Dana Incorporated (NYSE: DAN) posts $3.9B 6M sales after Off-Highway divestiture
Dana Incorporated reported Q2 2026 net sales of $2,010 million, up from $1,935 million, generating earnings from continuing operations before taxes of $59 million and net income from continuing operations of $11 million. Q2 net income attributable to the parent was a small loss of $5 million, driven by a $11 million loss from discontinued operations.
For the first six months of 2026, net sales were $3,878 million and continuing operations posted a modest loss of $4 million. Discontinued operations, primarily the sale of the Off-Highway business, contributed $1,095 million of net income, leading to net income attributable to the parent of $1,082 million and basic EPS of $9.93.
Dana received gross cash proceeds of $2,664 million from the Off-Highway sale and used this and other cash flows to reduce short-term debt to $0 and long-term debt (including current portion) to $1,344 million, while total assets were $6,113 million and total equity $1,983 million at June 30, 2026. The company repurchased 5.7 million shares for $169 million year-to-date and paid quarterly dividends of $0.12 per share.
Dana is pursuing a Reverse Morris Trust transaction to combine with Eaton’s Vehicle and eMobility businesses; former Eaton shareholders are expected to own at least 50.1% of the new parent, with Dana shareholders owning no more than 49.9%. To support this, Dana and an Eaton subsidiary arranged a $2,600 million bridge facility plus committed term loan and revolving credit facilities. 2026 results also include $59 million in electric vehicle program termination charges, $20 million of strategic transaction expenses, and ongoing restructuring costs focused on facility consolidation and approximately 200 planned headcount reductions.
Positive
- $1,095 million net income from discontinued operations in 6M 2026, largely from the Off-Highway sale, drove net income attributable to the parent to $1,082 million and basic EPS of $9.93.
- Balance sheet strengthened as total liabilities fell to $4,130 million and total equity rose to $1,983 million, with long-term debt (including current portion) reduced to $1,344 million at June 30, 2026.
- Q2 2026 segment EBITDA improved to $211 million from $159 million a year earlier, and 6M segment EBITDA rose to $386 million, reflecting better operating performance in both Light Vehicle and Commercial Vehicle segments.
Negative
- Continuing operations remained weak, with a $4 million loss for 6M 2026 and net cash used in operating activities of $10 million from continuing operations and $86 million in total.
- Dana recorded $59 million of electric vehicle program termination charges and $15 million of restructuring charges in 6M 2026, signaling program cancellations, lower EV volumes and ongoing footprint and headcount reductions.
- Strategic transaction expenses related to the planned Eaton Mobility combination reached $20 million in 6M 2026, and the agreements include a potential $159 million termination fee and up to $20 million of expense reimbursement under certain outcomes.
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Reverse Morris Trust financial
mandatorily redeemable noncontrolling interest financial
cross-currency swaps financial
disposal group held for sale financial
performance share units financial
Section 232 tariff credits financial
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Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form
| | Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
For the quarterly period ended:
OR
| | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
For the Transition Period From to
Commission File Number:
Dana Incorporated
(Exact name of registrant as specified in its charter)
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Registrant’s telephone number, including area code: (
Securities registered pursuant to Section 12(b) of the Act:
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes
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DANA INCORPORATED – FORM 10-Q
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2026
TABLE OF CONTENTS
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10-Q Pages |
| PART I – FINANCIAL INFORMATION |
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Financial Statements |
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Consolidated Statement of Operations (Unaudited) |
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Consolidated Statement of Comprehensive Income (Unaudited) |
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Consolidated Balance Sheet (Unaudited) |
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Consolidated Statement of Cash Flows (Unaudited) |
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Notes to Consolidated Financial Statements (Unaudited) |
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Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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Quantitative and Qualitative Disclosures About Market Risk |
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Controls and Procedures |
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| PART II – OTHER INFORMATION |
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| Item 1 |
Legal Proceedings |
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Risk Factors |
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Unregistered Sales of Equity Securities and Use of Proceeds |
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| Item 5 | Other Information | 43 |
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Exhibits |
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PART I – FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Dana Incorporated
Consolidated Statement of Operations (Unaudited)
(In millions, except per share amounts)
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Net sales | $ | $ | $ | $ | ||||||||||||
| Costs and expenses | ||||||||||||||||
| Cost of sales | ||||||||||||||||
| Selling, general and administrative expenses | ||||||||||||||||
| Amortization of intangibles | ||||||||||||||||
| Restructuring charges, net | ||||||||||||||||
| Other income (expense), net | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Earnings from continuing operations before interest and income taxes | ||||||||||||||||
| Loss on extinguishment of debt | ( | ) | ||||||||||||||
| Interest income | ||||||||||||||||
| Interest expense | ||||||||||||||||
| Earnings (loss) from continuing operations before income taxes | ( | ) | ( | ) | ||||||||||||
| Income tax expense | ||||||||||||||||
| Equity in earnings of affiliates | ||||||||||||||||
| Net income (loss) from continuing operations | ( | ) | ( | ) | ( | ) | ||||||||||
| Net income (loss) from discontinued operations | ( | ) | ||||||||||||||
| Net income | ||||||||||||||||
| Less: Noncontrolling interests net income from continuing operations | ||||||||||||||||
| Net income attributable to the parent company | $ | ( | ) | $ | $ | $ | ||||||||||
| Net income (loss) per share available to common stockholders | ||||||||||||||||
| Basic earnings (loss) per share from continuing operations | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||||
| Basic earnings (loss) per share from discontinued operations | ( | ) | ||||||||||||||
| Basic earnings per share | $ | ( | ) | $ | $ | $ | ||||||||||
| Diluted earnings (loss) per share from continuing operations | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||||
| Diluted earnings (loss) per share from discontinued operations | ( | ) | ||||||||||||||
| Diluted earnings per share | $ | ( | ) | $ | $ | $ | ||||||||||
| Weighted-average common shares outstanding | ||||||||||||||||
| Basic | ||||||||||||||||
| Diluted | ||||||||||||||||
The accompanying notes are an integral part of the consolidated financial statements.
Dana Incorporated
Consolidated Statement of Comprehensive Income (Unaudited)
(In millions)
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Net income (loss) from continuing operations | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||||
| Other comprehensive income (loss) from continuing operations, net of tax: | ||||||||||||||||
| Currency translation adjustments | ||||||||||||||||
| Hedging gains and losses | ( | ) | ( | ) | ||||||||||||
| Defined benefit plans | ( | ) | ||||||||||||||
| Other comprehensive income from continuing operations | ||||||||||||||||
| Total comprehensive income from continuing operations | ||||||||||||||||
| Net income (loss) from discontinued operations | ( | ) | ||||||||||||||
| Other comprehensive income from discontinued operations, net of tax: | ||||||||||||||||
| Currency translation adjustments | ||||||||||||||||
| Hedging gains and losses | ||||||||||||||||
| Other comprehensive income from discontinued operations | ||||||||||||||||
| Total comprehensive income (loss) from discontinued operations | ( | ) | ||||||||||||||
| Total comprehensive income | ||||||||||||||||
| Less: Comprehensive income from continuing operations attributable to noncontrolling interests | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Comprehensive income attributable to the parent company | $ | $ | $ | $ | ||||||||||||
The accompanying notes are an integral part of the consolidated financial statements.
Dana Incorporated
Consolidated Balance Sheet (Unaudited)
(In millions, except share and per share amounts)
| June 30, | December 31, | |||||||
| 2026 | 2025 | |||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Accounts receivable | ||||||||
| Trade, less allowance for doubtful accounts of $12 in 2026 and $15 in 2025 | ||||||||
| Other | ||||||||
| Inventories | ||||||||
| Other current assets | ||||||||
| Current assets of disposal group held for sale | ||||||||
| Total current assets | ||||||||
| Intangibles | ||||||||
| Deferred tax assets | ||||||||
| Other noncurrent assets | ||||||||
| Investments in affiliates | ||||||||
| Operating lease assets | ||||||||
| Property, plant and equipment, net | ||||||||
| Noncurrent assets of disposal group held for sale | ||||||||
| Total assets | $ | $ | ||||||
| Liabilities and equity | ||||||||
| Current liabilities | ||||||||
| Short-term debt | $ | $ | ||||||
| Current portion of long-term debt | ||||||||
| Accounts payable | ||||||||
| Accrued payroll and employee benefits | ||||||||
| Taxes on income | ||||||||
| Current portion of operating lease liabilities | ||||||||
| Other accrued liabilities | ||||||||
| Current liabilities of disposal group held for sale | ||||||||
| Total current liabilities | ||||||||
| Long-term debt, less debt issuance costs of $8 in 2026 and $16 in 2025 | ||||||||
| Noncurrent operating lease liabilities | ||||||||
| Pension and postretirement obligations | ||||||||
| Other noncurrent liabilities | ||||||||
| Noncurrent liabilities of disposal group held for sale | ||||||||
| Total liabilities | ||||||||
| Commitments and contingencies (Note 12) | ||||||||
| Parent company stockholders' equity | ||||||||
| Preferred stock, 50,000,000 shares authorized, $0.01 par value, no shares outstanding | ||||||||
| Common stock, 450,000,000 shares authorized, $0.01 par value, 107,576,158 and 112,284,138 shares outstanding | ||||||||
| Additional paid-in capital | ||||||||
| Retained earnings | ||||||||
| Treasury stock, at cost (2,508,917 and 1,944,700 shares) | ( | ) | ( | ) | ||||
| Accumulated other comprehensive loss | ( | ) | ( | ) | ||||
| Total parent company stockholders' equity | ||||||||
| Noncontrolling interests | ||||||||
| Total equity | ||||||||
| Total liabilities and equity | $ | $ | ||||||
The accompanying notes are an integral part of the consolidated financial statements.
Dana Incorporated
Consolidated Statement of Cash Flows (Unaudited)
(In millions)
| Six Months Ended | ||||||||
| June 30, | ||||||||
| 2026 | 2025 | |||||||
| Operating activities | ||||||||
| Net income | $ | $ | ||||||
| Less: Net income from discontinued operations | ||||||||
| Net income (loss) from continuing operations | ( | ) | ( | ) | ||||
| Depreciation | ||||||||
| Amortization | ||||||||
| Amortization of deferred financing charges | ||||||||
| Earnings of affiliates, net of dividends received | ( | ) | ( | ) | ||||
| Stock compensation expense | ||||||||
| Deferred income taxes | ( | ) | ||||||
| Pension expense, net | ( | ) | ||||||
| Change in working capital | ( | ) | ( | ) | ||||
| Change in other noncurrent assets and liabilities | ( | ) | ( | ) | ||||
| Loss on divestiture of ownership interests | ||||||||
| Noncash electric vehicle program termination charges | ||||||||
| Other, net | ( | ) | ||||||
| Net cash used in operating activities from continuing operations | ( | ) | ( | ) | ||||
| Net cash provided by (used in) operating activities from discontinued operations | ( | ) | ||||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| Investing activities | ||||||||
| Purchases of property, plant and equipment | ( | ) | ( | ) | ||||
| Proceeds from sale of property, plant and equipment | ||||||||
| Proceeds from sales of investments | ||||||||
| Settlements of undesignated derivatives | ( | ) | ( | ) | ||||
| Other, net | ||||||||
| Net cash used in investing activities from continuing operations | ( | ) | ( | ) | ||||
| Net cash provided by (used in) investing activities from discontinued operations | ( | ) | ||||||
| Net cash provided by (used in) investing activities | ( | ) | ||||||
| Financing activities | ||||||||
| Net change in short-term debt | ( | ) | ||||||
| Repayment of long-term debt | ( | ) | ( | ) | ||||
| Dividends paid to common stockholders | ( | ) | ( | ) | ||||
| Repurchases of common stock | ( | ) | ( | ) | ||||
| Distributions to noncontrolling interests | ( | ) | ( | ) | ||||
| Payment for mandatorily redeemable noncontrolling interest | ( | ) | ||||||
| Swap settlements | ( | ) | ||||||
| Other, net | ( | ) | ( | ) | ||||
| Net cash provided by (used in) financing activities | ( | ) | ||||||
| Net decrease in cash, cash equivalents and restricted cash | ( | ) | ( | ) | ||||
| Cash, cash equivalents and restricted cash – beginning of period | ||||||||
| Effect of exchange rate changes on cash balances | ( | ) | ||||||
| Cash, cash equivalents and restricted cash – end of period (Note 5) | $ | $ | ||||||
| Non-cash investing activity | ||||||||
| Purchases of property, plant and equipment held in accounts payable | $ | $ | ||||||
The accompanying notes are an integral part of the consolidated financial statements.
Dana Incorporated
Index to Notes to Consolidated Financial Statements
| 1. |
Organization and Summary of Significant Accounting Policies |
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| 2. | Discontinued Operations |
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Intangible Assets |
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| 4. |
Restructuring of Operations |
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| 5. |
Supplemental Balance Sheet and Cash Flow Information |
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| 6. |
Stockholders' Equity |
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| 7. |
Earnings per Share |
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| 8. |
Stock Compensation |
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| 9. |
Pension and Postretirement Benefit Plans |
| 10. |
Financing Agreements |
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| 11. |
Fair Value Measurements and Derivatives |
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| 12. |
Commitments and Contingencies |
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| 13. |
Warranty Obligations |
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| 14. |
Income Taxes |
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| 15. |
Other Income (Expense), Net |
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| 16. |
Revenue from Contracts with Customers |
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Segments |
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| 18. |
Equity Affiliates |
Notes to Consolidated Financial Statements (Unaudited)
(In millions, except share and per share amounts)
Note 1. Organization and Summary of Significant Accounting Policies
General
Dana Incorporated (Dana) is headquartered in Maumee, Ohio and was incorporated in Delaware in 2007. Dana is a global provider of high technology driveline (axles, driveshafts and transmissions); sealing and thermal-management products; and motors, power inverters, and control systems for electric vehicles with a customer base that includes virtually every major on-highway vehicle manufacturer in the world.
The terms "Dana," "we," "our" and "us," when used in this report, are references to Dana. These references include the subsidiaries of Dana unless otherwise indicated or the context requires otherwise.
Summary of significant accounting policies
Basis of presentation — Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (GAAP) for interim financial information. These statements are unaudited, but in the opinion of management include all adjustments (consisting only of normal recurring adjustments) necessary for a fair statement of the results for the interim periods. The results reported in these consolidated financial statements should not necessarily be taken as indicative of results that may be expected for the entire year. The financial information included herein should be read in conjunction with the consolidated financial statements in Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2025 (the 2025 Form 10-K). Certain prior year amounts have been reclassified to conform to the current presentation.
On January 1, 2026, we completed the previously announced sale of our Off-Highway business to Allison Transmission Holdings, Inc. The sale was consummated pursuant to the terms and conditions of the definitive agreement to sell that we entered in June 2025. A component of an entity is reported in discontinued operations after meeting the criteria for held for sale classification if the disposition represents a strategic shift that has, or will have, a major effect on the entity’s operations and financial results. We analyzed the quantitative and qualitative factors relevant to the divestiture of our Off-Highway business and determined that the conditions for discontinued operations presentation have been met. As such, the financial position, results of operations and cash flows of that business are reported as discontinued operations in the accompanying consolidated financial statements. Prior period amounts have been recast to reflect discontinued operations presentation. See Note 2 for additional information.
Recently adopted accounting pronouncements
In July 2025, the FASB issued ASU 2025-05, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, which introduces a practical expedient that allows entities to assume conditions existing at the balance-sheet date will remain constant over the remaining life of current accounts receivable and contract assets arising from revenue transactions. We adopted this ASU effective January 1, 2026 and elected to utilize the practical expedient. The adoption of this amendment did not have a material impact on our consolidated financial statements.
Recently issued accounting pronouncements
In December 2025, the Financial Accounting Standards Board (FASB) issued ASU 2025-10, Government Grants (Topic 832), which addresses the recognition, measurement, presentation and disclosure of government grants, including grants related to income and grants related to assets. The new guidance leverages the principles in the accounting framework for government assistance in IFRS, specifically IAS 20, with certain targeted improvements. This ASU requires entities to recognize government grants only when it is probable that the entity will meet the stipulated grant conditions and ultimately receive the grant funds. This ASU provides two acceptable methods for accounting for grants related to assets: the grant may be initially recognized as deferred income, or it may be recorded as an adjustment to reduce the cost basis of the related asset. For grants related to income, the standard mandates that these shall be consistently recognized as deferred income. Deferred grants should be recognized in earnings on a systematic and rational basis either under a general heading such as other income or deducted from the related expense. The guidance is effective for annual reporting periods beginning after December 15, 2028, and interim reporting periods within those annual reporting periods; early adoption is permitted. We do not expect this guidance to have a material impact on our consolidated financial statements and related disclosures.
In November 2025, the FASB issued ASU 2025-09, Derivatives and Hedging (Topic 815), which provides targeted amendments to better align U.S. GAAP with common risk management practices. The guidance simplifies cash flow hedge accounting for forecasted transactions primarily by allowing entities to hedge a broader group of risks using a single derivative. Additionally, the ASU expands the scope of qualifying hedged items to include certain nonfinancial components, creates an optional accounting model for "choose-your-rate" debt instruments, and eliminates the recognition mismatch for dual hedge strategies. The guidance is effective for annual reporting periods beginning after December 15, 2026; early adoption is permitted. We do not expect this guidance to have a material impact on our consolidated financial statements and related disclosures.
In September 2025, the FASB issued ASU 2025-06, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which eliminates the sequential software development-stage model and requires capitalization when management authorizes and commits to funding a software project and determines it is probable of completion. In evaluating whether it is probable the project will be completed, management is required to consider whether there is significant uncertainty associated with the development activities of the software. The guidance is effective for annual reporting periods beginning after December 15, 2027, and interim periods within those annual reporting periods, with early adoption permitted. We are currently evaluating the impact of the guidance on the consolidated financial statements and related disclosures.
In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses (Subtopic 220-40), which requires public entities to disclose detailed components of income statement expenses, such as inventory purchases, employee compensation, depreciation and amortization within relevant expense captions. Companies are also required to explain amounts not disaggregated and define and disclose total selling expenses. The guidance is effective for fiscal years beginning after December 15, 2026, and interim periods beginning after December 15, 2027. We are currently evaluating the impact of the guidance on our financial statement disclosures.
Eaton Mobility Business
On June 10, 2026, Dana entered into definitive agreements with Eaton Corporation plc (Eaton) and certain wholly owned subsidiaries of Eaton, including Mobility (USA) Corporation (the SpinCo), to acquire Eaton’s Vehicle and eMobility business segments (Mobility business). The structure of the transaction is a Reverse Morris Trust. Following the separation of the Mobility business from Eaton, a subsidiary of SpinCo will merge with and into Dana, and Dana will survive the merger as a wholly owned subsidiary of SpinCo. Following the merger, each outstanding share of Dana will be converted into the right to receive
Note 2. Discontinued Operations
In June 2025, we entered into a definitive agreement to sell our Off-Highway business to Allison Transmission Holdings, Inc. (Allison). The transaction closed on January 1, 2026, with Dana receiving gross cash proceeds of $
Included in the gross cash proceeds received was $
At closing of the transaction, we entered into a transition services agreement, engineering services agreement, intellectual property and trademark license agreements, and certain supply agreements with Allison. Services to be provided by Dana under the transition services agreement include finance, information technology, human resources and certain other administrative services for periods up to
The major classes of line items included in net income from discontinued operations are as follows:
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Net sales | $ | $ | $ | $ | ||||||||||||
| Cost of sales | ||||||||||||||||
| Selling, general and administrative expenses | ||||||||||||||||
| Amortization of intangibles | ||||||||||||||||
| Restructuring charges, net | ( | ) | ||||||||||||||
| Gain (loss) on sale of Off-Highway business | ( | ) | ||||||||||||||
| Other income (expense), net | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Earnings (loss) from discontinued operations before interest and income taxes | ( | ) | ||||||||||||||
| Interest income | ||||||||||||||||
| Earnings (loss) from discontinued operations before income taxes | ( | ) | ||||||||||||||
| Income tax expense | ||||||||||||||||
| Net income (loss) from discontinued operations | $ | ( | ) | $ | $ | $ | ||||||||||
During the three and six months ended June 30, 2026, we incurred $
The carrying amounts of the major classes of assets and liabilities of disposal group held for sale are as follows:
| June 30, | December 31, | |||||||
| 2026 | 2025 | |||||||
| Accounts receivable - Trade | $ | $ | ||||||
| Accounts receivable - Other | ||||||||
| Inventories | ||||||||
| Other current assets | ||||||||
| Current assets of disposal group held for sale | $ | $ | ||||||
| Goodwill | $ | $ | ||||||
| Intangibles | ||||||||
| Deferred tax assets | ||||||||
| Other noncurrent assets | ||||||||
| Operating lease assets | ||||||||
| Property, plant and equipment, net | ||||||||
| Noncurrent assets of disposal group held for sale | $ | $ | ||||||
| Current portion of long-term debt | $ | $ | ||||||
| Accounts payable | ||||||||
| Accrued payroll and employee benefits | ||||||||
| Taxes on income | ||||||||
| Current portion of operating lease liabilities | ||||||||
| Other accrued liabilities | ||||||||
| Current liabilities of disposal group held for sale | $ | $ | ||||||
| Long-term debt | $ | $ | ||||||
| Noncurrent operating lease liabilities | ||||||||
| Pension and postretirement obligations | ||||||||
| Other noncurrent liabilities | ||||||||
| Noncurrent liabilities of disposal group held for sale | $ | $ | ||||||
Note 3. Intangible Assets
Components of intangible assets (excluding fully-amortized intangible assets) —
| June 30, 2026 | December 31, 2025 | |||||||||||||||||||||||||||
| Weighted Average Useful Life (years) | Gross Carrying Amount | Accumulated Impairment and Amortization | Net Carrying Amount | Gross Carrying Amount | Accumulated Impairment and Amortization | Net Carrying Amount | ||||||||||||||||||||||
| Amortizable intangible assets | ||||||||||||||||||||||||||||
| Core technology | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | ||||||||||||||||||
| Customer relationships | ( | ) | ( | ) | ||||||||||||||||||||||||
| Non-amortizable intangible assets | ||||||||||||||||||||||||||||
| Trademarks and trade names | ||||||||||||||||||||||||||||
| $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | |||||||||||||||||||
Net carrying amounts of intangible assets attributable to each of our operating segments—
| June 30, 2026 | ||||
| Light Vehicle | $ | |||
| Commercial Vehicle | ||||
| $ | ||||
Amortization expense related to amortizable intangible assets —
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Charged to cost of sales | $ | $ | $ | $ | ||||||||||||
| Charged to amortization of intangibles | ||||||||||||||||
| Total amortization | $ | $ | $ | $ | ||||||||||||
Note 4. Restructuring of Operations
Our restructuring activities include rationalizing our operating footprint by consolidating facilities, positioning operations in lower cost locations, and headcount reduction initiatives focused on reducing operating and overhead costs. Restructuring expense includes costs associated with current and previously announced actions and is comprised of contractual and noncontractual separation costs and exit costs, including certain costs of facilities that we are in the process of closing.
During 2024, we announced actions to consolidate certain manufacturing facilities along with global headcount reductions focused on reducing engineering and overhead costs in response to market dynamics, including delays in the adoption of electric vehicles. During 2026, we continued to execute on these initiatives.
Accrued restructuring costs and activity —
| Employee Termination Benefits | Exit Costs | Total | ||||||||||
| Balance, March 31, 2026 | $ | $ | $ | |||||||||
| Charges to restructuring | ||||||||||||
| Adjustments of accruals | ( | ) | ( | ) | ||||||||
| Cash payments | ( | ) | ( | ) | ( | ) | ||||||
| Currency impact | ||||||||||||
| Balance, June 30, 2026 | $ | $ | $ | |||||||||
| Balance, December 31, 2025 | $ | $ | $ | |||||||||
| Charges to restructuring | ||||||||||||
| Adjustments of accruals | ( | ) | ( | ) | ||||||||
| Cash payments | ( | ) | ( | ) | ( | ) | ||||||
| Currency impact | ||||||||||||
| Balance, June 30, 2026 | $ | $ | $ | |||||||||
At June 30, 2026, the accrued employee termination benefits include costs to reduce approximately
Note 5. Supplemental Balance Sheet and Cash Flow Information
Non-cash investing and financing activities —During the second quarter of 2026, the Company modified an operating lease, resulting in a reassessment and reclassification of the lease as a finance lease. At the modification date, the carrying amounts of the operating lease right-of-use asset and lease liability were $
Supplier finance programs — As of June 30, 2026 and December 31, 2025, we had $
Inventory components —
| June 30, 2026 | December 31, 2025 | |||||||
| Raw materials | $ | $ | ||||||
| Work in process and finished goods | ||||||||
| Total | $ | $ | ||||||
Cash, cash equivalents and restricted cash —
| June 30, 2026 | December 31, 2025 | June 30, 2025 | December 31, 2024 | |||||||||||||
| Cash and cash equivalents | $ | $ | $ | $ | ||||||||||||
| Restricted cash included in other current assets | ||||||||||||||||
| Restricted cash included in other noncurrent assets | ||||||||||||||||
| Total cash, cash equivalents and restricted cash | $ | $ | $ | $ | ||||||||||||
Mandatorily redeemable noncontrolling interest — Hydro-Québec owned a
Note 6. Stockholders’ Equity
Common stock — Our Board of Directors declared a cash dividend of twelve cents per share of common stock in the first and second quarters of 2026. Dividends accrue on restricted stock units (RSUs), performance share units (PSUs) and the Dana Transformation Awards granted under our stock compensation program and will be paid in cash or additional units when the underlying units vest.
Share repurchase program — On June 8, 2025 our Board of Directors approved a stock repurchase program of up to an aggregate of $
The Inflation Reduction Act of 2022, which was enacted into law on August 16, 2022, imposed a non-deductible 1% excise tax on the net value of certain stock repurchases made after December 31, 2022. We reflect the applicable excise tax as part of the cost basis of the stock repurchased and record a corresponding liability for the excise taxes payable in other accrued liabilities on our consolidated balance sheet. During the second quarter of 2026, we paid $
Changes in equity —
| 2026 | Common Stock | Additional Paid-In Capital | Retained Earnings | Treasury Stock | Accumulated Other Comprehensive Loss | Non-controlling Interests | Total Equity | |||||||||||||||||||||
| Balance, December 31, 2025 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | |||||||||||||||||
| Net income | ||||||||||||||||||||||||||||
| Other comprehensive income | ||||||||||||||||||||||||||||
| Common stock dividends and dividend equivalents | ( | ) | ( | ) | ||||||||||||||||||||||||
| Common stock share repurchases | ( | ) | ( | ) | ||||||||||||||||||||||||
| Distributions to noncontrolling interests | ( | ) | ( | ) | ||||||||||||||||||||||||
| Sale of noncontrolling interests | ( | ) | ( | ) | ||||||||||||||||||||||||
| Stock compensation | ||||||||||||||||||||||||||||
| Stock withheld for employee taxes | ( | ) | ( | ) | ||||||||||||||||||||||||
| Balance, March 31, 2026 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | |||||||||||||||||
| Net income | ( | ) | ||||||||||||||||||||||||||
| Other comprehensive income | ||||||||||||||||||||||||||||
| Common stock dividends and dividend equivalents | ( | ) | ( | ) | ||||||||||||||||||||||||
| Common stock share repurchases | ( | ) | ( | ) | ||||||||||||||||||||||||
| Distributions to noncontrolling interests | ( | ) | ( | ) | ||||||||||||||||||||||||
| Stock compensation | ||||||||||||||||||||||||||||
| Balance, June 30, 2026 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | |||||||||||||||||
| 2025 | Common Stock | Additional Paid-In Capital | Retained Earnings | Treasury Stock | Accumulated Other Comprehensive Loss | Non-controlling Interests | Total Equity | |||||||||||||||||||||
| Balance, December 31, 2024 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | |||||||||||||||||
| Net income | ||||||||||||||||||||||||||||
| Other comprehensive income | ||||||||||||||||||||||||||||
| Common stock dividends and dividend equivalents | ( | ) | ( | ) | ||||||||||||||||||||||||
| Distributions to noncontrolling interests | ( | ) | ( | ) | ||||||||||||||||||||||||
| Stock compensation | ||||||||||||||||||||||||||||
| Stock withheld for employee taxes | ( | ) | ( | ) | ||||||||||||||||||||||||
| Balance, March 31, 2025 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | |||||||||||||||||
| Net income | ||||||||||||||||||||||||||||
| Other comprehensive income | ||||||||||||||||||||||||||||
| Common stock dividends and dividend equivalents | ( | ) | ( | ) | ||||||||||||||||||||||||
| Distributions to noncontrolling interests | ( | ) | ( | ) | ||||||||||||||||||||||||
| Repurchase and retirement of shares | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||
| Sale of noncontrolling interests | ( | ) | ( | ) | ||||||||||||||||||||||||
| Stock compensation | ||||||||||||||||||||||||||||
| Balance, June 30, 2025 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | |||||||||||||||||
Changes in each component of accumulated other comprehensive loss (AOCI) of the parent —
| Parent Company Stockholders | ||||||||||||||||
| 2026 | Foreign Currency Translation | Hedging | Defined Benefit Plans | Accumulated Other Comprehensive Loss | ||||||||||||
| Balance, December 31, 2025 | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | ||||||
| Currency translation adjustments | ||||||||||||||||
| Currency translation adjustments realized in Off-Highway business divestiture | ||||||||||||||||
| Holding gains and losses | ||||||||||||||||
| Reclassification of amount to net income (a) | ( | ) | ( | ) | ||||||||||||
| Reclassification adjustment for net actuarial losses included in net periodic benefit cost (b) | ( | ) | ( | ) | ||||||||||||
| Tax benefit | ||||||||||||||||
| Other comprehensive income (loss) | ( | ) | ( | ) | ||||||||||||
| Balance, March 31, 2026 | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | ||||||
| Currency translation adjustments | ||||||||||||||||
| Holding gains and losses | ||||||||||||||||
| Reclassification of amount to net income (a) | ( | ) | ( | ) | ||||||||||||
| Tax benefit | ||||||||||||||||
| Other comprehensive income (loss) | ( | ) | — | |||||||||||||
| Balance, June 30, 2026 | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | ||||||
| Parent Company Stockholders | ||||||||||||||||
| 2025 | Foreign Currency Translation | Hedging | Defined Benefit Plans | Accumulated Other Comprehensive Loss | ||||||||||||
| Balance, December 31, 2024 | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Currency translation adjustments | ||||||||||||||||
| Holding gains and losses | ( | ) | ( | ) | ||||||||||||
| Reclassification of amount to net income (a) | ||||||||||||||||
| Tax expense | ( | ) | ( | ) | ||||||||||||
| Other comprehensive income | — | |||||||||||||||
| Balance, March 31, 2025 | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Currency translation adjustments | ||||||||||||||||
| Reclassification of amount to net income (a) | ||||||||||||||||
| Reclassification adjustment for net actuarial losses included in net periodic benefit cost (b) | ||||||||||||||||
| Tax expense | ( | ) | ( | ) | ( | ) | ||||||||||
| Other comprehensive income | — | |||||||||||||||
| Balance, June 30, 2025 | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | ||||||
(a) Realized gains and losses from currency-related forward contracts associated with forecasted transactions or from other derivative instruments treated as cash flow hedges are reclassified from AOCI into the same line item in the consolidated statement of operations in which the underlying forecasted transaction or other hedged item is recorded. See Note 11 for additional details.
(b) See Note 9 for additional details.
Note 7. Earnings per Share
Reconciliation of the numerators and denominators of the earnings per share calculations —
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Net income (loss) from continuing operations | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||||
| Less: Noncontrolling interests net income from continuing operations | ||||||||||||||||
| Net income (loss) from continuing operations attributable to the parent company | ( | ) | ( | ) | ( | ) | ||||||||||
| Net income (loss from discontinued operations | ( | ) | ||||||||||||||
| Net income attributable to the parent company | $ | ( | ) | $ | $ | $ | ||||||||||
| Denominator: | ||||||||||||||||
| Weighted-average common shares outstanding - Basic | ||||||||||||||||
| Employee compensation-related shares | ||||||||||||||||
| Weighted-average common shares outstanding - Diluted | ||||||||||||||||
The share count for diluted earnings per share is computed on the basis of the weighted-average number of common shares outstanding plus the effects of dilutive common stock equivalents (CSEs) outstanding during the period. We excluded
Note 8. Stock Compensation
The Compensation Committee of our Board of Directors approved the grant of RSUs, performance share units (PSUs) and Dana Transformation Awards shown in the table below during the six months ended June 30, 2026.
| Granted | Grant Date | |||||||
| (In millions) | Fair Value* | |||||||
| RSUs | $ | |||||||
| PSUs | $ | |||||||
| Dana Transformation Awards | $ | |||||||
* Weighted-average per share
Compensation expense is generally measured based on the fair value at the date of grant and is recognized on a straight-line basis over the vesting period. Awards that are settled in cash are subject to liability accounting. Accordingly, the fair value of such awards is remeasured at the end of each reporting period until settled or expired. RSUs, PSUs and the Dana Transformation Awards accrue dividends, which are subject to the same vesting and forfeiture conditions as the original award. The fair value of RSUs is based on the closing market price of our common stock at the date of grant.
The number of PSUs granted in 2026 that ultimately vest is contingent upon achieving predetermined financial performance targets. The payout is further subject to a relative total shareholder return (“TSR”) modifier which is based on specified total shareholder return targets relative to peer companies. We estimated the grant date fair value of the PSUs using various assumptions as part of a Monte Carlo simulation. The risk-free interest rate of
The Company also granted a special award tied to stock price performance (the Dana Transformation Awards). The payout is contingent upon the achievement of specified average stock price performance goals, measured over any
During the six months ended June 30, 2026, we paid $
Note 9. Pension and Postretirement Benefit Plans
We have a number of defined contribution and defined benefit, qualified and nonqualified, pension plans covering eligible employees. Other postretirement benefits (OPEB), including medical and life insurance, are provided for certain employees upon retirement.
Components of net periodic benefit cost —
| Pension | OPEB | |||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||
| Three Months Ended June 30, | U.S. | Non-U.S. | U.S. | Non-U.S. | Non-U.S. | Non-U.S. | ||||||||||||||||||
| Interest cost | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
| Expected return on plan assets | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
| Service cost | ||||||||||||||||||||||||
| Amortization of net actuarial loss (gain) | ( | ) | ||||||||||||||||||||||
| Net periodic benefit cost (credit) | $ | ( | ) | $ | $ | $ | $ | $ | ( | ) | ||||||||||||||
| Six Months Ended June 30, | ||||||||||||||||||||||||
| Interest cost | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
| Expected return on plan assets | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||
| Service cost | ||||||||||||||||||||||||
| Amortization of net actuarial loss (gain) | ( | ) | ( | ) | ||||||||||||||||||||
| Net periodic benefit cost (credit) | $ | ( | ) | $ | $ | $ | $ | $ | ( | ) | ||||||||||||||
The service cost components of net periodic pension and OPEB costs are included in cost of sales and selling, general and administrative expenses as part of compensation cost and are eligible for capitalization in inventory and other assets. The non-service components are reported in other income (expense), net and are not eligible for capitalization.
Note 10. Financing Agreements
Long-term debt at —
| Interest Rate | June 30, 2026 | December 31, 2025 | ||||||||||
| Senior Notes due November 15, 2027 | % | $ | $ | |||||||||
| Senior Notes due June 15, 2028 | % | |||||||||||
| Senior Euro Notes due July 15, 2029 | % | |||||||||||
| Senior Notes due September 1, 2030 | % | |||||||||||
| Senior Euro Notes due July 15, 2031 | % | |||||||||||
| Senior Notes due February 15, 2032 | % | |||||||||||
| Other indebtedness | ||||||||||||
| Debt issuance costs | ( | ) | ( | ) | ||||||||
| Less: Current portion of long-term debt | ||||||||||||
| Long-term debt, less debt issuance costs | $ | $ | ||||||||||
Interest on the senior notes is payable semi-annually. Other indebtedness includes borrowings from various financial institutions and finance lease obligations.
Senior notes activity — On April 15, 2025, Dana retired its remaining April 2025 Notes. On December 4, 2025, we offered as part of a net proceeds tender offer to purchase at a price equal to
Senior notes redemption provisions — We may redeem some or all of the senior notes at the following redemption prices (expressed as percentages of principal amount), plus accrued and unpaid interest to the redemption date, if redeemed during the 12-month period commencing on the anniversary date of the senior notes in the year set forth below:
| Redemption Price | ||||||||||||||||
| July | September | July | February | |||||||||||||
| Year | 2029 Notes | 2030 Notes | 2031 Notes | 2032 Notes | ||||||||||||
| 2025 | % | |||||||||||||||
| 2026 | % | % | % | |||||||||||||
| 2027 | % | % | % | % | ||||||||||||
| 2028 | % | % | % | % | ||||||||||||
| 2029 | % | % | % | |||||||||||||
| 2030 | % | % | ||||||||||||||
| 2031 | % | |||||||||||||||
At any time prior to July 15, 2026, we may redeem up to 40% of the aggregate principal amount of the July 2031 Notes in an amount not to exceed the amount of proceeds of one or more equity offerings, at a price equal to
Prior to February 15, 2027, we may redeem some or all of the February 2032 Notes at a redemption price equal to
Credit agreement — On July 31, 2025, we amended our credit and guaranty agreement to include a $
Deferred financing costs on our Revolving Facility are included in other noncurrent assets and are being amortized over the life of the Revolving Facility. Each the Revolving Facility and Term A Facility is guaranteed by all of our wholly-owned domestic subsidiaries subject to certain exceptions (the guarantors) and is secured by a first-priority lien on substantially all of the assets of Dana and the guarantors, subject to certain exceptions.
Advances under the Revolving Facility bear interest at a floating rate based on, at our option, the base rate or the SOFR (each as described in the credit agreement) plus a margin as set forth below:
| Margin | ||||||||
| Total Net Leverage Ratio | Base Rate | SOFR Rate | ||||||
| Less than or equal to 1.00:1.00 | % | % | ||||||
| Greater than 1.00:1.00 but less than or equal to 2.00:1.00 | % | % | ||||||
| Greater than 2.00:1.00 | % | % | ||||||
Commitment fees are applied based on the average daily unused portion of the available amounts under the Revolving Facility as set forth below:
| Total Net Leverage Ratio | Commitment Fee | |||
| Less than or equal to 1.00:1.00 | % | |||
| Greater than 1.00:1.00 but less than or equal to 2.00:1.00 | % | |||
| Greater than 2.00:1.00 | % | |||
Up to $
At June 30, 2026, there were
Debt covenants — At June 30, 2026, we were in compliance with the covenants of our financing agreements. Under the Revolving Facility and the senior notes, we are required to comply with certain incurrence-based covenants customary for facilities of these types and, in the case of the Revolving Facility, a maintenance covenant tested on the last day of each fiscal quarter requiring us to maintain a first lien net leverage ratio not to exceed
Bridge facility — On June 10, 2026, we became a party to a $
Subsequent events — On July 1, 2026, we issued notices of conditional full redemption with a redemption date of July 31, 2026, for all of our outstanding July 2031 Notes at a redemption price equal to
On July 2, 2026, we became a party to a $
Note 11. Fair Value Measurements and Derivatives
In measuring the fair value of our assets and liabilities, we use market data or assumptions that we believe market participants would use in pricing an asset or liability including assumptions about risk when appropriate. Our valuation techniques include a combination of observable and unobservable inputs.
Fair value measurements on a recurring basis — Assets and liabilities that are carried in our balance sheets at fair value are as follows:
| Fair Value | |||||||||||||
| Category | Balance Sheet Location | Fair Value Level | June 30, 2026 | December 31, 2025 | |||||||||
| Currency forward contracts | |||||||||||||
| Cash flow hedges | Accounts receivable - Other | 2 | $ | $ | |||||||||
| Cash flow hedges | Other accrued liabilities | 2 | |||||||||||
| Undesignated | Accounts receivable - Other | 2 | |||||||||||
| Undesignated | Other accrued liabilities | 2 | |||||||||||
| Currency swaps | |||||||||||||
| Cash flow hedges | Other noncurrent liabilities | 2 | |||||||||||
| Undesignated | Other noncurrent liabilities | 2 | |||||||||||
Fair Value Level 2 assets and liabilities reflect the use of significant other observable inputs.
Fair value of financial instruments — The financial instruments that are not carried in our balance sheets at fair value are as follows:
| June 30, 2026 | December 31, 2025 | |||||||||||||||||||
| Fair Value Level | Carrying Value | Fair Value | Carrying Value | Fair Value | ||||||||||||||||
| Long-term debt | 2 | $ | $ | $ | $ | |||||||||||||||
Foreign currency derivatives — Our foreign currency derivatives include forward contracts associated with forecasted transactions, primarily involving the purchases and sales of inventory, as well as currency swaps associated with certain recorded external notes payable and intercompany loans receivable and payable. Periodically, our foreign currency derivatives also include net investment hedges of certain of our investments in foreign operations.
We have executed fixed-to-fixed cross-currency swaps in conjunction with the issuance of certain notes to eliminate the variability in the functional-currency-equivalent cash flows due to changes in exchange rates associated with the forecasted principal and interest payments. All of the underlying designated financial instruments have been designated as the hedged items in each respective cash flow hedge relationship, as shown in the table below. Designated as cash flow hedges of the forecasted principal and interest payments of the underlying designated financial instruments, all of the swaps economically convert the underlying designated financial instruments into the functional currency of each respective holder. The impact of the interest rate differential between the inflow and outflow rates on fixed-to-fixed cross-currency swaps is recognized during each period as a component of interest expense for hedges of external debt and as a component of other income (expense), net for hedges of intercompany debt.
The following fixed-to-fixed cross-currency swaps were outstanding at June 30, 2026:
| Underlying Financial Instrument | Derivative Financial Instrument | |||||||||||||||||||||||||
| Description | Type | Face Amount | Rate | Notional Amount | Traded Amount | Inflow Rate | Outflow Rate | |||||||||||||||||||
| Luxembourg Intercompany Notes | Receivable | € | % | € | $ | % | % | |||||||||||||||||||
The designated swaps are expected to be highly effective in offsetting the corresponding currency-based changes in cash outflows related to the underlying designated financial instruments. Based on our qualitative assessment that the critical terms of the underlying designated financial instruments and the associated swaps match and that all other required criteria have been met, we do not expect to incur any ineffectiveness. As effective cash flow hedges, changes in the fair value of the swaps will be recorded in OCI during each period. Additionally, to the extent the swaps remain effective, the appropriate portion of AOCI will be reclassified to earnings each period as an offset to the foreign exchange gain or loss resulting from the remeasurement of the underlying designated financial instruments. To the extent the swaps are no longer effective, changes in their fair values will be recorded in earnings.
The total notional amount of outstanding foreign currency forward contracts, involving the exchange of various currencies, was $
The following currency derivatives were outstanding at June 30, 2026:
| Notional Amount (U.S. Dollar Equivalent) | ||||||||||||||||
| Functional Currency | Traded Currency | Designated | Undesignated | Total | Maturity | |||||||||||
| U.S. dollar | Canadian dollar, Mexican peso | $ | $ | $ | Mar-2027 | |||||||||||
| Euro | U.S. dollar, Australian dollar, British pound, Hungarian forint, Mexican peso, Swedish krona | Sep-2027 | ||||||||||||||
| Indian rupee | U.S. dollar, euro, British pound | Mar-2027 | ||||||||||||||
| Brazilian real | U.S. dollar, euro | Dec-2026 | ||||||||||||||
| South African rand | U.S. dollar, euro, Thai baht | Nov-2026 | ||||||||||||||
| Canadian dollar | U.S. dollar | Aug-2026 | ||||||||||||||
| Thai baht | U.S. dollar | Jul-2026 | ||||||||||||||
| British pound | U.S. dollar, euro | Sep-2026 | ||||||||||||||
| Mexican peso | U.S. dollar | Jul-2026 | ||||||||||||||
| Swedish krona | euro | Jul-2026 | ||||||||||||||
| Total forward contracts | ||||||||||||||||
| U.S. dollar | euro | Nov-2027 | ||||||||||||||
| Total currency swaps | ||||||||||||||||
| Total currency derivatives | $ | $ | $ | |||||||||||||
Designated cash flow hedges — With respect to contracts designated as cash flow hedges, changes in fair value during the period in which the contracts remain outstanding are reported in OCI to the extent such contracts remain effective. Effectiveness is measured by using regression analysis to determine the degree of correlation between the change in the fair value of the derivative instrument and the change in the associated foreign currency exchange rates. Changes in the fair value of contracts not designated as cash flow hedges or as net investment hedges are recognized in other income (expense), net in the period in which the changes occur. Realized gains and losses from currency-related forward contracts associated with forecasted transactions or from other derivative instruments, including those that have been designated as cash flow hedges and those that have not been designated, are recognized in the same line item in the consolidated statement of operations in which the underlying forecasted transaction or other hedged item is recorded. Accordingly, amounts are potentially recorded in sales, cost of sales or, in certain circumstances, other income (expense), net.
The following table provides a summary of deferred gains (losses) reported in AOCI as well as the amount expected to be reclassified to income in one year or less:
| Deferred Gain (Loss) in AOCI | ||||||||||||
| June 30, 2026 | December 31, 2025 | Gain (loss) expected to be reclassified into income in one year or less | ||||||||||
| Forward Contracts | $ | $ | $ | |||||||||
| Cross-Currency Swaps | ||||||||||||
| Total | $ | $ | $ | |||||||||
The following table provides a summary of the location and amount of gains or losses recognized in the consolidated statement of operations associated with cash flow hedging relationships:
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| Derivatives Designated as Cash Flow Hedges | 2026 | 2025 | 2026 | 2025 | ||||||||||||
| Total amounts of income and expense line items presented in the consolidated statement of operations in which the effects of cash flow hedges are recorded | ||||||||||||||||
| Net sales | $ | $ | $ | $ | ||||||||||||
| Cost of sales | ||||||||||||||||
| Other income (expense), net | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| (Gain) or loss on cash flow hedging relationships | ||||||||||||||||
| Foreign currency forwards | ||||||||||||||||
| Amount of (gain) loss reclassified from AOCI into income | ||||||||||||||||
| Cost of sales | ( | ) | ( | ) | ||||||||||||
| Other income (expense), net | ( | ) | ( | ) | ( | ) | ||||||||||
| Cross-currency swaps | ||||||||||||||||
| Amount of (gain) loss reclassified from AOCI into income | ||||||||||||||||
| Other income (expense), net | ( | ) | ( | ) | ||||||||||||
The amounts reclassified from AOCI into income for the cross-currency swaps represent an offset to a foreign exchange loss on our foreign currency-denominated intercompany and external debt instruments.
Certain of our hedges of forecasted transactions have not formally been designated as cash flow hedges. As undesignated forward contracts, the changes in the fair value of such contracts are included in earnings for the duration of the outstanding forward contract. Any realized gain or loss on the settlement of such contracts is recognized in the same period and in the same line item in the consolidated statement of operations as the underlying transaction. The following table provides a summary of the location and amount of gains or losses recognized in the consolidated statement of operations associated with undesignated hedging relationships.
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| Derivatives Not Designated as Hedging Instruments | 2026 | 2025 | 2026 | 2025 | ||||||||||||
| Gain (loss) recognized in income | ||||||||||||||||
| Foreign currency forward contracts | ||||||||||||||||
| Cost of sales | $ | $ | $ | $ | ||||||||||||
| Other income (expense), net | ( | ) | ( | ) | ( | ) | ||||||||||
Net investment hedges — We periodically designate derivative contracts or underlying non-derivative financial instruments as net investment hedges. With respect to contracts designated as net investment hedges, we apply the forward method, but for non-derivative financial instruments designated as net investment hedges, we apply the spot method. Under both methods, we report changes in fair value in the cumulative translation adjustment (CTA) component of OCI during the period in which the contracts remain outstanding to the extent such contracts and non-derivative financial instruments remain effective. During the second quarter of 2024, we entered into foreign currency forwards with a notional value of $
Note 12. Commitments and Contingencies
Environmental liabilities — Accrued environmental liabilities were $
Other legal matters — We are subject to various pending or threatened legal proceedings arising out of the normal course of business or operations. In view of the inherent difficulty of predicting the outcome of such matters, we cannot state the eventual outcome of these matters. However, based on current knowledge and after consultation with legal counsel, we believe that any liabilities that may result from these proceedings will not have a material adverse effect on our liquidity, financial condition or results of operations.
Tariffs — In February 2026, the U.S. Supreme Court issued a ruling invalidating certain tariffs previously imposed under the International Emergency Economic Powers Act (IEEPA). The U.S. Court of International Trade (CIT) has ordered the U.S. Customs and Border Protection (CBP) to refund the collected IEEPA tariffs. During the second quarter of 2026, we filed for refunds of previously paid tariffs assessed under IEEPA in an aggregate amount of $
Note 13. Warranty Obligations
We record a liability for estimated warranty obligations at the dates our products are sold. We record the liability based on our estimate of costs to settle future claims. Adjustments to our estimated costs at time of sale are made as claim experience and other new information becomes available. Obligations for service campaigns and other occurrences are recognized as adjustments to prior estimates when the obligation is probable and can be reasonably estimated.
Changes in warranty liabilities —
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Balance, beginning of period | $ | $ | $ | $ | ||||||||||||
| Amounts accrued for current period sales | ||||||||||||||||
| Adjustments of prior estimates | ||||||||||||||||
| Settlements of warranty claims | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Currency impact | ||||||||||||||||
| Balance, end of period | $ | $ | $ | $ | ||||||||||||
Note 14. Income Taxes
We estimate the effective tax rate expected to be applicable for the full fiscal year and use that rate to provide for income taxes in interim reporting periods. We also recognize the tax impact of certain unusual or infrequently occurring items, including changes in judgment about valuation allowances and effects of changes in tax laws or rates, in the interim period in which they occur.
We have generally not recognized tax benefits on losses generated in several entities where the recent history of operating losses does not allow us to satisfy the “more likely than not” criterion for the recognition of deferred tax assets. Consequently, there is no income tax expense or benefit recognized on the pre-tax income or losses in these jurisdictions as valuation allowances are adjusted to offset the associated tax expense or benefit.
We record interest and penalties related to uncertain tax positions as a component of income tax expense. Net interest expense for the periods presented herein is not significant.
We reported income tax expense of $
On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was enacted in the U.S. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the 2017 Tax Cuts and Jobs Act, modifications to the international tax framework, and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The Company has evaluated the provisions of the Act and reflected the impact during the appropriate period. The Company will continue to evaluate the impact of these legislative changes as more guidance becomes available.
Note 15. Other Income (Expense), Net
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Non-service cost components of pension and OPEB costs | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Government assistance | ||||||||||||||||
| Foreign exchange gain (loss) | ( | ) | ( | ) | ( | ) | ||||||||||
| Strategic transaction expenses | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Gain on sale of property, plant and equipment | ||||||||||||||||
| Electric vehicle program termination charges | ( | ) | ( | ) | ||||||||||||
| Loss on divestiture of ownership interests | ( | ) | ( | ) | ( | ) | ||||||||||
| Transition services income | ||||||||||||||||
| Other, net | ||||||||||||||||
| Other income (expense), net | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
Foreign exchange gains and losses on cross-currency intercompany loan balances that are not of a long-term investment nature are included above. Foreign exchange gains and losses on intercompany loans that are permanently invested are reported in OCI.
Strategic transaction expenses relate primarily to costs incurred in connection with acquisition and divestiture related activities, including costs to complete the transaction and post-closing integration costs, and other strategic initiatives. Strategic transaction expenses in 2026 were primarily attributable to the potential acquisition of Eaton's Mobility business. See Note 1 for additional information.
During the first six months of 2026, we recorded $
On January 1, 2026, we sold our Off-Highway business to Allison. At closing, Dana entered into a transition services agreement and an engineering services agreement with Allison. Services to be provided by Dana under the transition services agreement include finance, information technology, human resources and certain other administrative services for periods up to
On January 30, 2026, we sold our wholly-owned subsidiary Pi Innovo LLC, recognizing a $
On June 6, 2025, we sold our ownership interest in Switch Mobility Limited, recognizing an $
Note 16. Revenue from Contracts with Customers
We generate revenue from selling production parts to original equipment manufacturers (OEMs) and service parts to OEMs and aftermarket customers. While we provide production and service parts to certain OEMs under awarded multi-year programs, these multi-year programs do not contain any commitment to volume by the customer. As such, individual customer releases or purchase orders represent the contract with the customer. Our customer contracts do not provide us with an enforceable right to payment for performance completed to date throughout the contract term. As such, we recognize part sales revenue at the point in time when the parts are shipped, and risk of loss has transferred to the customer. We have elected to continue to include shipping and handling fees billed to customers in revenue, while including costs of shipping and handling in costs of sales. Taxes collected from customers are excluded from revenues and credited directly to obligations to the appropriate government agencies. Payment terms with our customers are established based on industry and regional practices and generally do not exceed
We continually seek new business opportunities and at times provide incentives to our customers for new program awards. We evaluate the underlying economics of each payment made to our customers to determine the proper accounting by understanding the nature of the payment, the rights and obligations in the contract, and other relevant facts and circumstances. Upfront payments to our customers are capitalized if we determine that the payments are incremental and incurred only if the new business is obtained and we expect to recover these amounts from the customer over the term of the new business program. We recognize a reduction to revenue as products that the upfront payments are related to are transferred to the customer, based on the total amount of products expected to be sold over the term of the program. We evaluate the amounts capitalized each period for recoverability and expense any amounts that are no longer expected to be recovered. We had $
Certain of our customer contracts include rebate incentives. We estimate expected rebates and accrue the corresponding refund liability, as a reduction of revenue, at the time covered product is sold to the customer based on anticipated customer purchases during the rebate period and contractual rebate percentages. Refund liabilities are included in other accrued liabilities on our consolidated balance sheets. We provide standard fitness for use warranties on the products we sell, accruing for estimated costs related to product warranty obligations at time of sale. See Note 13 for additional information.
Contract liabilities are primarily comprised of cash deposits made by customers with cash in advance payment terms, upfront payments from customers related to multi-year programs and unapplied Section 232 tariff credits allocated to Dana by its U.S. OEM customers. We had $
Disaggregation of revenue —
The following table disaggregates revenue for each of our operating segments by geographical market:
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Light Vehicle | ||||||||||||||||
| North America | $ | $ | $ | $ | ||||||||||||
| Europe | ||||||||||||||||
| South America | ||||||||||||||||
| Asia Pacific | ||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||
| Commercial Vehicle | ||||||||||||||||
| North America | $ | $ | $ | $ | ||||||||||||
| Europe | ||||||||||||||||
| South America | ||||||||||||||||
| Asia Pacific | ||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||
| Total | ||||||||||||||||
| North America | $ | $ | $ | $ | ||||||||||||
| Europe | ||||||||||||||||
| South America | ||||||||||||||||
| Asia Pacific | ||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||
Note 17. Segments
We are a global provider of high-technology products to virtually every major on-highway vehicle manufacturer in the world. Our technologies include drive systems (axles, driveshafts and transmissions); electrodynamic technologies (motors, inverters, software and control systems, battery-management systems, and fuel cell plates); sealing solutions (gaskets, seals, cam covers, and oil pan modules); thermal-management technologies (transmission and engine oil cooling, battery and electronics cooling, charge air cooling, and thermal-acoustical protective shielding); and digital solutions (active and passive system controls and descriptive and predictive analytics). Effective January 1, 2025, Dana’s chief operating decision maker (CODM) realigned Dana’s operating segments, reflecting Dana’s commitment to streamlining the business, enhancing our go-to market approach, and serving our customers more efficiently. Our former Power Technologies operating segment has been split, integrating the OEM-facing business into our Light Vehicle Systems operating segment and integrating the aftermarket business into our Commercial Vehicle Systems operating segment. In addition, in June 2025 we entered into a definitive agreement to sell our Off-Highway business to Allison Transmission Holdings, Inc. See Note 2 for additional information. Certain operations that fell outside of the sale perimeter, including certain Dana TM4 operations and our European hydraulics business, have been integrated into our Commercial Vehicle Systems and Light Vehicle Systems operating segments, respectively. We now serve our global light vehicle and medium/heavy vehicle markets through
Dana evaluates the performance of its operating segments based on external sales and segment EBITDA. Segment EBITDA is a primary driver of cash flows from operations and a measure of our ability to maintain and continue to invest in our operations and provide shareholder returns. Our segments are charged for corporate and other shared administrative costs. Certain corporate and other administrative costs that were historically charged to our Off-Highway business, that are not permitted to be reflected as part of discontinued operations, have been recast and are included within the "corporate expense and other items, net" line of the reconciliation of segment EBITDA to earnings (loss) from continuing operations before income taxes. Segment EBITDA may not be comparable to similarly titled measures reported by other companies.
Segment information —
| Light | Commercial | |||||||||||||||
| Three months ended June 30, 2026 | Vehicle | Vehicle | Corporate | Total | ||||||||||||
| External sales | $ | $ | $ | |||||||||||||
| Inter-segment sales | ||||||||||||||||
| Reconciliation of sales | ||||||||||||||||
| Elimination of inter-segment sales | ( | ) | ||||||||||||||
| Total consolidated sales | $ | |||||||||||||||
| Less: | ||||||||||||||||
| Cost of sales | ||||||||||||||||
| Selling, general and administrative expenses | ||||||||||||||||
| Other segment items (a) | ( | ) | ( | ) | ||||||||||||
| Segment EBITDA | $ | $ | $ | |||||||||||||
| Purchases of property, plant and equipment | $ | $ | $ | $ | ||||||||||||
| Segment net assets (b) - June 30, 2026 | $ | $ | $ | ( | ) | $ | ||||||||||
| Light | Commercial | |||||||||||||||
| Three months ended June 30, 2025 | Vehicle | Vehicle | Corporate | Total | ||||||||||||
| External sales | $ | $ | $ | |||||||||||||
| Inter-segment sales | ||||||||||||||||
| Reconciliation of sales | ||||||||||||||||
| Elimination of inter-segment sales | ( | ) | ||||||||||||||
| Total consolidated sales | $ | |||||||||||||||
| Less: | ||||||||||||||||
| Cost of sales | ||||||||||||||||
| Selling, general and administrative expenses | ||||||||||||||||
| Other segment items (a) | ( | ) | ||||||||||||||
| Segment EBITDA | $ | $ | $ | |||||||||||||
| Purchases of property, plant and equipment | $ | $ | $ | $ | ||||||||||||
| Segment net assets (b) - December 31, 2025 | $ | $ | $ | ( | ) | $ | ||||||||||
| Light | Commercial | |||||||||||||||
| Six months ended June 30, 2026 | Vehicle | Vehicle | Corporate | Total | ||||||||||||
| External sales | $ | $ | $ | |||||||||||||
| Inter-segment sales | ||||||||||||||||
| Reconciliation of sales | ||||||||||||||||
| Elimination of inter-segment sales | ( | ) | ||||||||||||||
| Total consolidated sales | $ | |||||||||||||||
| Less: | ||||||||||||||||
| Cost of sales | ||||||||||||||||
| Selling, general and administrative expenses | ||||||||||||||||
| Other segment items (a) | ( | ) | ( | ) | ||||||||||||
| Segment EBITDA | $ | $ | $ | |||||||||||||
| Purchases of property, plant and equipment | $ | $ | $ | $ | ||||||||||||
| Light | Commercial | |||||||||||||||
| Six months ended June 30, 2025 | Vehicle | Vehicle | Corporate | Total | ||||||||||||
| External sales | $ | $ | $ | |||||||||||||
| Inter-segment sales | ||||||||||||||||
| Reconciliation of sales | ||||||||||||||||
| Elimination of inter-segment sales | ( | ) | ||||||||||||||
| Total consolidated sales | $ | |||||||||||||||
| Less: | ||||||||||||||||
| Cost of sales | ||||||||||||||||
| Selling, general and administrative expenses | ||||||||||||||||
| Other segment items (a) | ( | ) | ||||||||||||||
| Segment EBITDA | $ | $ | $ | |||||||||||||
| Purchases of property, plant and equipment | $ | $ | $ | $ | ||||||||||||
(a) Other segment items primarily include foreign exchange gains and losses, government assistance and export incentives.
(b) Segment net assets include accounts receivable - trade, inventories and accounts payable.
Reconciliation of segment EBITDA to loss from continuing operations before income taxes —
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Segment EBITDA | $ | $ | $ | $ | ||||||||||||
| Corporate expense and other items, net | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Depreciation | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Amortization | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Non-service cost components of pension and OPEB costs | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Restructuring charges, net | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Stock compensation expense | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Strategic transaction expenses | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Gain on sale of property, plant and equipment | ||||||||||||||||
| Supplier capacity charge adjustment | ||||||||||||||||
| Amounts attributable to previously closed/divested operations | ( | ) | ( | ) | ||||||||||||
| Distressed supplier costs | ( | ) | ( | ) | ||||||||||||
| Loss on divestiture of ownership interests | ( | ) | ( | ) | ( | ) | ||||||||||
| Electric vehicle program termination charges | ( | ) | ( | ) | ||||||||||||
| Foreign exchange gain on unhedged intercompany loans | ||||||||||||||||
| Other items | ( | ) | ( | ) | ( | ) | ||||||||||
| Earnings from continuing operations before interest and income taxes | ||||||||||||||||
| Loss on extinguishment of debt | ( | ) | ||||||||||||||
| Interest income | ||||||||||||||||
| Interest expense | ||||||||||||||||
| Earnings (loss) from continuing operations before income taxes | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
Reconciliation of segment net assets to consolidated total assets —
| June 30, | December 31, | |||||||
| 2026 | 2025 | |||||||
| Segment net assets | $ | $ | ||||||
| Accounts payable | ||||||||
| Cash and cash equivalents | ||||||||
| Accounts receivable - Other | ||||||||
| Other current assets | ||||||||
| Current assets of disposal group held for sale | ||||||||
| Intangibles | ||||||||
| Deferred tax assets | ||||||||
| Other noncurrent assets | ||||||||
| Investment in affiliates | ||||||||
| Operating lease assets | ||||||||
| Property, plant and equipment, net | ||||||||
| Noncurrent assets of disposal group held for sale | ||||||||
| Total assets | $ | $ | ||||||
Note 18. Equity Affiliates
We have a number of investments in entities that engage in the manufacture and supply of vehicular parts (primarily axles and driveshafts).
Equity method investments at June 30, 2026 —
| Ownership Percentage | Investment | |||||
| Dongfeng Dana Axle Co., Ltd. | $ | |||||
| ROC-Spicer, Ltd. | ||||||
| Tai Ya Investment (HK) Co., Limited | ||||||
| All others as a group | ||||||
| Investments in equity affiliates | ||||||
| Investments in affiliates carried at cost | ||||||
| Investments in affiliates | $ | |||||
On April 25, 2025, we sold our
On June 6, 2025, we sold our ownership interest in Switch Mobility Limited for $
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Dollars in millions)
Management's discussion and analysis of financial condition and results of operations should be read in conjunction with the financial statements and accompanying notes in this report.
Forward-Looking Information
Statements in this report (or otherwise made by us or on our behalf) that are not entirely historical constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements can often be identified by words such as “anticipates,” “expects,” “believes,” “intends,” “plans,” “predicts,” “seeks,” “estimates,” “projects,” “outlook,” “may,” “will,” “should,” “would,” “could,” “potential,” “continue,” “ongoing” and similar expressions, variations or negatives of these words. These statements represent the present expectations of Dana Incorporated and its consolidated subsidiaries (Dana) based on our current information and assumptions. Forward-looking statements are inherently subject to risks and uncertainties. Our plans, actions and actual results could differ materially from our present expectations due to a number of factors, including those discussed below and elsewhere in this report and in our other filings with the Securities and Exchange Commission (SEC). All forward-looking statements speak only as of the date made and we undertake no obligation to publicly update or revise any forward-looking statement to reflect events or circumstances that may arise after the date of this report.
Recent Strategic Actions
Cost reduction initiatives — During the fourth quarter of 2024, we announced further actions to support sustained long-term profitability and enhanced cash flow generation. This includes substantial reduction in selling, general and administrative costs and aligning engineering expenses to match current industry dynamics, including the ongoing delay in the adoption of electric vehicles. We expect to deliver annualized savings of $325 through 2026. Approximately $260 of annualized savings was realized through 2025 with an additional $65 to be realized in 2026. See Note 4 of our consolidated financial statements in Item 1 of Part I for additional information.
Segment realignment — Through December 2024, we managed our operations globally through four operating segments. Our Light Vehicle and Power Technologies segments primarily supported light vehicle original equipment manufacturers (OEMs) with products for light trucks, SUVs, CUVs, vans and passenger cars. Our Commercial Vehicles segment supported the OEMs of on-highway commercial vehicles (primarily trucks and buses), while our Off-Highway segment supported OEMs of off-highway vehicles (primarily wheeled vehicles used in construction, mining and agricultural applications). In the first quarter of 2025, our Power Technologies segment was integrated into our Light Vehicle and Commercial Vehicle segments, streamlining the business, enhancing our go-to-market approach and serving our customers more efficiently. The OEM-facing business was integrated into our Light Vehicle segment while the aftermarket business was integrated into our Commercial Vehicle segment. See Note 17 of our consolidated financial statements in Item 1 of Part I for additional information.
Divestiture of Off-Highway Business — Dana has embarked on a strategic plan to focus on our core on-highway markets, creating a more focused and nimble Dana through the divestiture of our Off-Highway business. In June 2025, we entered into a definitive agreement to sell our Off-Highway business to Allison Transmission Holdings, Inc. We analyzed the quantitative and qualitative factors relevant to the divestiture of our Off-Highway business and determined that the conditions for discontinued operations presentation had been met. As such, the financial position, results of operations and cash flows of that business are reported as discontinued operations in the accompanying consolidated financial statements. Prior period amounts have been recast to reflect discontinued operations presentation. The transaction closed on January 1, 2026, with Dana receiving cash proceeds of $2,630. See Note 1 and Note 2 of our consolidated financial statements in Item 1 of Part I for additional information.
Capital Structure Initiatives — Net cash proceeds from the Off-Highway business divestiture were used to pay down debt, strengthening Dana’s financial position, and provide capital returns to shareholders. On January 7, 2026, we purchased, via a net proceeds tender offer, $138 of our November 2027 Notes, $142 of our June 2028 Notes, €141 of our July 2029 Notes ($164 as of January 7, 2026), $173 of our September 2030 Notes, €9 of our July 2031 Notes ($10 as of January 7, 2026) and $152 of our February 2032 Notes at prices equal to 100.00% plus accrued and unpaid interest. On January 8, 2026, we redeemed the remaining $262 of our November 2027 Notes and the remaining $258 of our June 2028 Notes at prices equal to 100.00% plus accrued and unpaid interest. In addition, on January 2, 2026, we repaid the $225 outstanding balance on the Term A Facility and the $390 of outstanding borrowings on our Revolving Facility. See Note 10 of our consolidated financial statements in Item 1 of Part I for additional information. On June 8, 2025, Dana’s board of directors approved a program to provide up to a $1,000 return of capital to shareholders through common stock share repurchases and/or special dividends through the end of 2027. On February 11, 2026, Dana's board of directors increased and extended the share repurchase program to a total of $2,000 through the end of 2030. Through June 30, 2026, we have spent $819 to repurchase 39,943,730 shares under the approved stock repurchase program. See Note 6 of our consolidated financial statements in Item 1 of Part I for additional information.
Other Initiatives
Aftermarket opportunities — We have a global group dedicated to identifying and developing aftermarket growth opportunities that leverage the capabilities within our existing businesses – targeting increased future aftermarket sales. Powered by recognized brands such as Dana®, Spicer®, Spicer Electrified™, Victor Reinz®, Glaser®, GWB®, Thompson®, Tru-Cool®, SVL®, and Transejes™, Dana delivers a broad range of aftermarket solutions – including genuine, all makes, and value lines – servicing passenger and commercial vehicles across the globe.
Selective acquisitions — Although transformational opportunities will be considered when strategically and economically attractive, our acquisition focus is principally directed at “bolt-on” or adjacent acquisition opportunities that have a strategic fit with our existing core businesses, particularly opportunities that support our enterprise strategy and enhance the value proposition of our product offerings. Any potential acquisition will be evaluated in the same manner we currently consider customer program opportunities and other uses of capital – with a disciplined financial approach designed to ensure profitable growth and increased shareholder value.
Eaton Mobility Business — On June 10, 2026, Dana entered into definitive agreements with Eaton Corporation plc (Eaton) and certain wholly owned subsidiaries of Eaton, including Mobility (USA) Corporation (the SpinCo), to acquire Eaton’s Vehicle and eMobility business segments (Mobility business). The structure of the transaction is a Reverse Morris Trust. Following the separation of the Mobility business from Eaton, a subsidiary of SpinCo will merge with and into Dana, and Dana will survive the merger as a wholly owned subsidiary of SpinCo. Following the merger, each outstanding share of Dana will be converted into the right to receive one SpinCo share. Prior to or at the closing, a subsidiary of Eaton will sell to Dana 100% of the stock in Royal Precision Holdings Corp. in exchange for cash consideration (the Royal Precision Purchase Price). In the event of an election by Dana, certain specified assets (as defined in the separation agreement) will be purchased by Dana from Eaton and certain of its subsidiaries. When the transaction is completed, former Eaton shareholders will own at least 50.1% and former Dana shareholders will own no more than 49.9% of the outstanding shares of SpinCo common stock on a fully diluted basis. Under the terms of the agreement, Eaton will receive a cash distribution of approximately $1,100, subject to adjustment for cash and indebtedness and reduced by the Royal Precision and other specified assets Purchase Price. The transaction has been unanimously approved by the Boards of Directors of both Dana and Eaton. No vote by Eaton shareholders is required. The transaction is intended to be tax-free to Dana and Eaton shareholders for U.S. federal income tax purposes. The transaction is anticipated to close in the first quarter of 2027, subject to approval by Dana's shareholders and customary closing conditions, including receipt of regulatory approvals. The agreements contain certain customary termination rights for Dana and Eaton, including, without limitation, a right for either party to terminate if the transaction is not completed on or before June 10, 2027. Termination resulting from Dana shareholders voting against the transaction would result in Dana having to reimburse Eaton for certain expenses in an amount not to exceed $20. Termination under specified circumstances would require Dana to pay Eaton a termination fee of $159. In anticipation of the transaction, Mobility (USA) Corporation and Dana became parties to a $2,600 bridge facility, a $350 secured term loan A commitment and a $1,200 secured revolving credit facility commitment. See Note 10 of our consolidated financial statements in Item 1 of Part I for additional information.
Management Overview
Dana, with history dating back to 1904, is headquartered in Maumee, Ohio. We are a world leader in providing power-conveyance and energy-management solutions for on-highway vehicles. The company's portfolio improves the efficiency, performance, and sustainability of light and commercial vehicles. Our technologies include drive systems (axles, driveshafts and transmissions); electrodynamic technologies (motors, inverters, software and control systems, battery-management systems, and fuel cell plates); sealing solutions (gaskets, seals, cam covers, and oil pan modules); thermal-management technologies (transmission and engine oil cooling, battery and electronics cooling, charge air cooling, and thermal-acoustical protective shielding); and digital solutions (active and passive system controls and descriptive and predictive analytics). We serve our global light vehicle and medium/heavy vehicle markets through two business units – Light Vehicle Systems (Light Vehicle) and Commercial Vehicle Systems (Commercial Vehicle). At June 30, 2026, we employed approximately 27,300 people and operated in 24 countries.
External sales by operating segment for the periods ended June 30, 2026 and 2025 are as follows:
| Three Months Ended June 30, |
Six Months Ended June 30, |
|||||||||||||||||||||||||||||||
| 2026 |
2025 |
2026 |
2025 |
|||||||||||||||||||||||||||||
| % of |
% of |
% of |
% of |
|||||||||||||||||||||||||||||
| Dollars |
Total |
Dollars |
Total |
Dollars |
Total |
Dollars |
Total |
|||||||||||||||||||||||||
| Light Vehicle |
$ | 1,379 | 68.6 | % | $ | 1,335 | 69.0 | % | $ | 2,648 | 68.3 | % | $ | 2,548 | 68.6 | % | ||||||||||||||||
| Commercial Vehicle |
631 | 31.4 | % | 600 | 31.0 | % | 1,230 | 31.7 | % | 1,168 | 31.4 | % | ||||||||||||||||||||
| Total |
$ | 2,010 | $ | 1,935 | $ | 3,878 | $ | 3,716 | ||||||||||||||||||||||||
See Note 17 to our consolidated financial statements in Item 1 of Part I for further financial information about our operating segments.
Our internet address is www.dana.com. The inclusion of our website address in this report is an inactive textual reference only and is not intended to include or incorporate by reference the information on our website into this report.
Trends in Our Markets
We serve our customers in two core global end markets: light vehicle, primarily full frame trucks and SUVs; and commercial vehicle, including medium-and heavy-duty trucks and busses. Each of our end-markets has unique cyclical dynamics and market drivers. These cycles are impacted by periods of investment where end-user vehicle fleets are refreshed or expanded in reaction to demand usage patterns, regulatory changes, or when the age of vehicles in service reach their useful life. Key market drivers include regional economic growth rates; cost and availability of end customer financing; and industrial output. Our multi-market coverage and broad customer base help provide stability across the cycles while mitigating secular variability.
Light vehicle markets — Our driveline business is weighted more heavily to the truck and SUV segments of the light-vehicle market versus the passenger-car segment. Our vehicle content is greater on rear-wheel drive, four-wheel drive, and all-wheel drive vehicles, as well as hybrid and electric vehicles. During 2025, light-truck markets showed marginal improvement across all regions except North America, which was flat compared to 2024. The outlook for 2026 reflects global light-truck production being relatively stable in North America and Asia Pacific, while Europe and South America reflect marginal improvement, in comparison with the prior year.
Commercial vehicle markets — Our primary business is driveline systems for medium and heavy-duty trucks and busses, including the emerging market for hybrid and electric vehicles. Key regional markets are North America, South America (primarily Brazil) and Asia Pacific. During 2025, production of Class-8 and Classes 5-7 trucks in North America both decreased 23% compared to 2024. The outlook for 2026 is for a modest decrease in production of Classes 5-7 trucks and a modest increase in Class-8 truck production compared to the prior year. Outside of North America, production of medium- and heavy-duty trucks in South America decreased 7% compared to 2024, reflecting relatively stable economic conditions in the region. The 2026 outlook for South America reflects medium- and heavy-duty production being relatively flat compared to the prior year. Production of medium- and heavy-duty trucks in Asia Pacific, driven by China and India, increased 12% in 2025. The 2026 outlook for Asia Pacific is for a modest increase in production from the prior year.
Foreign currency — With 44% of our first six months 2026 sales coming from outside the U.S., international currency movements can have a significant effect on our sales and results of operations. The euro zone countries accounted for 33% of our year-to-date 2026 non-U.S. sales, while Brazil, India, Thailand, China, Argentina and South Africa accounted for 14%, 9%, 7%, 7%, 7% and 6%, respectively. International currencies strengthened against the U.S. dollar during the first six months of 2026, increasing sales by $88, with the effects of a stronger euro, Brazilian real, South African rand and Thai baht being partially offset by a weaker Indian rupee.
Argentina has experienced significant inflationary pressures the past few years, contributing to significant devaluation of its currency among other economic challenges. Our Argentine operation supports our Light Vehicle operating segment. Our sales in Argentina for the six months of 2026 of approximately $111 are 3% of our consolidated sales and our net asset exposure related to Argentina was approximately $79, including $21 of net fixed assets, at June 30, 2026. During the second quarter of 2018, we determined that Argentina's economy met the GAAP definition of a highly inflationary economy. In assessing Argentina's economy as highly inflationary we considered its three-year cumulative inflation rate along with other factors. As a result, effective July 1, 2018, the U.S. dollar is the functional currency for our Argentine operations, rather than the Argentine peso. Beginning July 1, 2018, peso-denominated monetary assets and liabilities are remeasured into U.S. dollars using current Argentine peso exchange rates with resulting translation gains or losses included in results of operations. Nonmonetary assets and liabilities are remeasured into U.S. dollar using historic Argentine peso exchange rates.
Commodity costs — The cost of our products may be significantly impacted by changes in raw material commodity prices, the most important to us being those of various grades of steel, aluminum, copper, brass and rare earth materials. The effects of changes in commodity prices are reflected directly in our purchases of commodities and indirectly through our purchases of products such as castings, forgings, bearings, batteries and component parts that include commodities. Most of our major customer agreements provide for the sharing of significant commodity price changes with those customers based on the movement in various published commodity indexes. Where such formal agreements are not present, we have historically been successful implementing price adjustments that largely compensate for the inflationary impact of material costs. Material cost changes will customarily have some impact on our financial results as customer pricing adjustments typically lag commodity price changes. Higher year-over-year commodity prices decreased earnings during the second quarter and first half of 2026 by $15 and $23, respectively. Material cost recovery pricing actions increased earnings in the second quarter and first half of 2026 by $12 and $18, respectively.
Sales, Earnings and Cash Flow Outlook
| 2026 Outlook |
|
| Sales |
$7,650 - $7,850 |
| Adjusted EBITDA |
$800 - $850 |
| Adjusted Free Cash Flow |
$275 - $375 |
Adjusted EBITDA and adjusted free cash flow are non-GAAP financial measures. See the Non-GAAP Financial Measures discussion below for definitions of our non-GAAP financial measures and reconciliations to the most directly comparable U.S. generally accepted accounting principles (GAAP) measures. We have not provided a reconciliation of our adjusted EBITDA outlook to the most comparable GAAP measure of net income. Providing net income guidance is potentially misleading and not practical given the difficulty of projecting event driven transactional and other non-core operating items that are included in net income, including restructuring actions, asset impairments and certain income tax adjustments. The accompanying reconciliations of these non-GAAP measures with the most comparable GAAP measures for the historical periods presented are indicative of the reconciliations that will be prepared upon completion of the periods covered by the non-GAAP guidance.
Our 2026 sales outlook is $7,650 to $7,850, reflecting relatively stable global market demand, $200 of net new business backlog, dissipation of the tariff recovery lag experienced in 2025 and currency tailwinds. Based on our current sales and exchange rate outlook for 2026, we expect international currencies to be a modest tailwind to sales primarily due to a stronger euro. At sales levels in our current outlook for 2026, a 5% movement on the euro would impact our annual sales by approximately $65. A 5% change on the Indian rupee or Brazilian real rates would impact our annual sales in each of those countries by approximately $15. A 5% change on the Chinese renminbi rate would impact our annual sales by approximately $10. At our current sales outlook for 2026, we expect full year 2026 adjusted EBITDA to approximate $800 to $850. Adjusted EBITDA margin is expected to be 10.6% at the midpoint of our guidance range, a 250 basis-point improvement over 2025, reflecting the impact of significant cost savings actions, improved operational performance and favorable product mix, partially offset by the impact of net material cost recoveries and net inflationary cost recoveries. We expect to generate free cash flow of $325 at the midpoint of our guidance range reflecting the benefit of higher year-over-year adjusted EBITDA and lower income tax and interest payments, partially offset by higher capital spending.
Among our operational and strategic initiatives is continued focus on and investment in product technology – delivering products and technology that are key to bringing solutions to issues of paramount importance to our customers. Our success on this front is measured, in part, by our sales backlog – net new business awarded that will be launching over the next three years, adding to our base annual sales. This backlog excludes replacement business and represents incremental sales associated with new programs for which we have received formal customer awards. At June 30, 2026, our sales backlog of net new business for the 2026 through 2028 period was $950. We expect to realize $200 of our sales backlog in 2026, with incremental sales backlog of $300 and $450 being realized in 2027 and 2028, respectively.
Summary Consolidated Results of Operations (Second Quarter, 2026 versus 2025)
| Three Months Ended June 30, |
||||||||||||||||||||
| 2026 |
2025 |
|||||||||||||||||||
| Dollars |
% of Net Sales |
Dollars |
% of Net Sales |
Increase/ (Decrease) |
||||||||||||||||
| Net sales |
$ | 2,010 | $ | 1,935 | $ | 75 | ||||||||||||||
| Cost of sales |
1,800 | 89.6 | % | 1,797 | 92.9 | % | 3 | |||||||||||||
| Gross margin |
210 | 10.4 | % | 138 | 7.1 | % | 72 | |||||||||||||
| Selling, general and administrative expenses |
104 | 5.2 | % | 99 | 5.1 | % | 5 | |||||||||||||
| Amortization of intangibles |
1 | 2 | (1 | ) | ||||||||||||||||
| Restructuring charges, net |
9 | 11 | (2 | ) | ||||||||||||||||
| Other income (expense), net |
(20 | ) | (10 | ) | (10 | ) | ||||||||||||||
| Earnings from continuing operations before interest and income taxes |
76 | 16 | 60 | |||||||||||||||||
| Interest income |
4 | 3 | 1 | |||||||||||||||||
| Interest expense |
21 | 44 | (23 | ) | ||||||||||||||||
| Earnings (loss) from continuing operations before income taxes |
59 | (25 | ) | 84 | ||||||||||||||||
| Income tax expense |
54 | 10 | 44 | |||||||||||||||||
| Equity in earnings of affiliates |
6 | 23 | (17 | ) | ||||||||||||||||
| Net income (loss) from continuing operations |
11 | (12 | ) | 23 | ||||||||||||||||
| Net income (loss) from discontinued operations |
(11 | ) | 43 | (54 | ) | |||||||||||||||
| Net income |
— | 31 | (31 | ) | ||||||||||||||||
| Less: Noncontrolling interests net income from continuing operations |
5 | 4 | 1 | |||||||||||||||||
| Net income (loss) attributable to the parent company |
$ | (5 | ) | $ | 27 | $ | (32 | ) | ||||||||||||
Sales — The following table shows changes in our sales by geographic region.
| Three Months Ended |
||||||||||||||||||||||||
| June 30, |
Amount of Change Due To |
|||||||||||||||||||||||
| 2026 |
2025 |
Increase/ (Decrease) |
Currency Effects |
Divestiture |
Organic Change |
|||||||||||||||||||
| North America |
$ | 1,202 | $ | 1,157 | $ | 45 | $ | 2 | $ | — | $ | 43 | ||||||||||||
| Europe |
411 | 386 | 25 | 13 | 12 | |||||||||||||||||||
| South America |
199 | 183 | 16 | 13 | 3 | |||||||||||||||||||
| Asia Pacific |
198 | 209 | (11 | ) | (4 | ) | (7 | ) | ||||||||||||||||
| Total |
$ | 2,010 | $ | 1,935 | $ | 75 | $ | 24 | $ | — | $ | 51 | ||||||||||||
Sales in the second quarter of 2026 were $75 higher than 2025. Stronger international currencies increased sales by $24, principally due to a stronger Brazilian real, euro and South African rand, partially offset by a weaker India rupee. The organic sales increase of $51 primarily resulted from pricing actions and recoveries, including material commodity, tariff and inflationary costs adjustments, higher full-frame light-truck production volumes in North America and the conversion of sales backlog, partially offset by lower medium/heavy-truck production volumes in North America and lower electric-vehicle product orders in Europe and Asia Pacific. Pricing actions and recoveries, including material commodity, tariff and inflationary costs adjustments, increased sales by $45.
The North America organic sales increase of 4% was driven principally by net customer pricing, tariff and cost recovery actions, higher full-frame light-truck production volumes and the conversion of sales backlog, partially offset by lower medium- and heavy-truck production volumes. Second quarter 2026 full-frame light-truck production was up 6%. Second quarter 2026 Class 8 and Classes 5-7 production were down 8% and 10%, respectively. Excluding currency effects, sales in Europe were up 3% compared to 2025, reflecting net customer pricing and cost recovery actions. Excluding currency effects, sales in South America were up 2% compared to 2025, reflecting higher year-over-year medium/heavy-truck production volumes. Excluding currency effects, sales in Asia Pacific decreased 3% reflecting lower electric vehicle-related product orders, partially offset by a modest improvement in year-over-year second quarter medium/heavy-truck production volumes.
Cost of sales and gross margin — Cost of sales for the second quarter of 2026 increased $3 when compared to 2025. Cost of sales as a percent of sales was 330 basis points lower than in the previous year. Incremental margins from cost reduction initiatives of $18, higher material cost savings of $24, operational efficiencies of $6, lower incentive compensation expense of $3, lower premium freight costs of $2 and favorable product mix were partially offset by non-material inflation of $26, commodity cost increases of $15, higher spending on electrification initiatives of $7, higher warranty expense of $1 and higher program launch costs of $1. Commodity costs are primarily driven by certain grades of steel and aluminum. Non-material inflation includes higher labor, energy and transportation rates.
Gross margin of $210 for the second quarter of 2026 increased $72 from 2025. Gross margin as a percent of sales was 10.4% in the second quarter of 2026, 330 basis points higher than in 2025. The improvement in gross margin as a percent of sales was driven principally by the cost of sales factors referenced above. Material cost recovery mechanisms with our customers lag material cost changes by our suppliers by approximately 90 days. The recovery of non-material inflation is not specifically provided for in our current contracts with customers resulting in prolonged negotiations and indeterminate recoveries.
Selling, general and administrative expenses (SG&A) — SG&A expenses in the second quarter of 2026 were $104 (5.2% of sales) as compared to $99 (5.1% of sales) in the second quarter of 2025. SG&A expenses were $5 higher in the second quarter of 2026 primarily due to higher legal and professional services costs.
Amortization of intangibles — Amortization expense was $1 in the second quarter of 2026 and $2 in the second quarter of 2025. See Note 3 of our consolidated financial statements in Item 1 of Part I for additional information.
Restructuring charges, net — Net restructuring charges were $9 in the second quarter of 2026 and $11 in the second quarter of 2025. See Note 4 of our consolidated financial statements in Item 1 of Part I for additional information.
Other income (expense), net — The following table shows the major components of other income (expense), net.
| Three Months Ended |
||||||||
| June 30, |
||||||||
| 2026 |
2025 |
|||||||
| Non-service cost components of pension and OPEB costs |
$ | (3 | ) | $ | (2 | ) | ||
| Government assistance |
1 | 2 | ||||||
| Foreign exchange loss |
(6 | ) | (1 | ) | ||||
| Strategic transaction expenses |
(19 | ) | (5 | ) | ||||
| Electric vehicle program termination charges |
(3 | ) | ||||||
| Loss on divestiture of ownership interests |
(7 | ) | ||||||
| Transition services income |
8 | |||||||
| Other, net |
2 | 3 | ||||||
| Other income (expense), net |
$ | (20 | ) | $ | (10 | ) | ||
Strategic transaction expenses relate primarily to costs incurred in connection with acquisition and divestiture related activities, including costs to complete the transaction and post-closing integration costs, and other strategic initiatives. Strategic transaction expenses in 2026 were primarily attributable to the potential acquisition of Eaton's Mobility business. See Note 1 of our consolidated financial statements in Item 1 of Part I for additional information. During the second quarter of 2026, we recorded $3 of charges, including impairment and loss on disposition of property, plant and equipment, associated with certain electric vehicle programs that were either cancelled by the customer or that have experienced a precipitous decline in program volumes. On January 1, 2026, we sold our Off-Highway business to Allison Transmission Holdings, Inc. (Allison). At closing, Dana entered into a transition services agreement and an engineering services agreement with Allison. Services to be provided by Dana under the transition services agreement include finance, information technology, human resources and certain other administrative services for periods up to 24 months. See Note 2 to our consolidated financial statements in Item 1 of Part I for additional information. On June 6, 2025, we sold our ownership interest in Switch Mobility Limited, recognizing an $8 pre-tax loss on the transaction. See Note 18 to our consolidated financial statements in Item 1 of Part I for additional information.
Interest income and interest expense — Interest income was $4 in the second quarter of 2026 and $3 in the second quarter of 2025. Interest expense decreased from $44 in the second quarter of 2025 to $21 in the second quarter of 2026, reflecting lower average outstanding borrowings. See Note 10 of our consolidated financial statements in Item 1 of Part I for additional information. Average effective interest rates, inclusive of amortization of debt issuance costs, approximated 6.2% in the second quarter of 2026 and 5.8% in the second quarter of 2025.
Income tax expense — We reported income tax expense of $54 and $10 for the second quarters of 2026 and 2025, respectively. Our effective tax rates were 92% and (40)% for the second quarters of 2026 and 2025, respectively. During the second quarter of 2025, we recorded tax expense of $6 resulting from the sale of Dana's ownership interest in an equity method investment. Our effective income tax rates vary from the U.S. federal statutory rate of 21% due to establishment, release, and adjustment of valuation allowances in several countries, nondeductible expenses and deemed income, local tax incentives in several countries outside the U.S., different statutory tax rates outside the U.S. and withholding taxes related to repatriations of international earnings. The effective income tax rate may vary significantly due to fluctuations in the amounts and sources, both foreign and domestic, of pretax income and changes in the amounts of non-deductible expenses.
Equity in earnings of affiliates — Net earnings from equity investments was $6 in the second quarter of 2026 and $23 in the second quarter of 2025. Net earnings from Dongfeng Dana Axle Co., Ltd. (DDAC) were $5 in the second quarter of 2026 and $4 in the second quarter of 2025. On April 25, 2025, we sold our ownership interest in Axles India Limited, recognizing a $19 pre-tax gain on the transaction. See Note 18 of our consolidated financial statements in Item 1 of Part I for additional information.
Net income from discontinued operations — Net income (loss) from discontinued operations was a loss of $11 in the second quarter of 2026 and income of $43 in the second quarter of 2025. The Off-Highway business sale transaction closed on January 1, 2026. The Off-Highway business's Mexican operations continue to be presented as discontinued operations, as those operations have not yet legally transferred to the buyer. See Note 2 of our consolidated financial statements in Item 1 of Part I for additional information.
Summary Consolidated Results of Operations (Year-to-Date Quarter, 2026 versus 2025)
| Six Months Ended June 30, |
||||||||||||||||||||
| 2026 |
2025 |
|||||||||||||||||||
| Dollars |
% of Net Sales |
Dollars |
% of Net Sales |
Increase/ (Decrease) |
||||||||||||||||
| Net sales |
$ | 3,878 | $ | 3,716 | $ | 162 | ||||||||||||||
| Cost of sales |
3,499 | 90.2 | % | 3,460 | 93.1 | % | 39 | |||||||||||||
| Gross margin |
379 | 9.8 | % | 256 | 6.9 | % | 123 | |||||||||||||
| Selling, general and administrative expenses |
206 | 5.3 | % | 204 | 5.5 | % | 2 | |||||||||||||
| Amortization of intangibles |
3 | 4 | (1 | ) | ||||||||||||||||
| Restructuring charges, net |
15 | 13 | 2 | |||||||||||||||||
| Other income (expense), net |
(60 | ) | (11 | ) | (49 | ) | ||||||||||||||
| Earnings from continuing operations before interest and income taxes |
95 | 24 | 71 | |||||||||||||||||
| Loss on extinguishment of debt |
(7 | ) | (7 | ) | ||||||||||||||||
| Interest income |
10 | 5 | 5 | |||||||||||||||||
| Interest expense |
43 | 83 | (40 | ) | ||||||||||||||||
| Earnings (loss) from continuing operations before income taxes |
55 | (54 | ) | 109 | ||||||||||||||||
| Income tax expense |
68 | 68 | ||||||||||||||||||
| Equity in earnings of affiliates |
9 | 25 | (16 | ) | ||||||||||||||||
| Net loss from continuing operations |
(4 | ) | (29 | ) | 25 | |||||||||||||||
| Net income from discontinued operations |
1,095 | 90 | 1,005 | |||||||||||||||||
| Net income |
1,091 | 61 | 1,030 | |||||||||||||||||
| Less: Noncontrolling interests net income from continuing operations |
9 | 9 | — | |||||||||||||||||
| Net income attributable to the parent company |
$ | 1,082 | $ | 52 | $ | 1,030 | ||||||||||||||
Sales — The following table shows changes in our sales by geographic region.
| Six Months Ended |
||||||||||||||||||||||||
| June 30, |
Amount of Change Due To |
|||||||||||||||||||||||
| 2026 |
2025 |
Increase/ (Decrease) |
Currency Effects |
(Divestitures) |
Organic Change |
|||||||||||||||||||
| North America |
$ | 2,286 | $ | 2,205 | $ | 81 | $ | 6 | $ | — | $ | 75 | ||||||||||||
| Europe |
819 | 747 | 72 | 57 | 15 | |||||||||||||||||||
| South America |
360 | 338 | 22 | 25 | (3 | ) | ||||||||||||||||||
| Asia Pacific |
413 | 426 | (13 | ) | (13 | ) | ||||||||||||||||||
| Total |
$ | 3,878 | $ | 3,716 | $ | 162 | $ | 88 | $ | — | $ | 74 | ||||||||||||
Sales in the first six months of 2026 were $162 higher than 2025. Stronger international currencies increased sales by $88, principally due to a stronger euro, Brazilian real, South African rand and Thai baht, partially offset by a weaker India rupee. The organic sales increase of $74 primarily resulted from pricing actions and recoveries, including material commodity, tariff and inflationary costs adjustments, and the conversion of sales backlog, partially offset by lower medium/heavy-truck production volumes in North America and lower electric-vehicle product orders in Europe and Asia Pacific. Pricing actions and recoveries, including material commodity, tariff and inflationary costs adjustments, increased sales by $101.
The North America organic sales increase of 3% was driven principally by net customer pricing, tariff and cost recovery actions and the conversion of sales backlog, partially offset by lower medium- and heavy-truck production volumes. First six months 2026 Class 8 and Classes 5-7 production were down 17% and 16%, respectively. Excluding currency effects, sales in Europe were up 2% compared to 2025, reflecting net customer pricing and cost recovery actions and a modest improvement in year-over-year first six months medium/heavy-truck production volumes. Excluding currency effects, sales in South America were down 1% compared to 2025, reflecting lower year-over-year medium/heavy-truck product sales. Excluding currency effects, sales in Asia Pacific decreased 3% reflecting lower electric vehicle-related product orders, partially offset by a modest improvement in year-over-year first-half medium/heavy-truck production volumes.
Cost of sales and gross margin — Cost of sales for the first six months of 2026 increased $39 when compared to 2025. Cost of sales as a percent of sales was 290 basis points lower than in the previous year. Incremental margins from cost reduction initiatives of $51, higher material cost savings of $47, operational efficiencies of $20, lower premium freight costs of $12, lower incentive compensation expense of $2 and favorable product mix were partially offset by tariff-related impacts of $50, non-material inflation of $49, commodity cost increases of $23, higher spending on electrification initiatives of $13 and higher warranty expense of $3. Commodity costs are primarily driven by certain grades of steel and aluminum. Non-material inflation includes higher labor, energy and transportation rates.
Gross margin of $379 for the first six months of 2026 increased $123 from 2025. Gross margin as a percent of sales was 9.8% in the first six months of 2026, 290 basis points higher than in 2025. The improvement in gross margin as a percent of sales was driven principally by the cost of sales factors referenced above. Material cost recovery mechanisms with our customers lag material cost changes by our suppliers by approximately 90 days. The recovery of non-material inflation is not specifically provided for in our current contracts with customers resulting in prolonged negotiations and indeterminate recoveries.
Selling, general and administrative expenses (SG&A) — SG&A expenses in the first six months of 2026 were $206 (5.3% of sales) as compared to $204 (5.5% of sales) in the first six months of 2025. SG&A expenses were $2 higher in the first six months of 2026 primarily due to higher legal and professional services costs.
Amortization of intangibles — Amortization expense was $3 in the first six months of 2026 and $4 in the first six months of 2025. See Note 3 of our consolidated financial statements in Item 1 of Part I for additional information.
Restructuring charges, net — Net restructuring charges were $15 in the first six months of 2026 and $13 in the first six months of 2025. See Note 4 of our consolidated financial statements in Item 1 of Part I for additional information.
Other income (expense), net — The following table shows the major components of other income (expense), net.
| Six Months Ended |
||||||||
| June 30, |
||||||||
| 2026 |
2025 |
|||||||
| Non-service cost components of pension and OPEB costs |
$ | (4 | ) | $ | (4 | ) | ||
| Government assistance |
1 | 4 | ||||||
| Foreign exchange gain (loss) |
11 | (6 | ) | |||||
| Strategic transaction expenses |
(20 | ) | (6 | ) | ||||
| Gain on sale of property, plant and equipment |
1 | |||||||
| Electric vehicle program termination charges |
(59 | ) | ||||||
| Loss on divestiture of ownership interests |
(8 | ) | (7 | ) | ||||
| Transition services income |
18 | |||||||
| Other, net |
1 | 7 | ||||||
| Other income (expense), net |
$ | (60 | ) | $ | (11 | ) | ||
Strategic transaction expenses relate primarily to costs incurred in connection with acquisition and divestiture related activities, including costs to complete the transaction and post-closing integration costs, and other strategic initiatives. Strategic transaction expenses in 2026 were primarily attributable to the potential acquisition of Eaton's Mobility business. See Note 1 of our consolidated financial statements in Item 1 of Part I for additional information. During the first six months of 2026, we recorded $59 of charges, including impairment and loss on disposition of property, plant and equipment, associated with certain electric vehicle programs that were either cancelled by the customer or that have experienced a precipitous decline in program volumes. On January 1, 2026, we sold our Off-Highway business to Allison Transmission Holdings, Inc. (Allison). At closing, Dana entered into a transition services agreement and an engineering services agreement with Allison. Services to be provided by Dana under the transition services agreement include finance, information technology, human resources and certain other administrative services for periods up to 24 months. See Note 2 of our consolidated financial statements in Item 1 of Part I for additional information. On January 30, 2026, we sold our wholly-owned subsidiary Pi Innovo LLC, recognizing a $8 pre-tax loss on the transaction. On June 6, 2025, we sold our ownership interest in Switch Mobility Limited, recognizing an $8 pre-tax loss on the transaction. See Note 18 to our consolidated financial statements in Item 1 of Part I for additional information.
Loss on extinguishment of debt — The $7 loss on extinguishment of debt is comprised of the write-off of deferred financing costs associated with purchases and redemptions of certain of our senior notes and the repayment of our Term A Facility during the first quarter of 2026. See Note 10 of our consolidated financial statements in Item 1 of Part I for additional information.
Interest income and interest expense — Interest income was $10 in the first six months of 2026 and $5 in the first six months of 2025. Interest expense decreased from $83 in the first six months of 2025 to $43 in the first six months of 2026, reflecting lower average outstanding borrowings. See Note 10 of our consolidated financial statements in Item 1 of Part I for additional information. Average effective interest rates, inclusive of amortization of debt issuance costs, approximated 6.4% in the first six months of 2026 and 5.6% in the first six months of 2025.
Income tax expense — We reported income tax expense of $68 and $0 for the first six months of 2026 and 2025, respectively. Our effective tax rates were 124% and 0% for the first six months of 2026 and 2025, respectively. During the first six months of 2026, we recorded $12 of tax expense due to revisions in our assertions on unremitted earnings in foreign jurisdictions. During the first six months of 2025, we recorded a tax benefit of $19 due to a basis difference in a foreign subsidiary as a result of a change in tax status, $9 of tax expense for income tax reserves associated with prior tax years in foreign jurisdictions and tax expense of $6 resulting from the sale of Dana's ownership interest in an equity method investment. Our effective income tax rates vary from the U.S. federal statutory rate of 21% due to establishment, release, and adjustment of valuation allowances in several countries, nondeductible expenses and deemed income, local tax incentives in several countries outside the U.S., different statutory tax rates outside the U.S. and withholding taxes related to repatriations of international earnings. The effective income tax rate may vary significantly due to fluctuations in the amounts and sources, both foreign and domestic, of pretax income and changes in the amounts of non-deductible expenses.
Equity in earnings of affiliates — Net earnings from equity investments was $9 in the first six months of 2026 and $25 in the first six months of 2025. Net earnings from Dongfeng Dana Axle Co., Ltd. (DDAC) were $7 in the first six months of 2026 and $4 in the first six months of 2025. On April 25, 2025, we sold our ownership interest in Axle India Limited, recognizing a $19 pre-tax gain on the transaction. See Note 18 of our consolidated financial statements in Item 1 of Part I for additional information.
Net income from discontinued operations — Net income from discontinued operations was $1,095 in the first six months of 2026 and $90 in the first six months of 2025. The Off-Highway business sale transaction closed on January 1, 2026, with a $1,186 pre-tax gain being recognized in net income from discontinued operations during the first six months of 2026. The Off-Highway business's Mexican operations continue to be presented as discontinued operations, as those operations have not yet legally transferred to the buyer. See Note 2 of our consolidated financial statements in Item 1 of Part I for additional information.
Segment Results of Operations (2026 versus 2025)
Light Vehicle
| Three Months |
Six Months |
|||||||||||||||||||||||
| Sales |
Segment EBITDA |
Segment EBITDA Margin |
Sales |
Segment EBITDA |
Segment EBITDA Margin |
|||||||||||||||||||
| 2025 |
$ | 1,335 | $ | 112 | 8.4 | % | $ | 2,548 | $ | 180 | 7.1 | % | ||||||||||||
| Volume and mix |
2 | 14 | (7 | ) | 45 | |||||||||||||||||||
| Performance |
35 | 17 | 71 | 29 | ||||||||||||||||||||
| Currency effects |
7 | 36 | 1 | |||||||||||||||||||||
| 2026 |
$ | 1,379 | $ | 143 | 10.4 | % | $ | 2,648 | $ | 255 | 9.6 | % | ||||||||||||
Light Vehicle sales in the second quarter of 2026, exclusive of currency effects, were 3% higher than 2025 reflecting the benefit of net customer pricing and cost and tariff recovery actions and the conversion of sales backlog partially offset by lower global electric-vehicle product orders. Year-over-year North America full-frame light-truck production increased 6% and light-truck production in South America and Asia Pacific increased 11% and 6%, respectively. Year-over-year light-truck production in Europe decreased 1%. Year-over-year light-vehicle engine production was flat in North America and Asia Pacific. Year-over-year light-vehicle engine production increased 2% in South America and decreased 7% in Europe. Net customer pricing and cost and tariff recovery actions increased year-over-year second quarter sales by $35. Light Vehicle sales in the first half of 2026, exclusive of currency effects, were 3% higher than 2025 reflecting the benefit of net customer pricing and cost and tariff recovery actions and the conversion of sales backlog partially offset by lower global electric-vehicle product orders. Year-over-year North America full-frame light-truck production increased 6% and light-truck production in Europe, South America and Asia Pacific increased 3%, 10% and 5%, respectively. Year-over-year light-vehicle engine production was flat in North America and Asia Pacific. Year-over-year light-vehicle engine production increased 5% in South America and decreased 5% in Europe. Net customer pricing and cost and tariff recovery actions increased year-over-year first-half sales by $71.
Light Vehicle second-quarter and first-half EBITDA increased $31 and $75, respectively, from the comparable periods of 2025. Higher sales volumes, favorable product mix and improved pricing on electric vehicle programs increased second-quarter EBITDA by $14. Favorable product mix and improved pricing on electric vehicle programs was partially offset by lower sales volumes, increasing first-half EBITDA by $45. The year-over-year performance-related earnings increase in the second quarter of 2026 was driven by net customer pricing and cost and tariff recovery actions of $35, higher material cost savings of $16, lower premium freight costs of $5, cost reduction initiatives of $3, lower incentive compensation expense of $3 and operational efficiencies, including lower corporate allocations resulting from cost reduction initiatives of $4. Partially offsetting these performance-related earnings increases were inflationary cost increases of $20, commodity cost increases of $11, higher tariff-related costs of $10, net foreign currency transaction losses of $7 and higher program launch costs of $1. The year-over-year performance-related earnings increase in the first half of 2026 was driven by net customer pricing and cost and tariff recovery actions of $71, higher material cost savings of $30, lower premium freight costs of $13, cost reduction initiatives of $8, lower incentive compensation expense of $3 and operational efficiencies, including lower corporate allocations resulting from cost reduction initiatives of $17. Partially offsetting these performance-related earnings increases were higher tariff-related costs of $46, inflationary cost increases of $39, commodity cost increases of $17, net foreign currency transaction losses of $7, higher warranty expense of $3 and higher program launch costs of $1.
Commercial Vehicle
| Three Months |
Six Months |
|||||||||||||||||||||||
| Sales |
Segment EBITDA |
Segment EBITDA Margin |
Sales |
Segment EBITDA |
Segment EBITDA Margin |
|||||||||||||||||||
| 2025 |
$ | 600 | $ | 47 | 7.8 | % | $ | 1,168 | $ | 88 | 7.5 | % | ||||||||||||
| Volume and mix |
4 | (4 | ) | (20 | ) | (8 | ) | |||||||||||||||||
| Performance |
10 | 23 | 30 | 45 | ||||||||||||||||||||
| Currency effects |
17 | 2 | 52 | 6 | ||||||||||||||||||||
| 2026 |
$ | 631 | $ | 68 | 10.8 | % | $ | 1,230 | $ | 131 | 10.7 | % | ||||||||||||
Commercial Vehicle sales in the second quarter of 2026, exclusive of currency effects, were 2% higher than 2025 reflecting a stronger Asia Pacific market, the conversion of sales backlog and net customer pricing and cost and tariff recovery actions, partially offset by a weakening North America market. Year-over-year Class 8 production in North America was down 8% while Classes 5-7 was down 10% in this year’s second quarter. Year-over-year medium/heavy-truck production in South America and Asia Pacific were up 6% and 12%, respectively, while Europe was down 3% in this year’s second quarter. Net customer pricing and cost and tariff recovery actions increased year-over-year sales by $10 in this year’s second quarter. Commercial Vehicle sales in the first half of 2026, exclusive of currency effects, were 1% higher than 2025 reflecting a stronger Asia Pacific market, the conversion of sales backlog and net customer pricing and cost and tariff recovery actions, partially offset by a weakening North America market. Year-over-year Class 8 production in North America was down 17% while Classes 5-7 was down 16% in this year's first half. Year-over-year medium/heavy-truck production in Europe, South America and Asia Pacific were up 3%, 1% and 11%, respectively. Net customer pricing and cost and tariff recovery actions increased year-over-year sales by $30 in this year's first half.
Commercial Vehicle second-quarter and first-half 2026 segment EBITDA increased $21 and $43, respectively, from the comparable periods of 2025. The EBITDA benefit of higher sales volumes was offset by unfavorable product mix in the second quarter of 2026. Lower sales volumes decreased year-over-year earnings by $8 (40% decremental margin) in the first half of 2026. Unfavorable product mix in the first half of 2026 contributed to the decremental margin. The year-over-year performance-related earnings increase in the second quarter of 2026 was driven by net customer pricing and cost and tariff recovery actions of $10, net tariff refunds of $10, higher material cost savings of $8, cost reduction initiatives of $3, net foreign currency transaction gains of $3, lower incentive compensation expense of $2 and operational efficiencies, including lower corporate allocations resulting from cost reduction initiatives of $7. Partially offsetting these performance-related earnings increases were higher spending on electrification initiatives of $7, inflationary cost increases of $5, commodity cost increases of $4, higher premium freight costs of $3 and higher warranty expense of $1. The year-over-year performance-related earnings increase in the first half of 2026 was driven by net customer pricing and cost and tariff recovery actions of $30, higher material cost savings of $17, cost reduction initiatives of $6, net foreign currency transaction gains of $3, lower incentive compensation expense of $1, lower program launch costs of $1 and operational efficiencies, including lower corporate allocations resulting from cost reduction initiatives of $20. Partially offsetting these performance-related earnings increases were higher spending on electrification initiatives of $13, inflationary cost increases of $9, commodity cost increases of $6, higher tariff-related costs of $4 and higher premium freight costs of $1.
Non-GAAP Financial Measures
Adjusted EBITDA
We have defined adjusted EBITDA as net income (loss) from continuing operations before interest, income taxes, depreciation, amortization, equity grant expense, restructuring expense, non-service cost components of pension and other postretirement benefits (OPEB) costs and other adjustments not related to our core operations (gain/loss on debt extinguishment, pension settlements, divestitures, impairment, etc.). Adjusted EBITDA is a measure of our ability to maintain and continue to invest in our operations and provide shareholder returns. We use adjusted EBITDA in assessing the effectiveness of our business strategies, evaluating and pricing potential acquisitions and as a factor in making incentive compensation decisions. In addition to its use by management, we also believe adjusted EBITDA is a measure widely used by securities analysts, investors and others to evaluate financial performance of our company relative to other Tier 1 automotive suppliers. Adjusted EBITDA should not be considered a substitute for earnings (loss) before income taxes, net income (loss) or other results reported in accordance with GAAP. Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies.
The following table provides a reconciliation of net income (loss) from continuing operations to adjusted EBITDA.
| Three Months Ended |
Six Months Ended |
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| June 30, |
June 30, |
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| 2026 |
2025 |
2026 |
2025 |
|||||||||||||
| Net income (loss) from continuing operations |
$ | 11 | $ | (12 | ) | $ | (4 | ) | $ | (29 | ) | |||||
| Equity in earnings of affiliates |
6 | 23 | 9 | 25 | ||||||||||||
| Income tax expense |
54 | 10 | 68 | |||||||||||||
| Earnings (loss) from continuing operations before income taxes |
59 | (25 | ) | 55 | (54 | ) | ||||||||||
| Depreciation and amortization |
84 | 92 | 171 | 177 | ||||||||||||
| Restructuring charges, net |
9 | 11 | 15 | 13 | ||||||||||||
| Interest expense, net |
17 | 41 | 33 | 78 | ||||||||||||
| Loss on extinguishment of debt |
7 | |||||||||||||||
| Loss on divestiture of ownership interests |
7 | 8 | 7 | |||||||||||||
| Electric vehicle program termination charges |
8 | 64 | ||||||||||||||
| Foreign currency gain on unhedged intercompany loans |
(2 | ) | (23 | ) | ||||||||||||
| Supplier capacity charge adjustment |
(19 | ) | ||||||||||||||
| Other* |
32 | 21 | 48 | 38 | ||||||||||||
| Adjusted EBITDA |
$ | 207 | $ | 147 | $ | 378 | $ | 240 | ||||||||
| * | Other includes stock compensation expense, non-service cost components of pension and OPEB costs, strategic transaction expenses and other items. See Note 17 to our consolidated financial statements in Item 1 of Part I for additional details. |
Adjusted Free Cash Flow
We have defined adjusted free cash flow as cash provided by (used in) operating activities less purchases of property, plant and equipment plus proceeds from sale of property, plant and equipment plus cash paid for purchases of leased facilities plus cash paid for Off-Highway business divestiture and Eaton Mobility business acquisition related activities. We believe adjusted free cash flow is useful to investors in evaluating the operational cash flow of the company inclusive of the spending required to maintain the operations. Adjusted free cash flow is not intended to represent nor be an alternative to the measure of net cash provided by operating activities reported in accordance with GAAP. Adjusted free cash flow may not be comparable to similarly titled measures reported by other companies.
The following table reconciles net cash flows provided by (used in) operating activities to adjusted free cash flow.
| Three Months Ended |
Six Months Ended |
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| June 30, |
June 30, |
|||||||||||||||
| 2026 |
2025 |
2026 |
2025 |
|||||||||||||
| Net cash provided by (used in) operating activities |
$ | 109 | $ | 32 | $ | (86 | ) | $ | (5 | ) | ||||||
| Purchases of property, plant and equipment - Continuing operations |
(142 | ) | (37 | ) | (204 | ) | (104 | ) | ||||||||
| Purchases of property, plant and equipment - Discontinued operations |
(1 | ) | (14 | ) | (1 | ) | (22 | ) | ||||||||
| Proceeds from sale of property, plant and equipment - Continuing operations |
1 | 2 | 11 | |||||||||||||
| Cash paid for purchase of leased facilities |
88 | 88 | ||||||||||||||
| Cash paid for Off-Highway business divestiture related activities |
13 | 12 | 74 | 12 | ||||||||||||
| Adjusted free cash flow |
$ | 68 | $ | (7 | ) | $ | (127 | ) | $ | (108 | ) | |||||
Liquidity
The following table provides a reconciliation of cash and cash equivalents to liquidity, a non-GAAP measure, at June 30, 2026:
| Cash and cash equivalents |
$ | 331 | ||
| Additional cash availability from Revolving Facility |
1,140 | |||
| Total liquidity |
$ | 1,471 |
We had availability of $1,140 at June 30, 2026 under our Revolving Facility after deducting $10 of outstanding letters of credit.
The components of our June 30, 2026 consolidated cash balance were as follows:
| U.S. |
Non-U.S. |
Total |
||||||||||
| Cash and cash equivalents |
$ | — | $ | 248 | $ | 248 | ||||||
| Cash and cash equivalents held at less than wholly-owned subsidiaries |
1 | 82 | 83 | |||||||||
| Consolidated cash balance |
$ | 1 | $ | 330 | $ | 331 | ||||||
A portion of the non-U.S. cash and cash equivalents is utilized for working capital and other operating purposes. Several countries have local regulatory requirements that restrict the ability of our operations to repatriate this cash. Beyond these restrictions, there are practical limitations on repatriation of cash from certain subsidiaries because of the resulting tax withholdings and subsidiary by-law restrictions which could limit our ability to access cash and other assets.
At June 30, 2026, we were in compliance with the covenants of our financing agreements. Under the Revolving Facility and our senior notes, we are required to comply with certain incurrence-based covenants customary for facilities of these types. The incurrence-based covenants in the Revolving Facility permit us to, among other things, (i) issue foreign subsidiary indebtedness, (ii) incur general secured indebtedness subject to a pro forma first lien net leverage ratio not to exceed 1.50:1.00 in the case of first lien debt and a pro forma secured net leverage ratio of 2.50:1.00 in the case of other secured debt and (iii) incur additional unsecured debt subject to a pro forma total net leverage ratio not to exceed 3.50:1.00, tested at the time of incurrence. We may also make dividend payments in respect of our common stock as well as certain investments and acquisitions subject to a pro forma total net leverage ratio of 2.75:1.00. In addition, the Revolving Facility is subject to a financial covenant requiring us to maintain a first lien net leverage ratio not to exceed 2.00:1.00. The indentures governing the senior notes include other incurrence-based covenants that may subject us to additional specified limitations.
From time to time, depending upon market, pricing and other conditions, as well as our cash balances and liquidity, we may seek to acquire our senior notes or other indebtedness through open market purchases, privately negotiated transactions, tender offers, exchange offers or otherwise, upon such terms and at such prices as we may determine (or as may be provided for in the indentures governing the notes), for cash, securities or other consideration. In addition, we may enter into sale-leaseback transactions related to certain of our real estate holdings and factor receivables. There can be no assurance that we will pursue any such transactions in the future, as the pursuit of any alternative will depend upon numerous factors such as market conditions, our financial performance and the limitations applicable to such transactions under our financing and governance documents.
On June 10, 2026, we became a party to a $2,600 bridge facility (the Bridge Facility). The Bridge Facility serves as a backstop to certain contemplated financing transactions associated with Dana's intended acquisition of Eaton's Mobility business. See Note 1 of our consolidated financial statements in Item 1 of Part I for additional information. The Bridge Facility may be drawn upon only if the acquisition transaction closes. Availability under the Bridge Facility is subject to reduction to the extent contemplated financing transactions are completed prior to the acquisition transaction closing. See Note 10 of our consolidated financial statements in Item 1 of Part I for additional information.
On July 1, 2026, we issued notices of conditional full redemption with a redemption date of July 31, 2026, for all of our outstanding July 2031 Notes at a redemption price equal to 104.25% plus accrued and unpaid interest. On July 10, 2026, we amended our credit and guaranty agreement to include a $500 Term A Facility. Borrowings under the Term A Facility bear interest at a floating rate based on Term Secured Overnight Financing Rate (SOFR) (as described in the credit agreement) plus a margin. The Term A Facility matures 364 days from the date of the first draw on the Term A Facility. We are required to make quarterly installments on the Term A Facility on the last day of each quarter commencing on December 31, 2026 in an amount equal to 10% of the original amount borrowed adjusted for any prepayments. On July 28, 2026, we fully drew the Term A Facility. On July 31, 2026, we redeemed all of our outstanding July 2031 Notes.
The principal sources of liquidity available for our future cash requirements are expected to be (i) cash flows from operations, (ii) cash and cash equivalents on hand and (iii) borrowings from our Revolving Facility. We believe that our overall liquidity and operating cash flow will be sufficient to meet our anticipated cash requirements for capital expenditures, working capital, debt obligations and other commitments during the next twelve months. While uncertainty surrounding the current economic environment could adversely impact our business, based on our current financial position, we believe it is unlikely that any such effects would preclude us from maintaining sufficient liquidity.
Cash Flow
The following table summarizes our consolidated statement of cash flows:
| Six Months Ended |
||||||||
| June 30, |
||||||||
| 2026 |
2025 |
|||||||
| Net cash used in operating activities |
$ | (86 | ) | $ | (5 | ) | ||
| Net cash provided by (used in) investing activities |
2,321 | (60 | ) | |||||
| Net cash provided by (used in) financing activities |
(2,368 | ) | 1 | |||||
| Net decrease in cash, cash equivalents and restricted cash |
$ | (133 | ) | $ | (64 | ) | ||
Operating activities — Exclusive of working capital, other cash provided by continuing operations was $211 in 2026 and $171 in 2025. The year-over-year improvement is primarily attributable to the impact of higher year-over-year operating earnings from continuing operations. Continuing operations working capital used cash of $221 and $202 in 2026 and 2025, respectively. Cash of $321 and $134 was used to finance receivables in 2026 and 2025, respectively. Cash of $32 and $48 was provided by lower inventory levels in 2026 and 2025, respectively. Increases in accounts payable and other net liabilities provided cash of $68 in 2026, while decreases in accounts payable and other net liabilities used cash of $116 in 2025. The Off-Highway business sale transaction closed on January 1, 2026. The Off-Highway business's Mexican operations continue to be presented as discontinued operations, as those operations have not yet legally transferred to the buyer. Operating activities of discontinued operations used cash of $76 in 2026 and generated cash of $26 in 2025. The use of cash in 2026 is primarily due cash paid for Off-Highway related divestiture activities.
Investing activities — Expenditures for property, plant and equipment by continuing operations were $204 and $104 in 2026 and 2025, respectively. The elevated level of capital spending in 2026 is primarily due to the purchase of three U.S. manufacturing facilities that were previously leased. Investing activities of discontinued operations provided cash of $2,528 in 2026 and used cash of $22 in 2025. The Off-Highway business sale transaction closed on January 1, 2026, with only the Off-Highway business's Mexican operations continuing to be presented as discontinued operations, as those operations have not yet legally transferred to the buyer. We received net cash proceeds of $2,529 during 2026 on the sale of the Off-Highway business to Allison.
Financing activities — During 2026, we had net payments on our Revolving Facility of $390 and we repaid the $225 outstanding balance on the Term A Facility. During 2025, we had net borrowings on our Revolving Facility of $525. During 2026, we purchased $138 of our November 2027 Notes, $142 of our June 2028 Notes, €141 of our July 2029 Notes ($164 as of January 7, 2026), $173 of our September 2030 Notes, €9 of our July 2031 Notes ($10 as of January 7, 2026) and $152 of our February 2032 Notes. Also during 2026, we redeemed $262 of our November 2027 Notes and $258 of our June 2028 Notes. During 2025, we redeemed the remaining $200 of our April 2025 Notes. We used cash of $26 and $29 for dividend payments to common stockholders during 2026 and 2025, respectively. We used cash of $169 and $257 to repurchase 5,664,914 common shares and 14,607,283 common shares under our share repurchase during 2026 and 2025, respectively. Distributions to noncontrolling interests totaled $2 and $3 in 2026 and 2025, respectively. During 2026, we paid Hydro-Québec $190 to acquire their 45% mandatorily redeemable noncontrolling interests in Dana TM4 Inc., Dana TM4 Electric Holdings BV and Dana TM4 USA, LLC.
Off-Balance Sheet Arrangements
There have been no material changes at June 30, 2026 in our off-balance sheet arrangements from those reported or estimated in the disclosures in Item 7 of our 2025 Form 10-K.
Contractual Obligations
During the second quarter of 2026, the Company modified an operating lease, resulting in a reassessment and reclassification of the lease as a finance lease. At the modification date, the carrying amounts of the operating lease right-of-use asset and lease liability were $62 million and $57 million, respectively. Following remeasurement, the Company recognized a finance lease right-of-use asset of $103 million and a finance lease liability of $98 million.
There have been no other material changes in our contractual obligations from those disclosed in Item 7 of our 2025 From 10-K.
Contingencies
For a summary of litigation and other contingencies, see Note 12 to our consolidated financial statements in Item 1 of Part I. Based on information available to us at the present time, we do not believe that any liabilities beyond the amounts already accrued that may result from these contingencies will have a material adverse effect on our liquidity, financial condition or results of operations.
Critical Accounting Estimates
The preparation of our consolidated financial statements in accordance with GAAP requires us to use estimates and make judgments and assumptions about future events that affect the reported amounts of assets, liabilities, revenue and expenses and the related disclosures. See Item 7 in our 2025 Form 10-K for a description of our critical accounting estimates and Note 1 to our consolidated financial statements in Item 8 of our 2025 Form 10-K for our significant accounting policies. There were no changes to our critical accounting estimates in the six months ended June 30, 2026. See Note 1 to our consolidated financial statements in this Form 10-Q for a discussion of new accounting guidance adopted during the first six months of 2026.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
There have been no material changes to market risk exposures related to changes in currency exchange rates, interest rates or commodity costs from those discussed in Item 7A of our 2025 Form 10-K.
Item 4. Controls and Procedures
Disclosure controls and procedures — We maintain disclosure controls and procedures that are designed to ensure that the information disclosed in the reports we file with the SEC under the Securities Exchange Act of 1934, as amended (the Exchange Act), is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer (CEO) and Chief Financial Officer (CFO), as appropriate, to allow timely decisions regarding required disclosure.
Our management, with the participation of our CEO and CFO, has evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this Quarterly Report on Form 10-Q. Our CEO and CFO have concluded that, as of the end of the period covered by this Quarterly Report on Form 10-Q, our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were effective.
Changes in internal control over financial reporting — There was no change in our internal control over financial reporting that occurred during our fiscal quarter ended June 30, 2026 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
CEO and CFO certifications — The certifications of our CEO and CFO that are attached to this report as Exhibits 31.1 and 31.2 include information about our disclosure controls and procedures and internal control over financial reporting. These certifications should be read in conjunction with the information contained in this Item 4 and in Item 9A of Part II of our 2025 Form 10-K for a more complete understanding of the matters covered by the certifications.
PART II – OTHER INFORMATION
Item 1. Legal Proceedings
We are a party to various pending judicial and administrative proceedings that arose in the ordinary course of business. After reviewing the currently pending lawsuits and proceedings (including the probable outcomes, reasonably anticipated costs and expenses and our established reserves for uninsured liabilities), we do not believe that any liabilities that may result from these proceedings are reasonably likely to have a material adverse effect on our liquidity, financial condition or results of operations. Legal proceedings are also discussed in Note 12 to our consolidated financial statements in Item 1 of Part I of this Form 10-Q.
Item 1A. Risk Factors
There have been no material changes in our risk factors disclosed in Item 1A of our 2025 Form 10-K.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Issuer's purchases of equity securities — On June 8, 2025 our Board of Directors approved a stock repurchase program of up to an aggregate of $1,000 less any amount of special dividends distributed in connection with the sale of the Off-Highway business. The program expires on December 31, 2027. On February 11, 2026, our Board of Directors increased and extended the share repurchase program to a total of $2,000 through December 31, 2030. The following table summarizes our purchases of common stock during the second quarter of 2026.
| Period |
Number of Shares Purchased |
Average Price Paid per Share |
Number of Shares Purchased as Part of Publicly Announced Plans or Programs |
Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs |
||||||||||||
| April 1 - April 30, 2026 |
579,860 | $ | 36.23 | 579,860 | $ | 1,204 | ||||||||||
| May 1 - May 31, 2026 |
577,285 | $ | 34.54 | 577,285 | $ | 1,184 | ||||||||||
| June 1 - June 30, 2026 |
83,713 | $ | 35.86 | 83,713 | $ | 1,181 | ||||||||||
Item 5. Other Information
During the three months ended June 30, 2026, none of the Company’s directors or executive officers adopted or terminated any contract, instruction or written plan for the purchase or sale of Company securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement".
Item 6. Exhibits
| Exhibit No. |
Description |
| 2.1 | Separation and Distribution Agreement, dated as of June 10, 2026, by and among Eaton Corporation plc, Eaton Corporation, Eaton Capital Unlimited Company, Mobility (USA) Corporation and Dana Incorporated, and incorporated herein by reference. |
| 2.2 | Agreement and Plan of Merger, dated as of June 10, 2026, by and among Eaton Corporation plc, Eaton Corporation, Mobility (USA) Corporation, Atlas Mobility Sub, Inc. and Dana Incorporated, and incorporated herein by reference. |
| 10.1 | Letter Agreement between Dana Incorporated and Byron S. Foster, dated June 11, 2026, and incorporated herein by reference. |
| 10.2 | Letter Agreement between Dana Incorporated and R. Bruce McDonald, dated June 11, 2026, and incorporated herein by reference. |
| 10.3 | Amendment No. 8 to Credit and Guaranty Agreement, dated as of July 10, 2026, among Dana Incorporated, the guarantors party thereto, Citibank, N.A., as administrative agent and collateral agent, and the lenders party thereto, and incorporated herein by reference. |
| 31.1 |
Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer. Filed with this Report. |
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| 31.2 |
Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer. Filed with this Report. |
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| 32 |
Section 1350 Certifications (pursuant to Section 906 of the Sarbanes-Oxley Act of 2002). Filed with this Report. |
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| 101 |
The following materials from Dana Incorporated’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2026, formatted in iXBRL (Inline Extensible Business Reporting Language): (i) the Consolidated Statement of Operations, (ii) the Consolidated Statement of Comprehensive Income, (iii) the Consolidated Balance Sheet, (iv) the Consolidated Statement of Cash Flows and (v) Notes to the Consolidated Financial Statements. Furnished with this Report. |
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| 104 |
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
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DANA INCORPORATED |
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| Date: |
August 6, 2026 |
By: |
/s/ Timothy R. Kraus |
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Timothy R. Kraus |
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Executive Vice President and |
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Chief Financial Officer |
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