspective that we saw in Q1 work its way, through the system kind of by the end of Q2, beginning of Q3. We would expect margin progression. The other thing is, of course, you know, from our business that, when we have higher volumes as we expect in Q2, Q3 and Q4, at a 23% contribution margin, that also enhances of course our overall margin.

I would say, you know, when I think about the guide that we have kind of the midpoint, say at 10.7% adjusted EBITDA margin for the full year, I would say as we progress, probably 2/3 of that would be additional volumes that we expect in the coming quarters above kind of our current run rate. Maybe 1/3 of that would be related to this copper escalation as well as additional performance initiatives that will offset some of the headwinds that are naturally a part of our business.

Joseph Liotine, Chief Executive Officer, Versigent: Yeah. Maybe just to support the comments made by Doug. You know, if you look at what we did in Q1 and maybe what we did operationally in 2025 in terms of improvements, we’re essentially just continuing some of these things on the revenue side, the mix side and operational improvements. Obviously, the commodity side is a little bit more nuanced. You know, there isn’t a big change in business composition to achieve that. It’s more a continuation.

Emmanuel Rosner, Analyst, Wolfe Research: Okay. Just one quick clarification, then I’ve got another question. When Doug, when you’re saying that by the end of Q2 and of Q start of Q3, most of it would have, you know, you know, basically been offset. Do you mean that the entirety of the net headwind that we saw in Q1 would already be recovered, sort of like by end of Q2, beginning of Q3? Or that this is when it’s no longer a headwind and then you have to recover it in the second half?

Douglas R. Ostermann, Chief Financial Officer, Versigent: Yeah. If the copper prices stay relatively stable, what we would see is the escalation that’s built into the contracts. We’d see the commodity portion of the headwind, right, work its way through. Today it’s just in our cost, but it would join, you know, go into our revenue as the contracts escalate the pricing, right? What you’re left with is really just a little bit of dilution to margin, which would be relatively small, you know, overall from the higher copper price. Majority of that headwind would have worked its way through.

Emmanuel Rosner, Analyst, Wolfe Research: Okay. Then, you know, just going back to the, you know, the color you gave and Kevin gave about this, you know, GM business and I think a lot of very fair points that you’ve highlighted. I think one of the things Kevin was saying was, "Hey, this is a sort of like, you know, build-to-print type of business, sort of like lower margin." Can you clarify from a, you know, strategic and focus point of view on a go-forward basis, is that still sort of like attractive business you’re, you know, you’re looking to win and capture and continue to, you know, to grow? Or is there sort of like also a strategy which is to sort of like refocus on, you know, more profitable part of the business?

Joseph Liotine, Chief Executive Officer, Versigent: Yeah. I think it’s a great question. I think if you come back to what we’ve talked about as our competitive advantage and what we’ve demonstrated over a long period of time, that really stems from engineering expertise and I’d say a tool suite that’s proprietary from an engineering standpoint. We certainly wanna gravitate towards the things that are most complex, toward the things that are most innovative. That’s true. Maybe it is a bit of a bias in our strategic approach for sure. Having said that, you know, we wanna win all the business we can, you know, in many cases. I wouldn’t say it was necessarily us deselecting.

There is a bit of a natural bias for us, and sometimes we’re willing to do things a little more or a little less based on the margin profile. That’s certainly a consequence there. What Kevin was trying to share is, hey, this is a little bit of the more basic things. You know, not gonna have the best margin and characteristics like that. Having said that, we do a lot of that product as well, so I don’t wanna make it sound like we never do that ’cause that wouldn’t be accurate. We certainly have a bias to the biggest, most complex. That will remain going forward for sure.

Emmanuel Rosner, Analyst, Wolfe Research: Great. Thank you.

Chris McNally, Analyst, Evercore ISI0: Next question will come from the line of Colin Langan with Wells Fargo.

Colin Langan, Analyst, Wells Fargo: Oh, great. Thanks for taking my questions. You know, this morning I think Aptiv said that raw commodities were about 50, or a 50 basis point margin drag relative to their expectations. I assume you were using a similar assumption on raw materials. You’re able to hold the guide. How much worse was commodity and what are the offsets that you were seeing that enabled you to hold the guide?

Douglas R. Ostermann, Chief Financial Officer, Versigent: Yeah. Thanks for the question. I think, you know, when we look at, you know, the 50 basis points, that’s really, you know, the portion of the commodity activity that has been built into our pricing and our cost now. That when you look year-over-year, right? There is some copper movement that happened prior to Q1 that has now worked its way into our contracts. It is in our revenue line, it is also in our cost line, there’s no margin associated with that, it has a bit of a dilutive effect, right? That’s the 50 basis points that we talked about. The more important headwind is when we have it built into the cost, as we saw the rapid rise in copper in the first quarter, right?

It builds into our cost, but has not worked its way into the escalation of the contracts yet. We expect that to happen, majority of that to happen in the second quarter. That headwind will be significantly reduced. If you look at the kind of 210 basis points that we talked about for FX and commodities, in the chart on the adjusted EBITDA walk, about two-thirds of that is commodity related. Once that’s passed through, that will drop to like 20 basis points, that portion of it. In terms of just dilution, from the revenue being higher. It’s a headwind that is transitory and temporary in nature because of the way we’ve structured our contracts.

It needs to work its way through the system and I think And really as it works its way through, that’s why we’re still very confident in being able to, of course, meet our margin projections for the full year.

Colin Langan, Analyst, Wells Fargo: I guess just to follow up on this. It shouldn’t this have raised your sales, the higher copper pass through going through revenue and diluted your margin? I guess I’m trying to understand what maybe the offset would be and is I guess on that, is production lower now then? Is that the offset that you have higher copper and more lower production?

Douglas R. Ostermann, Chief Financial Officer, Versigent: No, I mean, it. When we have higher copper, you know, and we and it passes through the contracts, of course, it raises the overall margins. Sorry, it raises the overall revenue picture. That’s why we typically will talk about this adjusted growth on revenue where we adjust out the commodities and FX to give you an idea of kind of what is the organic growth, and that’s the 3% adjusted figure that we talked about in the call, you know, dialogue earlier. You know, so that’s really the driver in terms of, you know, this kind of enhancement to revenue.

Once that, you know, as I said, once it moves from our cost to also being in the revenue line, you know, those equal each other out, but there’s no margin on that piece of it. It’s a bit diluted because the divisor being larger, right? In terms of the overall revenue picture. Really, you know, the key to understanding the commodities exposure, I think, is to understand that 75% of our contracts have escalation in them. The other 25% we hedge on a 2-year horizon. We do have coverage for this. It just takes time to work through the system.

Colin Langan, Analyst, Wells Fargo: Okay. If I look at slide 11, you had really strong net performance of $31 million. If I look at the Aptiv slides from this morning, they actually said something about favorable commercial. Is some of that a commercial settlement in there that’s helping that? Is that the run rate we should be thinking about for the rest of the year? It seems quite helpful.

Douglas R. Ostermann, Chief Financial Officer, Versigent: Yeah. Really what, you know, what you’re seeing in that performance of positive performance of $31 million is materials performance. I talked a little bit about this in the dialogue. Materials performance that is negotiation with our suppliers and importantly, value add and value engineering done by our engineering teams. This is really a big differentiator that Joe’s talked about many times about, you know, the value that our engineering teams are adding to our customers’ products. Really that material performance as well as, you know, some manufacturing productivity and things like that are outweighing the labor economics and some of the mix that we see within the net performance figure. Positive number overall this quarter.

We expect to have further gains in that category as the year progresses.

Joseph Liotine, Chief Executive Officer, Versigent: Yeah. Just as a build a little bit to my comments earlier, you know, we had demonstrated that ability in full year 2025 as well. Much of that came out of North America. We will continue to those efforts ’cause we believe there’s more value across the globe to continue that. Hence that’s part of our story as we talk about a 2 point of margin improvement over the next couple of years. Part of that is the operational improvements along the way.

Colin Langan, Analyst, Wells Fargo: Okay, there’s no ’cause I think the Aptiv slide said favorable timing of recoveries was a help. We shouldn’t expect that there’s a one-off nature in this number, and that it maybe, you know, softens the rest of the year ’cause there was some one-off recovery.

Joseph Liotine, Chief Executive Officer, Versigent: No. I would think of it as a relatively clean quarter in terms of income, you know, or profit. We did have obviously some one-time events related to the separation. From a profit standpoint, relatively clean quarter. Nothing lumpy from a recovery standpoint. Nothing that would subtract from Q2 through Q4.

Colin Langan, Analyst, Wells Fargo: Okay. All right. Thank you very much for taking my question.

Joseph Liotine, Chief Executive Officer, Versigent: Thank you.

Chris McNally, Analyst, Evercore ISI0: Next question will come from the line of Itay Michaeli with TD Cowen.

Itay Michaeli, Analyst, TD Cowen: Great. Thanks. Good afternoon, everybody. I just wanted to start off to talk about kind of crossover growth over market, what your outlook there for the rest of the year. I think Q1 you were about roughly 5 points above market. It sounds like the guide for the year is more like 3. Maybe just talk about the puts and takes of how we should think about it the rest of the year and maybe whether there’s any kind of upside potential to that?

Douglas R. Ostermann, Chief Financial Officer, Versigent: I mean, I think, you know, you’re exactly on, when you’re looking at kind of our growth above market in first quarter was pretty strong. Really, I think, you know, some of the positives we saw in the first quarter as you saw from the regional detail that we shared was, you know, we kind of over-indexed with some of the customers in China who are very focused on export and frankly have, you know, outperformed some of the volumes that we had assumed in the budget and business plan. Some nice upside there that may or may not continue through the year, right now, you know, has been pretty strong.

I would say when we look at kind of the overall growth, you’re right. When we look at the way the market is expected to progress in terms of volumes, we would, you know, need to run at just a couple % above market growth to be well within the range of the guidance that we’ve provided from a revenue standpoint. That’s, we feel pretty comfortable that right now, given the outlook, and we have pretty good visibility of course on schedules in Q2 at this point. We feel pretty comfortable reaffirming our guidance. When we look at puts and takes, of course, you know, there are a couple of things to keep in mind as the year progresses.

One, we talked about, you know, whether commodities will kind of stabilize or continue to move around. Now of course, that’s something that we’re used to and that we deal with on a regular basis. That, you know, could impact kind of the cadence from quarter to quarter. We do have some very significant launches this year. It’s a big launch year for us. As you can imagine, our team is laser focused on execution this year. A very important year for some big launches. Of course, the macro impacts as everybody, we’re focused on all the geopolitical events and, you know, whether there could be knock-on effects on overall vehicle demand, you know, among our customer groups.

I would just say, really taking a look at our plans, and really, being focused on controlling the controllable. The things, that we execute on daily, you know, our team, you know, is gonna deliver, day in, day out. That’s really where our focus is. When you ask me kind of puts and takes, those are kind of I think the big hitters that I see.

Itay Michaeli, Analyst, TD Cowen: Very helpful. Then just as a two quick follow-ups. First, it looks like the, kind of the gross incremental margin was more like 30%, just looking at the volume on EBITDA versus revenue. I’m curious if Potentially could be sustainable as well. Second, on the bookings in Q1, I think that was up year-over-year, but curious just any thoughts there and any perhaps target to share for 2026 for bookings. Thank you.

Douglas R. Ostermann, Chief Financial Officer, Versigent: You’re just comparing the EBITDA contribution from volume of 20 over the 66 volume?

Itay Michaeli, Analyst, TD Cowen: That’s right.

Douglas R. Ostermann, Chief Financial Officer, Versigent: Yeah. I think that’s pretty much in line with the 23% that we typically quote, you know, as our, you know, contribution margin. I don’t see You know, it’s maybe, you know, kind of right in that range. Sometimes, you know, there can be, some, you know, smaller recoveries or things like that impact the number a bit.

Joseph Liotine, Chief Executive Officer, Versigent: A little bit of mix would be in there as well.

Douglas R. Ostermann, Chief Financial Officer, Versigent: Yeah, there’s some mix.

Joseph Liotine, Chief Executive Officer, Versigent: We did have favorable program growth in North America and a little bit on the export side. A little bit of mix in there as well.

Itay Michaeli, Analyst, TD Cowen: Got it. That’s very helpful.

Joseph Liotine, Chief Executive Officer, Versigent: The second part of your question was? Oh, sorry. Back to bookings. Yeah. We did have a good Q1. You know, frankly exactly on plan. We feel good about the bookings progress, and we feel good about the, you know, full year revenue forecast as Doug shared just a few moments ago. From that standpoint, I’d say exactly on track.

Chris McNally, Analyst, Evercore ISI0: We’ll now go to your next question, coming from the line of Tom Narayan with RBC Capital Markets.

Chris McNally, Analyst, Evercore ISI2: Hi, this is Thomas Eidell on for Tom. Thanks for taking the question. We’ve been seeing some improving electrification trends through Europe recently, especially with like hybrids and EVs given the elevated energy prices. Could you just help us understand whether that’s translating into any potential increased demand for your high voltage portfolio?

Joseph Liotine, Chief Executive Officer, Versigent: Yeah. As it pertains to EVs, both hybrid and full battery electric, I think it’s important to understand and remember that all BEVs have low voltage and high voltage, and all hybrids have both low voltage and high voltage. You know, oftentimes people maybe take a shortcut assuming high voltage is just BEV, you know, a lot of the content on a BEV is low voltage. What I would say is we are seeing some of those trends. They vary a little bit by region, you know, a bit more hybrid in America, a bit more BEV and maybe a lot more BEV in APAC, specifically China.

You know, as we’ve shared in other discussions, it’s about a 50% increase of content for a hybrid and greater than a 70% increase for a BEV. As those trends continue, they also happen in unison, right? They always happen together with more autonomous, more connected and more features. You know, those things are all kind of moving at the same time. As that continues, you know, we do think vehicles get more complex, architectures get more complex, and the content per vehicle generally, you know, moves in those kind of heuristic trends. That is gonna be beneficial if they continue to move maybe more than people expected.

Chris McNally, Analyst, Evercore ISI2: Okay. Gotcha. Very helpful. As a quick follow-up, so on your APAC growth, and maybe specifically to focus on China, are there any updates you can give us on maybe your overall exposure to the Chinese OEMs versus some of the global OEMs? Is there like any target % of APAC revenues coming from the Chinese OEMs?

Joseph Liotine, Chief Executive Officer, Versigent: Yeah. You know, for us strategically, and this is true across every region, our goal, our aspiration is always to match the market with how the market’s constructed. After that, what we do is we layer in our strategy and our strategic filters. What that does is there’s a natural selection toward more complex vehicles, as we’ve talked about a little bit, toward, you know, things that really fit for us. You know, the China market in particular has, you know, greater than 110 or 18 brands. We don’t necessarily need to match 118 or 110. We pick the ones that kind of really have the right volume, have the right complexity, we think are most sustainable.

We bias toward the OEMs that do a lot of export and that also want to localize in other regions, because again, as a global provider, we’re a very good partner as they want to do those things. As we look at that, you know, we’re continuing to increase our local Chinese OEM share. That’s been true for the last couple of years. I think we’ve shared publicly in 2025, greater than 75% of all of our bookings was with local Chinese OEMs. Essentially, you know, showing the trend, showing our competitiveness and our credibility in that market, and that will continue. Again, we will look to match the market, but with our strategic filter in place as well.

Chris McNally, Analyst, Evercore ISI2: Okay. Thank you so much.

Chris McNally, Analyst, Evercore ISI0: Next question will come from the line of Edison Yu with Deutsche Bank.

Edison Yu, Analyst, Deutsche Bank: Great. Thanks.

Thanks for taking our questions and giving us the first quarter out. I want to come back on the growth. Is there any way you can kind of break down the growth for both the quarter and the full year expectations for high versus low voltage?

Douglas R. Ostermann, Chief Financial Officer, Versigent: As we talked about, growth in the first quarter year-over-year was 9%. Once we adjust out the FX and commodities, we’re roughly at 3%. When we think about growth over market, the market was down 2% or 3%. Growth over market probably 5%-6% overall in the first quarter. When we look at our outlook and the guidance that we’ve reaffirmed, if we look at the step up in volumes, it’s just part of the seasonality of the industry, right? We see volumes growing significantly, as does IHS in Q2, Q3 and Q4.

Really to hit our guidance, we would need to run at just a 2% above that, you know, which is typical for us from a revenue standpoint, to run a 2 percentage above just a standard vehicle, you know, production growth. That’s, that’s really where we need to run, is just a 2 percentage above market growth. Then in terms of electrification mix, Joe, I don’t know if you want to take that.

Joseph Liotine, Chief Executive Officer, Versigent: Yeah. I would say, continued growth there kind of with the market. Nothing unique about the composition of our revenue in Q1 that was different than the market trends. Again, different by region. You know, weighting that to our business in the region, but within region, fairly, consistent with the IHS trends on electrification.

Edison Yu, Analyst, Deutsche Bank: Got it. Just a follow-up on China. Anything you can point to in terms of the kind of dynamics there, whether it’s on high voltage versus low voltage or on the growth of a market going through the rest of the year?

Joseph Liotine, Chief Executive Officer, Versigent: Just generally, I think, you know, what we saw, I would say really in the back half of last year in 2025 in terms of trends, in terms of the export volume, in terms of electrification and BEVs specifically, less so on hybrid. Those trends continue, frankly, even accelerated a little bit, in Q1. Export in particular, I think as that local market has a bit more downward pressure, you know, there on the market. You’re seeing the export and the localization dialogue increase from the local Chinese OEMs and frankly from the global OEMs who are based in China. I think thematically, that’s probably the biggest move in the last 6 or 9 months, is that, you know, how will that dynamic play out? How long will those export trends happen?

How much localization will happen in EMEA or South America or elsewhere? That’s probably the biggest new news that really is kind of maturing.

Edison Yu, Analyst, Deutsche Bank: Got it. Thanks.

Chris McNally, Analyst, Evercore ISI0: We will now go to your next question coming from the line of Steven Fox with Fox Advisors.

Chris McNally, Analyst, Evercore ISI1: Hi. Good afternoon. I had 2 as well. I guess, first of all, I just was wondering structurally in terms of passing through and then recovering higher copper costs. Is this industry standard sort of here to stay? The reason I ask is ’cause I know in other industries like, you know, network and cable, the recovery can be like within a month. What’s the prospects for sort of improving on that recovery time? I don’t know if it has improved over the years or also just can you address how you’re hedging as well? I had a follow-up.

Joseph Liotine, Chief Executive Officer, Versigent: Maybe I’ll start with some of the contracting strategy, and then Doug can complement on the hedging, you know, approach and strategy as well. You know, I think on the copper, you know, whenever there’s big changes, you know, everyone kind of wants to reevaluate the structure of everything, as they should. The context is quite different. We’ve not seen necessarily the amount of movement in a small window of time that we’ve seen in the last, let’s say, 6 or so months. You know, maybe there’s gonna be some changes that come. I would say there are some differences already by region, and there are some differences already by customer.

It’s really thinking about if the context is going to be a bit more dynamic, are there better mechanisms to do this, both from the supply standpoint as well as the customer standpoint? Because those need to be kind of done in unison. I would say, you know, reevaluating some of those things. We’d obviously like less gap, less lag on some of these things. You know, we’ll see if anything changes. Part of that has to do with, you know, negotiation with customers and then by region, there’s different nuances as well. I would say that’s more an open question than it is maybe a commitment that something’s going to be different in the future. When there’s times change, we should probably reevaluate and say, is there a better way to do things?

That’s gonna be more on the contract strategy side. I’ll turn it back to Doug on the hedge strategy side.

Douglas R. Ostermann, Chief Financial Officer, Versigent: On the portion that where we don’t have escalation built specifically into the contracts, for that roughly say 20% to 25% of our overall copper buy, we do hedge that position through the financial markets. We hedge it typically on a 2-year horizon. We kinda leg into those positions over time. It basically kind of delays the impact of the copper move on our financials, and it gives us time, frankly, to have some discussions with those customers, about the impact that it’s having on the cost structure of the products that we provide to them. That those conversations are pretty transparent. I mean, our customers understand how much copper is in their product.

you know, Obviously, the indexes are easily observed, those tend to be pretty transparent and productive discussions. The hedging obviously gives us some time to have those conversations and then work out the proper adjustment.

Chris McNally, Analyst, Evercore ISI1: Great. That’s helpful. Just as a follow-up, I know build-to-print is not, you know, a big portion of your revenue base. I guess how do we think about it as a necessary evil to maintaining these customer relationships? Why can’t you sort of move entirely away from that and focus more on where you have design control and can make a better margin?

Joseph Liotine, Chief Executive Officer, Versigent: Yeah. To your point, you know, about 25% of our revenue is non-influenced design. That’s not necessarily synonymous with build-to-print because there are instances that are somewhere in the middle. I think what I would say is, you know, we obviously do those things today. We do them for a reason. There could be very complex build-to-print architectures that still fall into what we think are important, and we still can drive quality improvements and other design improvements along the way as we see them. You know, to me, it’s not as simple as build-to-print or not. What’s more critical is its complexity and the value we can drive along the way.

It’s just common, though, that some of the more basic, simpler, shorter, smaller harnesses end up being build-to-print because there isn’t, you know, there isn’t much to solve for. They’re not exactly synonymous. I would say we evaluate things based on our criteria of value creation, our ability to, you know, really make a better product for our customer even better. Yeah, sometimes there’s some consequences where build-to-print product just doesn’t meet our criteria, and they fall out or we don’t necessarily bid, or maybe we don’t necessarily win in some cases. I think that’s okay. Our goal is not to win everything. Our goal is to win the most value-creating businesses and support our business behind that, where we’re adding the most value to customers.

Chris McNally, Analyst, Evercore ISI1: Great. That’s a really helpful perspective. Thank you very much.

Chris McNally, Analyst, Evercore ISI0: We’ll now take your next question coming from the line of James Picariello with BNP Paribas.

James Picariello, Analyst, BNP Paribas: Hi, everybody. I wanna ask about the free cash flow for this year. $250 million at the midpoint. The $70 million of separation costs go to zero for next year. Is that right? Is your restructuring cash spend also running elevated this year as well? Just any color on that amount for this year and the normalized run rate would be great. Thank you.

Douglas R. Ostermann, Chief Financial Officer, Versigent: I can give you some perspective on that. We did talk about restructuring, one-time restructuring expenses of about $70 million for the full year. You know, one-time separation expense of $70 million for the full year. Those expenses really in the first quarter were right around $26 million within the cash flow. We’re kind of a little bit higher run rate than the 70, but we really, as I kind of outlined, expect those to decline over time. We feel like we’re pretty much on track for the $70 million that I mentioned. We do expect those to drop in about half that number for next year and then disappear altogether.

One-time total between the two years of about $100 million, but constantly declining from kind of the 26 that we saw this quarter. You know, if we look at restructuring, you know, some years is higher than others, tends to be kind of lumpy. This year, we did talk about the fact that restructuring would be kind of higher than normal, right around the kind of $100 million range. We saw roughly a quarter of that kind of in the cash impact, about $26 million-$27 million in the cash flow this quarter. I would say right on track. I would say the other thing to recognize when we look at year-over-year cash flow is that last year we had a relatively low level of CapEx spending for this business.

Last year, when I look at the CapEx, you know, we only spent about $160 million. This year, we’ve talked about kinda 3% of revenue, right around the 240 range. You should expect, you know, kind of that 80 difference to play out over the quarter. Roughly, you know, say $20 million more per quarter. Because of the launch expenses, you know, this quarter, we were more like $30 million more than a year ago first quarter. That’s really, I would say, back to a more normalized level of CapEx. You know, in terms of, you know, go forward, kind of more normalized rate, I think, you know, like I said, next year you’d see that 70 drop into about half.

you know, we don’t have a full restructuring plan for next year, but I think this year will be kind of unusually high, so I would, I would anticipate that that may come down as well a bit. In terms of cadence, I think your second part of your question was kind of cadence throughout the year. I would just say that, you know, if you look at our history, typically, we’re ramping up from kind of the seasonal downtime with our customers at the end of the calendar year in the first quarter. That tends to be an outflow of working capital. We typically also see a step-up, you know, in use of working capital second quarter. Third and fourth quarter is really where we see the stronger cash generation typically.

James Picariello, Analyst, BNP Paribas: Perfect. No, that’s really helpful. Thank you. Just to go back to, you know, it was Colin’s question, maybe addressed in other questions as well, but on the full year FX and commodities margin dilution, right?

The first quarter combined, it was 260 basis points dilutive, right? Which speaks to the great underlying profitability that you guys showed in the first quarter. Is the full year expectation still at that 50 basis points dilution target, or is it?

Douglas R. Ostermann, Chief Financial Officer, Versigent: I-

James Picariello, Analyst, BNP Paribas: Is it running a little heavier with some offsets?

Douglas R. Ostermann, Chief Financial Officer, Versigent: Yeah. I think if commodity prices stay roughly in the range where they’re at today, I think we might see another, say, 15-20 basis points of headwind as we, you know, work it into the revenue picture. You’re talking about total headwind from just the larger revenue base of maybe 70 basis points overall. But we do feel like there’s a real opportunity to offset that. We are still holding our guidance at the 10.7%. You know, we have a lot of productivity initiatives that we’re working on. We feel pretty good about the margin outlook as volumes increase later in the year. We think that the 10.7% that we’ve guided towards is still very achievable.

Joseph Liotine, Chief Executive Officer, Versigent: Perfect. Thank you, guys.

Douglas R. Ostermann, Chief Financial Officer, Versigent: Thank you.

Chris McNally, Analyst, Evercore ISI0: Your final question is coming from the line of Dan Levy with Barclays.

Dan Levy, Analyst, Barclays: Hi. Good evening. Thank you for taking the question. Wanted to ask more of a strategic question and sort of in light of the copper prices that, you know, continue to go up and could just be structurally going up. Your 75% pass-through. Now, we’ve also heard that on the performance side, you’ve talked a lot about automation. I guess the question is where are you on the automation journey? You know, how much more is there to unlock on automation? Is that effectively sort of the structural hedge against the higher copper prices, that as this just becomes more expensive, you’re gonna lean more heavily on the automation side?

Joseph Liotine, Chief Executive Officer, Versigent: Good question. I think of it slightly differently. The automation side is more of a natural hedge for labor wage inflation because we’re able to essentially, you know, do the work differently and as a consequence, have less direct labor. I think that’s more of a natural hedge. The copper side of things is more on engineering design, engineering optimization, potentially substrate and metallurgy changes we can do with aluminum or other things. That’s more on the technical side for copper because you’re really changing the product, and the characteristics of the product have to meet performance requirements about thermal and peak and other things. Whereas the automation is changing how we construct the product, not the product itself. Hence, it’s more of a labor wage hedge. It’s maybe the simple way to think about it.

Not perfect, but simple, I think.

Dan Levy, Analyst, Barclays: Right. Where are you in that journey on automation?

Joseph Liotine, Chief Executive Officer, Versigent: I would say, we’ve made a lot of progress. Most of our progress stems in our China model and plants. We’ve done a really good job there. We have essentially a strategic approach on how to tackle it. We have a lot of really productive ideas that we think have really short paybacks, we’re really kind of amplifying that work and that scaling. That’s one of the things as we look at what can Versigent do differently and better as a separate standalone company. Frankly, capital deployment is one of the big value creators and part of our thesis to really fund these ideas that improve our operations that, you know, likely have a benefit to margin, as we talked about.

You know, half a point over the next 2 years of the 2-point improvement, and then frankly, quality and other benefits on top of that. I think that’s what you really see to date. We’ve made progress globally, but specifically and maybe most in China. Really our plan for the next 2 years is to accelerate that scaling throughout the globe because we think they’re quite good in terms of payback standpoint.

Dan Levy, Analyst, Barclays: Great. Thank you. Then a follow-up, again, another strategic question. You know, it was asked earlier on build-to-print and that, you know, on the flip side, 75% of your revenue is highly engineered. Can you maybe talk about where the booking trends are, especially as automakers are starting to revisit, you know, some of their architectures? How is that impacting that 75% rate of highly engineered versus the 25% that’s a bit more sort of base content build-to-print?

Joseph Liotine, Chief Executive Officer, Versigent: Yeah. You know, obviously the world’s getting more and more complex, these architectures are getting more and more complex with it. No matter what people would like to do, there’s the natural practicality of sometimes you need help to get these complex solutions to be more optimized. You know, 5 years ago, I think it is, we were 20 points less revenue that was influenced by our engineers than we are today. The trend in the last 5 years has grown dramatically. We were at about 50-55 points, now we’re at 75 points of revenue. I expect some continued appreciation there, but it’s not like we’re gonna go to a 100%. There’s lots of reasons for that, but I don’t see it going or reverting back toward the 50% anytime soon either.

As we enter adjacent markets, I think those needs are the same. If you think about autonomous, remote diagnostics, connectivity, all these complexities are absolutely growing in those areas as well. That, that need for technical expertise, that need for joint development, pre-development, I don’t see that going dramatically different than where it is today. It might not increase, you know, to 100%, but kind of where we are today feels like, you know, a pretty good equilibrium. What we’re seeing in the future, you know, I have no reason to believe it’s different than what we’re doing today.

Dan Levy, Analyst, Barclays: Great. Thank you. Very helpful.

Chris McNally, Analyst, Evercore ISI0: It appears there are no additional questions at this time. I will now turn it back to Joe for closing remarks.

Joseph Liotine, Chief Executive Officer, Versigent: Great. Thank you. Thank you all for joining us today and for your interest in Versigent. On behalf of our entire leadership team, we’re pleased with the execution and progress delivered in the first quarter and remain focused on building on the momentum as we move in through 2026. We look forward to sharing further updates with you next quarter. Thank you.

Chris McNally, Analyst, Evercore ISI0: This concludes today’s call. Thank you for your participation. You may now disconnect.