What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2025-11-18 compared with 2024-11-18 · 353 added, 254 removed, 1200 unchanged (34% of the section changed)

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We believe that our audits provide a reasonable basis for our opinions.

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Definition and Limitations of Internal Control over Financial Reporting

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A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

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and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

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The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Annual Goodwill Impairment Assessment

As described in Notes 1, 6 and 17 to the consolidated financial statements, the Company’s goodwill balance, which is comprised of the Americas, Europe, the Middle East and Africa (EMEA), and Asia Pacific/China (Asia) reporting units (collectively, “the reporting units”), was $2,164 million as of September 30, 2024.

Interim and Annual Goodwill Impairment Assessments

As described in Notes 1 and 6 to the consolidated financial statements, the Company’s goodwill balance was $1,807 million as of September 30, 2025, and the goodwill associated with the Americas, Europe, the Middle East and Africa (EMEA), and Asia Pacific/China (Asia) reporting units (collectively, “the reporting units”) was $607 million, $0, and $1,200 million, respectively.

Management reviews goodwill for impairment during the fourth fiscal quarter or more frequently if events or changes in circumstances indicate the asset might be impaired.

Fair value of the reporting units is estimated using an income approach utilizing discounted cash flow analyses.

The estimated future cash flows reflect management’s latest assumptions of the financial projections based on current and anticipated competitive landscape, including estimates of revenue based on production volumes over the foreseeable future and long-term growth rates, and operating margins based on historical trends and future cost containment activities, as well as the discount rates.

The principal considerations for our determination that performing procedures relating to the annual goodwill impairment assessment is a critical audit matter are (i) the significant judgment by management when developing the fair value estimate of the reporting units;

(ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to estimates of operating margins for the Americas reporting unit, estimates of revenue, long-term growth rate, and operating margins, as well as the discount rate for the EMEA reporting unit, and estimates of revenue for the Asia reporting unit;

The estimated fair value is compared with the carrying amount of the reporting unit, including recorded goodwill.

During the second quarter of fiscal 2025, management identified a triggering event requiring a quantitative impairment analysis, and as a result, a $333 million non-cash goodwill impairment was recorded in the EMEA reporting unit.

In estimating the fair value, management primarily uses an income approach utilizing discounted cash flow analyses.

The calculations contain uncertainties as they require management to make assumptions about future cash flows and the appropriate discount rates.

The estimated future cash flows reflect management’s updated assumptions of the financial projections based on anticipated competitive landscape, including estimates of revenue based on production volumes over the foreseeable future and long-term growth rates, and operating margins based on historical trends and future cost containment activities.

The principal considerations for our determination that performing procedures relating to the interim goodwill impairment assessment of the EMEA reporting unit and the annual goodwill impairment assessments of the Americas and Asia reporting units is a critical audit matter are (i) the significant judgment by management when developing the fair value estimate of the reporting units;

(ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to (a) estimates of revenue, the long-term growth rate, and operating margins, as well as the discount rate for the interim goodwill impairment assessment of the EMEA reporting unit, (b) estimates of operating margins for the annual goodwill impairment assessment of the Americas reporting unit, and (c) estimates of revenue for the annual goodwill impairment assessment of the Asia reporting unit;

and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to management’s goodwill impairment assessment, including controls over the valuation of the Company’s reporting units.

These procedures included testing the effectiveness of controls relating to management’s interim and annual goodwill impairment assessments, including controls over the valuation of the Company’s reporting units.

These procedures also included, among others (i) testing management’s process for developing the fair value estimate of the reporting units;

(ii) evaluating the appropriateness of the discounted cash flow analyses;

(iii) testing the completeness and accuracy of underlying data used by management in the discounted cash flow analyses;

and (iv) evaluating the reasonableness of the significant assumptions used by management related to estimates of operating margins for the Americas reporting unit, estimates of revenue, long-term growth rate, and operating margins, as well as the discount rate for the EMEA reporting unit, and estimates of revenue for the Asia reporting unit.

Evaluating management’s assumptions related to estimates of revenue, long-term growth rate, and operating margins involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the reporting units, as applicable;

(ii) evaluating the appropriateness of the discounted cash flow analyses used by management;

(iii) testing the completeness and accuracy of underlying data used in the discounted cash flow analyses;

and (iv) evaluating the reasonableness of the significant assumptions used by management related to (a) estimates of revenue, the long-term growth rate, and operating margins, as well as the discount rate for the interim goodwill impairment assessment of the EMEA reporting unit, (b) estimates of operating margins for the annual goodwill impairment assessment of the Americas reporting unit, and (c) estimates of revenue for the annual goodwill impairment assessment of the Asia reporting unit.

Evaluating management’s assumptions related to estimates of revenue and operating margins involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the reporting units;

(ii) the consistency with relevant industry data;

and (iii) whether these assumptions were consistent with evidence obtained in other areas of the audit.

Professionals with specialized skill and knowledge were used to assist in evaluating the appropriateness of the discounted cash flow analyses and the reasonableness of the long-term growth rate and discount rate assumptions.

and (iii) whether the assumptions were consistent with evidence obtained in other areas of the audit.

Professionals with specialized skill and knowledge were used to assist in evaluating (i) the appropriateness of the discounted cash flow analyses and (ii) the reasonableness of the estimate of the long-term growth rate and the discount rate assumptions for the interim goodwill impairment assessment of the EMEA reporting unit.

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Net financing charges 193 189 195

Other pension expense (income) 21 33 ( 10 )

Income before income taxes 133 295 54

Other pension expense 10 21 33

Income (loss) before income taxes ( 88 ) 133 295

Income tax provision 103 32 —

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Net income (loss) attributable to Adient $ ( 281 ) $ 18 $ 205

Earnings per share:

Earnings (Loss) per share:

Basic $ ( 3.39 ) $ 0.20 $ 2.17

Diluted $ ( 3.39 ) $ 0.20 $ 2.15

Shares used in computing earnings per share:

Shares used in computing earnings (loss) per share:

Basic 83.0 89.5 94.5

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Net income (loss) $ ( 191 ) $ 101 $ 295

Other comprehensive income (loss), net of tax:

Other comprehensive income, net of tax:

Foreign currency translation adjustments ( 14 ) 204 ( 17 )

Realized and unrealized gains (losses) on derivatives 37 ( 32 ) 21

Pension and postretirement plans — — 1

Other comprehensive income (loss) 172 4 ( 249 )

Other comprehensive income 23 172 4

Total comprehensive income (loss) ( 168 ) 273 299

Comprehensive income (loss) attributable to noncontrolling interests 106 91 49

Comprehensive income attributable to noncontrolling interests 88 106 91

Comprehensive income (loss) attributable to Adient $ ( 256 ) $ 167 $ 208

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Amortization of intangibles 46 47 50

Pension and postretirement benefit expense (benefit) 27 38 ( 2 )

Pension and postretirement contributions, net ( 20 ) ( 17 ) ( 16 )

Pension benefit expense 16 27 38

Pension contributions, net ( 18 ) ( 20 ) ( 17 )

Equity in earnings of partially-owned affiliates, net of dividends received 36 ( 17 ) ( 34 )

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Premium paid on repurchase of debt — — 7

Retrospective recoveries of Brazil indirect tax credits — — ( 29 )

Derivative loss on the 2021 Yanfeng Transaction — — 3

Deferred income taxes ( 28 ) ( 1 ) ( 124 )

Non-cash restructuring and impairment charges 9 — 14

Non-cash impairment charges 341 9 —

Equity-based compensation 32 31 34

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Sale of property, plant and equipment 34 15 26

Settlement of derivative contracts — — ( 30 )

Acquisition of businesses, net of cash acquired — — ( 6 )

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Continued on next page

The accompanying notes are an integral part of the consolidated financial statements.

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Balance at September 30, 2022 $ — $ 4,026 $ ( 1,108 ) $ ( 845 ) $ 2,073 $ 302 $ 2,375

Net income (loss) — — ( 120 ) — ( 120 ) 45 ( 75 )

Net income — — 205 — 205 63 268

Foreign currency translation adjustments — — — ( 18 ) ( 18 ) ( 2 ) ( 20 )

Employee retirement plans — — — 1 1 — 1

Realized and unrealized gains on derivatives — — — 21 21 — 21

Dividends paid to and other transactions with noncontrolling interests — — — — — ( 45 ) ( 45 )

Purchase of subsidiary shares from noncontrolling interest — 12 — — 12 ( 12 ) —

Repurchase and retirement of ordinary shares — ( 65 ) — — ( 65 ) — ( 65 )

Share based compensation and other — 12 — — 12 — 12

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Foreign currency translation adjustments — — — 181 181 6 187

Realized and unrealized gains on derivatives — — — 21 21 — 21

Realized and unrealized losses on derivatives — — — ( 32 ) ( 32 ) — ( 32 )

Dividends paid to and other transactions with noncontrolling interests — — — — — ( 60 ) ( 60 )

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Balance at September 30, 2024 $ — $ 3,712 $ ( 885 ) $ ( 693 ) $ 2,134 $ 309 $ 2,443

Net income — — 18 — 18 45 63

Net income (loss) — — ( 281 ) — ( 281 ) 54 ( 227 )

Foreign currency translation adjustments — — — ( 12 ) ( 12 ) ( 1 ) ( 13 )

Realized and unrealized losses on derivatives — — — ( 32 ) ( 32 ) — ( 32 )

Realized and unrealized gains on derivatives — — — 37 37 — 37

Dividends paid to and other transactions with noncontrolling interests — — — — — ( 46 ) ( 46 )

Purchase of noncontrolling interest — ( 7 ) — ( 2 ) ( 9 ) ( 19 ) ( 28 )

Repurchase and retirement of ordinary shares — ( 125 ) — — ( 125 ) — ( 125 )

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Sales or discounts of accounts receivable are reflected as a reduction of accounts receivable on the consolidated statements of financial position and the proceeds are included in cash flows from operating activities in the consolidated statements of cash flows.

As of both September 30, 2024 and 2023, $ 170 million was funded under these programs.

As of September 30, 2025 and 2024, $ 185 million and $ 170 million was funded under these programs, respectively.

Inventories are stated at the lower of cost or net realizable value.

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Adient's policy for engineering, research and development, and other design and development costs related to products that will be sold under long-term supply arrangements requires such costs to be expensed as incurred or capitalized if reimbursement from the customer is contractually assured.

Income related to recovery of these costs is recorded within selling, general and administrative expense in the consolidated statements of income.

Income related to recovery of these costs is recorded within selling, general and administrative expense in the consolidated statements of income (loss).

At September 30, 2025 and 2024, Adient recorded within the consolidated statements of financial position $ 365 million and $ 310 million, respectively, of engineering and research and development costs for which customer reimbursement is contractually assured.

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An impairment is recorded to the extent the estimated fair value is below the carrying amount of the reporting unit.

No goodwill impairment has been recorded in fiscal 2024, 2023 or 2022.

As a result of macroeconomic factors impacting Adient and the automotive industry, a heightened risk of impairment exists for the EMEA reporting unit as the difference between its fair value and carrying value is less than 10% as of September 30, 2024.

The decrease in EMEA’s fair value is driven by lower forecasted vehicle volumes from weakening consumer demand, slower consumer adoption of electric vehicles, overcapacity in the industry resulting in pricing pressure, intensifying competition from Chinese imports and lower exports to China from EMEA as domestic brands expand in China.

As a result of the heightened risk of impairment, Adient will continuously assess the changing macroeconomic conditions in EMEA including the outlook for consumer demand for vehicles and other factors impacting the region, along with the need for further restructuring actions, all of which impact Adient’s ability to achieve its projected long-term operating performance.

Refer to Note 6, “Goodwill and Other Intangible Assets,” of the notes to the consolidated financial statements for additional information.

Intangible assets with definite lives are amortized over their estimated useful lives and are subject to impairment testing if events or changes in circumstances indicate that the asset might be impaired.

Refer to Note 6, “Goodwill and Other Intangible Assets,” of the notes to the consolidated financial statements for more information regarding Adient’s goodwill and other intangible assets.

Impairment of Long-Lived Assets

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If the undiscounted cash flows do not indicate the carrying amount of the asset is recoverable, an impairment charge is measured as the amount by which the carrying amount of the asset group exceeds its fair value based on discounted cash flow analysis or appraisals.

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Impairment of Investments in Partially-Owned Affiliates

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Refer to Note 18, “Nonconsolidated Partially-Owned Affiliates,” of the notes to consolidated financial statements for more information on Adient’s partially-owned affiliates.

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Revenue Recognition

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Essentially all of Adient’s sales are to the automotive industry.

Volkswagen Group comprised 13 % and 11 % of consolidated net sales in fiscal 2024 and 2023, respectively, primarily within the EMEA segment.

Ford Motor Company comprised 11 %, 12 % and 11 % of consolidated net sales in fiscal 2025, 2024 and 2023, respectively, across all segments.

Volkswagen Group comprised 10 %, 13 % and 11 % of consolidated net sales in fiscal 2025, 2024 and 2023, respectively, primarily within the EMEA segment.

Stellantis N.V.

comprised 10 % and 12 % of consolidated net sales in fiscal 2023 and 2022, respectively, primarily within the Americas segment.

comprised 10 % of consolidated net sales in fiscal 2025 and 2023 within the Americas and EMEA segments.

Research and Development Costs

Expenditures for research activities relating to product development and improvement (other than those expenditures that are contractually guaranteed for reimbursement from the customer) are charged against income as incurred and included within selling, general and administrative expenses in the consolidated statements of income.

Such expenditures for the years ended September 30, 2025, 2024 and 2023 were $ 387 million, $ 372 million and $ 362 million, respectively.

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Such assistance is initially recorded as a reduction to property, plant and equipment.

Once in use, the balance is systematically recognized in the statements of income as the asset is depreciated over the useful life of the underlying asset.

Once in use, the balance is systematically recognized in the statements of income (loss) as the asset is depreciated over the useful life of the underlying asset.

Adient also periodically receives government assistance for creating new job opportunities and maintaining a certain number of employees.

Such employment-related incentives are normally deferred as current or noncurrent liabilities as appropriate.

These benefits are recognized in the statements of income as a reduction of expense when Adient has met or is expected to meet all related contractual obligations.

These benefits are recognized in the statements of income (loss) as a reduction of expense when Adient has met or is expected to meet all related contractual obligations.

The impact of government assistance received by Adient and related balances for all periods presented were immaterial.

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Monetary assets and liabilities denominated in non-functional currencies are adjusted to reflect period-end exchange rates.

The resulting translation adjustments are accumulated as a component of AOCI.

The aggregate transaction gains (losses) included in net income for the years ended September 30, 2024, 2023 and 2022 were $( 3 ) million, $ 4 million and $ 6 million, respectively.

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The resulting translation adjustments are accumulated as a component of accumulated other comprehensive income (“AOCI”).

The aggregate transaction gains (losses) included in net income (loss) for the years ended September 30, 2025, 2024 and 2023 were $( 8 ) million, $( 3 ) million and $ 4 million, respectively.

Derivative Financial Instruments

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Refer to Note 10, “Derivative Instruments and Hedging Activities,” and Note 11, “Fair Value Measurements,” of the notes to consolidated financial statements for disclosure of Adient's derivative instruments and hedging activities.

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Restructuring Costs

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In these situations, the affected employees are identified and it is unlikely that actions required to complete the separation plan will change significantly.

Costs associated with benefits that are contingent on the employee continuing to provide services are recorded over the required service period.

All other costs associated with restructuring activities are expensed as incurred.

These costs are included in restructuring and impairment costs in the consolidated statements of income (loss).

Refer to Note 15, “Restructuring and Impairment Costs,” of the notes to the consolidated financial statements for more information.

Costs associated with benefits that are contingent on certain employees continuing to provide services during a transition period are recorded over the required service period.

All other costs associated with restructuring activities, such as costs to relocate machinery and equipment and costs to finalize the closing of a plant or dissolving a legal entity after production has ceased, are expensed as incurred.

Refer to Note 17, “Segment Information,” of the notes to the consolidated financial statements for more information.

Stock-Based Compensation

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Refer to Note 12, “Stock-Based Compensation,” of the notes to consolidated financial statements for Adient's stock based compensation disclosures.

Pension and Postretirement Benefits

Adient utilizes a mark-to-market approach for recognizing pension and postretirement benefit expenses, including measuring the market related value of plan assets at fair value and recognizing actuarial gains and losses in the fourth quarter of each fiscal year or at the date of a remeasurement event.

Refer to Note 14, “Retirement Plans,” of the notes to consolidated financial statements for disclosure of Adient's pension and postretirement benefit plans.

Pension Benefits

Adient utilizes a mark-to-market approach for recognizing pension benefit expenses, including measuring the market related value of plan assets at fair value and recognizing actuarial gains and losses in the fourth quarter of each fiscal year or at the date of a remeasurement event.

Refer to Note 14, “Retirement Plans,” of the notes to consolidated financial statements for disclosure of Adient's pension benefit plans.

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and other loss carryforwards.

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Earnings Per Share

The following table shows the computation of basic and diluted earnings per share:

The following table shows the computation of basic and diluted earnings (loss) per share:

September 30,

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Diluted shares 83.0 90.1 95.4

Earnings per share:

Earnings (Loss) per share:

Basic $ ( 3.39 ) $ 0.20 $ 2.17

Diluted $ ( 3.39 ) $ 0.20 $ 2.15

The effect of common stock equivalents which would have been anti-dilutive was excluded from the calculation of diluted earnings per share for fiscal 2024 and 2023 and was immaterial.

Potentially dilutive securities whose effect would have been antidilutive are excluded from the computation of diluted earnings per share for fiscal 2022 which is a result of being in a loss position.

Potentially dilutive securities are excluded from the computation of diluted earnings (loss) per share for fiscal 2025 as the effect would have been anti-dilutive due to being in a loss position.

The effect of common stock equivalents which would have been anti-dilutive was excluded from the calculation of diluted earnings (loss) per share for fiscal 2024 and 2023 and was immaterial.

New Accounting Pronouncements

Standards Adopted During Fiscal 2025

On October 1, 2023, Adient adopted Accounting Standards Codification (“ASU”) 2022-04, Liabilities - Supplier Finance Programs (Subtopic 405-50):

Disclosure of Supplier Finance Program Obligations , which requires disclosures of key terms of Adient's material supplier finance program.

Refer to Note 9, "Debt and Financing Arrangements," of the notes to consolidated financial statements for additional information.

Standards Effective After Fiscal 2024

Adient has considered the new standards that are summarized below, each to be effective after fiscal 2024:

On October 1, 2024, Adient adopted Accounting Standards Codification (“ASU”) 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures which requires additional disclosures on significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss (collectively referred to as the “significant expense principle”).

The ASU also requires additional disclosures of an amount for other segment items by reportable segment and a description of its composition.

The new guidance is applied retrospectively in Adient's fiscal 2025 annual filing on Form 10-K and in subsequent quarterly filings on Form 10-Q.

The adoption of this guidance has resulted in incremental segment information disclosures within the footnotes to the consolidated financial statements but did not have an impact on Adient’s financial position and results of operations.

Refer to Note 17, “Segment Information” of the notes to consolidated financial statements for additional information.

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Standards Effective After Fiscal 2025

Adient has considered the new standards that are summarized below, each to be effective after fiscal 2025, which are not expected to significantly impact the consolidated financial statements:

Standard to be Adopted Description Date Effective

ASU 2023-07 Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures The ASU requires additional disclosures on significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss (collectively referred to as the “significant expense principle”).

The ASU also requires additional disclosures of an amount for other segment items by reportable segment and a description of its composition.

October 1, 2024

ASU 2023-09 Income Taxes (Topic 740):

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October 1, 2025

SEC Climate Disclosure Rules

Final Rule 33-11275 In March 2024, the SEC adopted the final rule surrounding disclosures of the impacts and risks of climate-related matters that have a material impact on Adient's operations and consolidated financial statements.

These disclosures would be required in annual reports and registration statements and would discuss Scope 1 and Scope 2 greenhouse gas emissions along with other climate-related information such as severe weather events and other natural conditions.

In April 2024, the SEC voluntarily stayed the climate disclosure rules pending judicial review.

Adient is monitoring the outcome and evaluating the impact of these rules on its consolidated financial statements and related disclosures.

October 1, 2025 (under final rules which are now stayed)

ASU 2025-05 Measurement of Credit Losses for Accounts

Receivable and Contract Assets (Financial Instruments – Credit Losses (Topic 326) The ASU provides a practical expedient and an accounting policy election under which conditions at the period-end date can be assumed to remain unchanged for an asset’s remaining life when estimating credit losses on current accounts receivable and current contract assets arising from transactions under ASC 606 Revenue from contracts with customers.

The update is expected to simplify the credit loss assessment when applying Topic 326.

October 1, 2026

ASU 2024-03 Income Statement - Reporting Comprehensive

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October 1, 2027

ASU 2025-06 Intangibles - Goodwill and Other-Internal-Use Software (Subtopic 350-40):

Targeted Improvements to the Accounting for Internal-Use Software The ASU amends the timing for capitalizing eligible internal use software costs.

Under the new guidance, an entity is required to start capitalizing software costs when both of the following occur:

1) Management has authorized and committed to funding the software project.

2) It is probable that the project will be completed and the software will be used to perform the function intended (referred to as the “probable-to-complete recognition threshold”).

The ASU does not change the types of costs eligible for capitalization or the associated amortization and impairment guidance.

October 1, 2028

Revenue Recognition

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The amount of revenue recognized reflects the consideration that Adient expects to be entitled to in exchange for such products based on purchase orders, annual price reductions and ongoing price adjustments (some of which are accounted for as variable consideration and subject to being constrained), net of the impact, if any, of consideration paid to the customer.

Approximately 1 % of net sales recorded in fiscal 2024 were related to product sales transacted in prior fiscal years.

Approximately 1 % of net sales recorded in each of the last three fiscal years were related to product sales transacted in prior fiscal years.

In pursuit of new program awards, Adient at times agrees to make upfront payments to customers.

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Certain upfront payments, however, are capitalized as other current and noncurrent assets if they are determined to be incremental, attributable only to the specific new program being awarded, and recoverable.

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As products under the new program are sold to the customer, the capitalized amount is amortized and recognized as a reduction to revenue over the term of the program, typically between three and seven years .

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Any amounts that are concluded to be no longer recoverable are immediately recognized as a reduction to revenue.

As of September 30, 2024 and 2023, Adient maintained capitalized upfront payments of

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$ 155 million and $ 126 million, respectively, within other noncurrent assets.

As of September 30, 2025 and 2024, Adient maintained capitalized upfront payments of $ 174 million and $ 155 million, respectively, within other noncurrent assets.

In a typical arrangement with the customer, purchase orders are issued for pre-production activities which consist of engineering, design and development, tooling and prototypes for the manufacture and delivery of component parts.

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Contract liabilities primarily relate to contracts where advance payments or deposits have been received, but performance obligations have not yet been satisfied and revenue has not been recognized.

No material contract assets or liabilities exist at September 30, 2024.

No material contract assets or liabilities exist at September 30, 2025 and 2024.

As described above, the issuance of a purchase order and/or a materials release by the customer represents the point at which an enforceable contract with the customer exists.

Therefore, Adient has elected to apply the practical expedient in ASC 606, paragraph 606-10-50-14 and does not disclose information about the remaining performance obligations that have an original expected duration of one year or less.

Therefore, Adient has elected to apply the practical expedient in ASC 606 and does not disclose information about the remaining performance obligations that have an original expected duration of one year or less.

Refer to Note 17, “Segment Information,” of the notes to consolidated financial statements for disaggregated revenue by geographical market.

1 unchanged sentence

2025 Transaction

During the first quarter of fiscal 2025, Adient acquired all of the noncontrolling interest in Technotrim, Inc.

(“Technotrim”) for a value of $ 28 million and sold all of its partially-owned interests in Setex, Inc.

and Setex SRL (together as “Setex”) for a value of $ 27 million.

The sale of Setex resulted in a one-time gain of $ 4 million.

The acquisition of all noncontrolling interest in Technotrim was recorded to equity.

The transactions are expected to provide additional synergies through optimization of Adient's manufacturing footprint and additional control over its manufacturing presence in the Americas.

2024 Transaction

In November 2023, Adient finalized the sale of 51 % of its interest (previously held 100 %) in Adient (Langfang) Seating Co., Ltd.

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(“KEIPER”), in April 2023 for ¥ 150 million ($ 23 million).

Adient made an initial deposit of ¥ 75 million ($ 12 million) in fiscal 2022, which represents 50 % of the purchase price (reflected within other current assets as of September 30, 2022).

Adient made an initial deposit of ¥ 75 million ($ 12 million) in fiscal 2022, which represents 50 % of the purchase price.

During fiscal 2023, Adient paid the remaining purchase price of ¥ 75 million ($ 11 million).

The acquisition was accounted for using the acquisition method, and the operating results and cash flows of YFAT are included in Adient's consolidated financial statements starting from May 2023.

The acquisition is expected to provide additional synergies within the Asia segment.

The acquisition has provided additional synergies within the Asia segment.

Adient recorded a purchase price allocation for the assets acquired and liabilities assumed based on their fair values as of the April 2023 acquisition date, which included $ 13 million of goodwill and $ 5 million of acquired cash.

The allocation of the purchase price is based on the valuations performed to determine the fair value of the net assets as of the acquisition date.

If the acquisition of YFAT had occurred on October 1, 2021, its impact on Adient's net sales and net income attributable to Adient for fiscal 2022 and fiscal 2023 would have been immaterial.

Upon acquisition, YFAT was renamed as Adient (Nantong) Automotive Seating Components Co., Ltd.

2022 Transactions

In conjunction with the 2021 and 2020 Yanfeng Transactions (as defined and described in Form 10-K for the fiscal year ended September 30, 2021), Adient received total proceeds of $ 693 million during fiscal 2022 from sales of its interests in two nonconsolidated partially-owned affiliates in China.

Assets held for sale

During fiscal 2022, Adient committed to sell certain assets in EMEA.

As a result, these assets were classified as assets held for sale and were required to be adjusted to the lower of fair value less cost to sell or carrying value, which resulted in an impairment charge of $ 6 million.

Also, the sale of certain operations in EMEA which were classified as held for sale in fiscal 2021 was completed in fiscal 2022 for total proceeds of $ 46 million.

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Balance at September 30, 2024 $ 606 $ 341 $ 1,217 $ 2,164

Business divestiture — — ( 5 ) ( 5 )

Impairments — ( 333 ) — ( 333 )

Currency translation and other 1 ( 8 ) ( 17 ) ( 24 )

1 unchanged sentence

Refer to Note 3, “Acquisitions and Divestitures,” of the notes to consolidated financial statements for additional information.

Adient performed its annual goodwill impairment test during the fourth quarter of fiscal year 2024 using a fair value method based on management's judgments and assumptions regarding future cash flows.

These calculations contain uncertainties as they require management to make assumptions about market comparables, future cash flows, and the appropriate discount rates

During the second quarter of fiscal 2025, Adient identified a triggering event requiring a quantitative impairment analysis primarily due to the continued and sustained decline in the market value of its ordinary shares resulting from the uncertainties surrounding future production volume within the automotive industry.

These uncertainties were the result of a combination of

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(based on weighted average cost of capital ranging from 15.5 % to 18.5 %) to reflect the risk inherent in the future cash flows and to derive a reasonable enterprise value and related premium.

The estimated future cash flows reflect management's latest assumptions of the financial projections based on current and anticipated competitive landscape, including estimates of revenue based on production volumes over the foreseeable future and long-term growth rates, and operating margins based on historical trends and future cost containment activities.

The financial projections considered the impact of the various issues causing uncertainty in the automotive industry such as weaker vehicle demand impacted by new vehicle affordability and a high interest rate environment, slower global adoption of electric vehicles by consumers, volatile commodity pricing, and persistent inflationary pressures.

Specifically in the EMEA region, where Adient recorded significant restructuring charges during fiscal 2024, a heightened risk of impairment exists as the difference between its fair value and carrying value is less than 10%.

The EMEA reporting unit maintains $ 341 million of goodwill at September 30, 2024.

No goodwill impairment was recorded in fiscal 2024;

however, if further degradation in the economic conditions in the EMEA region occur or if significantly higher levels of restructuring actions are needed in the region, the EMEA reporting unit may incur significant impairment of goodwill and other long-lived assets.

Adient generally assumes operating margins in future years will normalize over time as it is believed that this is consistent with a market participant view.

The current year results are not indicative of future market participant expectations primarily due to the current challenging market conditions as mentioned above.

While revenue is not expected to return to historical levels, there are expectations for enhanced profitability and cash flows driven by near-term efficiency actions, strategic review of portfolio and reduction of capital expenditures.

Long-term profitability and cash flows will also be impacted by the expiration of underperforming contracts and more profitable business starting in fiscal 2026 along with restructuring benefits taking full effect.

Further, the high levels of recent restructurings and the associated significant costs of such actions in the EMEA region are not expected to persist for the long-term at comparable levels.

factors including weakening consumer demand due in part to vehicle affordability, the direct and indirect impacts resulting from the imposition of U.S.

and foreign tariffs, market share loss for foreign/luxury OEMs in the Asia reporting unit combined with modest expected margin declines as Adient continues to win new business with local OEMs in China, intensifying competition from Chinese imports, lower exports to China from EMEA as domestic brands expand in China and overcapacity in the EMEA reporting unit resulting in pricing pressure, along with continued disruptions caused by slower electric vehicle adoption rates.

The analysis was performed using a fair value method based on management's judgments and assumptions regarding future cash flows for all three reporting units.

The inputs utilized in the analyses are classified as Level 3 inputs within the fair value hierarchy as defined in ASC 820, “Fair Value Measurement.” These calculations contained uncertainties as they require management to make assumptions about market comparables, future cash flows, and the appropriate discount rates (based on weighted average cost of capital ranging from 16.5 % to 21.0 %) to reflect the risk inherent in the future cash flows and to derive a reasonable enterprise value and related premium.

The estimated future cash flows reflected management's updated assumptions of the financial projections based on anticipated competitive landscape, including estimates of revenue based on production volumes over the foreseeable future and long-term growth rates, and operating margins based on historical trends and future cost containment activities.

The financial projections considered the impact of all of the factors identified above, which contributed to a reduction in reporting unit level and overall fair value.

As a result of the quantitative assessment and for the factors stated above, a $ 333 million non-cash goodwill impairment was recorded in the EMEA reporting unit during the quarter ended March 31, 2025.

This amount is reflected in restructuring and impairment costs within the consolidated statements of income (loss).

No amounts of goodwill remain recorded in EMEA.

The difference between the fair value and carrying value of the Americas and Asia reporting units both modestly exceeded 10% at March 31, 2025.

During the fourth quarter of fiscal year 2025, Adient performed its annual goodwill impairment test using a fair value method based on management's judgments and assumptions regarding future cash flows.

Based on updated assumptions about market comparables, future cash flows, and the appropriate discount rates (based on weighted average cost of capital ranging from 15.5 % to 20.0 %), no goodwill impairment was recorded at September 30, 2025.

The fair values of both the Americas and Asia reporting units are higher at September 30, 2025 reflecting the increase in the overall market value of Adient’s ordinary shares and generating higher levels of fair value in excess of carrying value for both reporting units.

If further degradation in economic conditions occur, Adient’s reporting units may incur significant impairment of goodwill and other long-lived assets.

Adient generally assumes operating margins in future years will normalize over time as the current year results are not indicative of market participant expectations primarily due to the current challenging market conditions as mentioned above.

Management believes this is consistent with a market participant view.

There are also expectations for enhanced profitability and cash flows driven by near-term efficiency actions, strategic review of portfolio and reduction of capital expenditures.

Long-term profitability and cash flows will also be impacted by the expiration of underperforming contracts along with restructuring benefits taking full effect.

Adient's other intangible assets, primarily from business acquisitions valued based on independent appraisals, consisted of:

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Adient anticipates amortization for fiscal 2026, 2027, 2028, 2029 and 2030 will be approximately $ 46 million, $ 26 million, $ 19 million, $ 19 million and $ 19 million, respectively.

Adient plc | Form 10-K | 73

Product Warranty

6 unchanged sentences

The changes in Adient's total product warranty liability are as follows:

Adient plc | Form 10-K | 71

September 30,

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Total lease cost $ 137 $ 137 $ 137

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Operating lease right-of-use assets and lease liabilities included in the consolidated statement of financial position were as follows:

10 unchanged sentences

Maturities of operating lease liabilities and minimum payments for operating leases having initial or remaining non-cancelable terms in excess of one year as of September 30, 2025 were as follows:

Adient plc | Form 10-K | 72

Fiscal years (in millions) Operating Leases

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Refer to Note 9, “Debt and Financing Arrangements,” of the notes to consolidated financial statements for additional information.

Adient plc | Form 10-K | 75

Debt and Financing Arrangements

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(1) The weighted average interest rates on short-term debts, based on levels of debt maintained in various jurisdictions, were 3.7 % and 5.4 % at September 30, 2025 and 2024, respectively.

Adient plc | Form 10-K | 73

Adient US LLC (“Adient US”), a wholly owned subsidiary of Adient, together with certain of Adient's other subsidiaries, maintains an asset-based revolving credit facility (the “ABL Credit Facility”), which provides for a revolving line of credit up to $ 1,250 million, including a North American subfacility of up to $ 950 million and a European subfacility of up to $ 300 million, subject to borrowing base capacity and certain other restrictions, including a minimum fixed charge coverage ratio.

The ABL Credit Facility, as amended in November 2022, is set to mature on November 2, 2027, subject to certain springing maturity provisions.

Adient paid $ 7 million in debt issuance costs for the amended ABL Credit Facility and will pay a commitment fee of 0.25 % to 0.375 % on the unused portion of the commitments under the asset-based revolving credit facility based on average global availability.

The ABL Credit Facility is set to mature on November 2, 2027, subject to certain springing maturity provisions.

Adient will pay a commitment fee of 0.25 % to 0.375 % on the unused portion of the commitments under the asset-based revolving credit facility based on average global availability.

Letters of credit are limited to the lesser of (x) $ 150 million and (y) the aggregate unused amount of commitments under the ABL Credit Facility then in effect.

6 unchanged sentences

As of September 30, 2025, Adient had not drawn down on the ABL Credit Facility and had availability under this facility of approximately $ 814 million (net of $ 8 million of letters of credit).

In October 2025, Adient amended the ABL Credit Facility agreement, reducing the maximum facility from $ 1,250 million to $ 1,000 million (consisting of a North American subfacility of up to $ 895 million and a European subfacility of up to $ 105 million) and extending the maturity date to October 2030.

Under the amended agreement, the commitment fee on the unused portion of the commitments is lowered from 0.25 % - 0.375 % to 0.20 % - 0.25 %.

The range of applicable interest margin was also updated from 1.50 % - 2.00 % to 1.25 % - 1.75 %.

In addition, Adient Global Holdings S.à r.l., a wholly-owned subsidiary of Adient, maintains a senior secured term loan facility (the “Term Loan B Agreement”) that had an outstanding balance of $ 625 million as of September 30, 2025.

During fiscal 2023, Adient prepaid $ 350 million of the Term Loan B Agreement principal, and wrote off $ 2 million of previously deferred financing costs to net financing charges.

During fiscal 2024, the Term Loan B Agreement was amended to reduce the applicable margin from 3.25 % to 2.75 % and extend final maturity to January 31, 2031 (which maturity was previously April 8, 2028).

Adient incurred $ 5 million of costs associated with the modification, of which $ 4 million was recorded as deferred financing costs.

During fiscal 2025, the Term Loan B Agreement

Adient plc | Form 10-K | 76

was further amended to reduce the applicable margin from 2.75 % to 2.25 %.

Adient incurred $ 1 million of costs associated with the modification, which was recorded as deferred financing costs.

The Term Loan B Agreement amortizes in equal quarterly installments at a rate of 1.00 % per annum of the original principal amount thereof, with the remaining balance due at final maturity.

The Term Loan B Agreement also permits Adient to incur incremental term loans in an aggregate amount not to exceed the greater of $ 750 million and an unlimited amount subject to a pro forma first lien secured net leverage ratio of not greater than 1.75 to 1.00 and certain other conditions.

Interest on the Term Loan B Agreement accrues at Term SOFR plus an applicable margin.

The ABL Credit Facility and Term Loan B Agreement contain covenants that are usual and customary for facilities and debt instruments of this type and that, among other things, restrict the ability of Adient and its restricted subsidiaries to:

6 unchanged sentences

The agreements also provide for customary events of default, including, but not limited to, cross-default clauses with other debt arrangements, failure to pay principal and interest, failure to comply with covenants, agreements or conditions, and certain events of bankruptcy or insolvency involving Adient and its significant subsidiaries.

During fiscal 2023, Adient Global Holdings Ltd.

(“AGH”), a wholly-owned subsidiary of Adient, issued (i) $ 500 million (net proceeds of $ 494 million) in aggregate principal amount of 7 % senior secured notes due 2028 and (ii) $ 500 million (net proceeds of $ 494 million) in aggregate principal amount of 8.250 % senior unsecured notes due 2031.

Interest on both of these notes are paid on April 15 and October 15 each year, beginning on October 15, 2023.

Adient Global Holdings Ltd.

(“AGH”), a wholly-owned subsidiary of Adient, maintains (i) $ 500 million in aggregate principal amount of 7 % senior secured notes due 2028 and (ii) $ 500 million in aggregate principal amount of 8.250 % senior unsecured notes due 2031.

Interest on both of these notes are paid on April 15 and October 15 each year.

These notes contain covenants that are usual and customary.

The total net proceeds of $ 988 million along with cash on hand were used primarily to redeem $ 350 million of the senior secured term loan facility under the Term Loan B Agreement as described above, and repurchase € 700 million ($ 743 million) of the 3.50 % unsecured notes due 2024 as described below.

Adient paid $ 16 million in debt issuance costs for these new debt issuances.

AGH also maintains 4.875 % USD-denominated unsecured notes due 2026.

The aggregate principal amount of these notes was $ 795 million as of September 30, 2024 and 2023.

AGH also paid the remaining balance of its 3.50 % Euro denominated unsecured notes of € 123 million ($ 132 million) in August 2024 upon final maturity.

During fiscal 2023, Adient repurchased € 700 million ($ 743 million) of the 3.50 % unsecured notes due 2024 at a premium of € 7 million ($ 7 million) plus € 3 million ($ 3 million) of accrued and unpaid interest, and expensed € 2 million ($ 2 million) of previously deferred financing costs to net financing charges.

Adient plc | Form 10-K | 74

During fiscal 2022, Adient repurchased the entirety of its $ 600 million, 9.00 % Senior First Lien Notes due 2025 at a premium of $ 34 million plus $ 19 million of accrued interest.

AGH also previously maintained 4.875 % USD-denominated unsecured notes due 2026.

The aggregate principal amount of these notes was $ 795 million as of September 30, 2024.

In February 2025, AGH issued $ 795 million (net proceeds of $ 783 million) in aggregate principal amount of 7.50 % senior unsecured notes.

Adient incurred $ 12 million of costs associated with the transaction, which was recorded as deferred financing costs.

Proceeds from the sale of the notes, together with cash on hand, were used to fully redeem AGH's 4.875 % senior unsecured notes in March 2025.

Upon redemption of the 4.875 % notes, Adient wrote off $ 2 million of previously deferred financing costs associated with the notes to net financing charges.

The new notes mature on February 15, 2033 and bear interest at a rate of 7.50 % per annum.

Interest on the notes is payable semi-annually in arrears on February 15 and August 15 of each year, commencing on August 15, 2025.

These notes also contain covenants that are usual and customary.

Principal payments required on long-term debt during the next five years are as follows:

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Premium paid on repurchase of debt — — 7

Derivative loss on Yanfeng transaction — — 3

Net foreign exchange — 8 4

Net financing charges $ 193 $ 189 $ 195

Adient plc | Form 10-K | 77

Banking fees in fiscal 2025 and 2023 includes $ 2 million and $ 4 million, respectively, of one-time accelerated-deferred financing fee charges associated with voluntary repayments of debt.

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As of both September 30, 2024 and September 30, 2023, $ 170 million was funded under these programs.

As of September 30, 2025 and 2024, $ 185 million and $ 170 million was funded under these programs, respectively.

Adient also has a program with an external financial institution under which Adient's suppliers can sell their receivables from Adient to the financial institution at their sole discretion.

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The payment terms for molds, dies and other tools that are acquired as part of pre-production activities are in general longer, and are normally dependent on the terms which Adient has agreed with its customers.

As of September 30, 2024, and September 30, 2023, Adient's liabilities related to this program were $ 76 million and $ 50 million, respectively.

As of September 30, 2025, Adient's liabilities related to this program were $ 105 million which is recorded within accounts payable ($ 16 million) and other current liabilities ($ 89 million) in Adient’s consolidated statements of financial position.

As of September 30, 2024, Adient's liabilities related to this program were $ 76 million which is recorded within accounts payable ($ 5 million) and other current liabilities ($ 71 million) in Adient’s consolidated statements of financial position.

Cash flows related to the program are all presented within operating activities in Adient's consolidated statements of cash flows.

A summary of Adient’s outstanding obligations under the supplier finance program for the year ended September 30, 2025 is as follows:

(in millions) Year Ended September 30, 2025

Balance at beginning of period $ 76

Invoices confirmed 122

Confirmed invoices paid ( 96 )

Currency translations 3

Balance at end of period $ 105

Derivative Instruments and Hedging Activities

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In addition, refer to Note 11, “Fair Value Measurements,” of the notes to consolidated financial statements for information related to the fair value measurements and valuation methods utilized by Adient for each derivative type.

Adient plc | Form 10-K | 75

Adient has global operations and participates in the foreign exchange markets to minimize its risk of loss from fluctuations in foreign currency exchange rates.

4 unchanged sentences

All contracts were highly effective in hedging the variability in future cash flows attributable to changes in currency exchange rates at September 30, 2025 and 2024, respectively.

The € 123 million ($ 132 million) aggregate principal amount of 3.50 % Euro-denominated unsecured notes due August 2024 was previously designated as a net investment hedge to selectively hedge portions of Adient's net investment in Europe.

The currency effects of Adient's Euro-denominated notes are reflected in the AOCI account within shareholders' equity attributable to Adient where they offset gains and losses recorded on Adient's net investment in Europe.

During the first quarter of fiscal 2024, Adient de-designated these notes as a net investment hedge concurrent with entering into a foreign exchange forward contract designated as a fair value hedge of the principal balance on the 3.50 % notes.

The impact of foreign currency changes on the notes and the contract were recorded in net financing charges until payment of the notes and maturity of the foreign exchange forward contract in August 2024.

Adient plc | Form 10-K | 78

Adient also utilizes foreign currency exchange contracts and cross currency interest rate swap contracts to selectively hedge portions of its investments in foreign subsidiaries.

Such contracts are designated as net investment hedges, with the objective of managing the impact of foreign currency exchange rate fluctuations on Adient’s net investments.

The currency effects of such contracts are reflected in the AOCI account within shareholders’ equity attributable to Adient, where gains and losses recorded on Adient’s net investment are offset.

During the fourth quarter of fiscal 2025, Adient entered into cross-currency interest rate swap agreements with an aggregate notional amount of $ 325 million in order to hedge the foreign currency risk associated with its net investment in European subsidiaries.

The currency remeasurement impacts of the instruments are reflected in the AOCI account within shareholders' equity attributable to Adient where they offset gains and losses recorded on Adient's net investment in Europe.

These agreements expire over a three-year period and have been designated as net investment hedges of Adient's Euro denominated subsidiaries.

Under the terms of the agreements, Adient receives fixed-rate interest payments in U.S.

dollar at a weighted average rate of 1.85 % and pays 0.00 % on the fixed-rate Euro leg.

The interest rate differentials are recorded within net financing charges on the consolidated statement of income (loss).

During the third quarter of fiscal 2025, Adient entered into a ¥ 559 million ($ 78 million) foreign currency exchange contract to selectively hedge portions of its net investment in China.

The contract is set to mature in October 2026.

During the third quarter of fiscal 2024, Adient entered into a ¥ 570 million ($ 78 million) foreign currency exchange contract to selectively hedge portions of its net investment in China.

In October 2025, a portion of the contract totaling ¥ 413 million ($ 56 million) matured, the impact of which was not material.

The remainder of the contract is set to mature in June 2026.

During the second quarter of fiscal 2024, Adient entered into a ¥ 685 million ($ 96 million) foreign exchange forward contract to selectively hedge portions of its net investment in China.

Adient de-designated the majority of the contracted amount during fourth quarter of fiscal 2024, resulting in an outstanding contract amount of ¥ 120 million ($ 17 million) as of September 30, 2024.

The contract matured in October 2024, the impact of which was not material.

During the third quarter of fiscal 2024, Adient entered into an additional ¥ 570 million ($ 78 million) contract to selectively hedge portions of its net investment in China.

The contract is set to mature in October 2025.

Adient entered into a ¥ 240 million ($ 35 million) foreign exchange forward contract during the second quarter of fiscal 2023 to selectively hedge portions of its net investment in China.

The currency effects of the forward contract were reflected in the AOCI account within shareholders’ equity attributable to Adient, where they offset gains and losses recorded on Adient’s net investment in China.

The contract matured during the first quarter of fiscal 2025, the impact of which was not material.

During the second quarter of fiscal 2023, Adient entered into a ¥ 240 million ($ 35 million) foreign exchange forward contract to selectively hedge portions of its net investment in China.

During fiscal 2023, the foreign exchange forward contract matured, the impact of which was not material.

Adient entered into a ¥ 150 million ($ 23 million) foreign exchange forward contract during fiscal 2022 to selectively hedge portions of its net investment in China.

The currency effects of the forward contract are reflected in the AOCI account within shareholders’ equity attributable to Adient, where they offset gains and losses recorded on Adient’s net investment in China.

The forward contract matured in early fiscal 2023, the impact of which was not material.

The € 123 million aggregate principal amount of 3.50 % Euro-denominated unsecured notes paid off in August 2024 was previously designated as a net investment hedge to selectively hedge portions of Adient's net investment in Europe.

Adient plc | Form 10-K | 79

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Foreign currency exchange derivatives $ 7 $ 32 $ — $ —

Cross-currency interest rate swaps 1 — — —

Other noncurrent liabilities

Foreign currency exchange derivatives 2 9 1 —

Long-term debt

Foreign currency denominated debt — 130 — —

Cross-currency interest rate swaps 3 — — —

Total liabilities $ 13 $ 41 $ 1 $ —

16 unchanged sentences

Adient plc | Form 10-K | 80

The following table presents the location and amount of the effective portion of pretax gains (losses) on cash flow hedges reclassified from AOCI into Adient's consolidated statements of income:

The following table presents the location and amount of the effective portion of pretax gains (losses) on cash flow hedges reclassified from AOCI into Adient's consolidated statements of income (loss):

(in millions) Year Ended

2 unchanged sentences

Foreign currency exchange derivatives Cost of sales $ ( 8 ) $ 46 $ 66

During the next twelve months, $ 23 million of pretax loss on cash flow hedges are expected to be reclassified from AOCI into Adient's consolidated statements of income.

The following table presents the location and amount of pretax gains (losses) on fair value hedge activity in Adient's consolidated statements of income:

During the next twelve months, $ 28 million of pretax gain on cash flow hedges are expected to be reclassified from AOCI into Adient's consolidated statements of income (loss).

The following table presents the location and amount of pretax gains (losses) on fair value hedge activity in Adient's consolidated statements of income (loss):

(in millions) Year Ended

37 unchanged sentences

Foreign currency exchange derivatives $ 7 $ — $ 7 $ —

Cross currency interest rate swaps 1 — 1 —

Other noncurrent liabilities

Foreign currency exchange derivatives 3 — 3 —

Cross currency interest rate swaps 3 — 3 —

Total liabilities $ 14 $ — $ 14 $ —

7 unchanged sentences

Foreign currency exchange derivatives $ 15 $ — $ 15 $ —

Other noncurrent assets

Foreign currency exchange derivatives 3 — 3 —

Total assets $ 18 $ — $ 18 $ —

9 unchanged sentences

These contracts were highly effective in hedging the variability in future cash flows attributable to changes in currency exchange rates at September 30, 2025 and 2024, respectively.

The changes in fair value of foreign currency exchange derivatives not designated as hedging instruments under ASC 815 are recorded in the consolidated statements of income.

The fair value of cash and cash equivalents, accounts receivable, short-term debt and accounts payable approximate their carrying values.

The fair value of long-term debt, which was $ 2.4 billion and $ 2.5 billion at September 30, 2024 and 2023, respectively, was determined primarily using market quotes classified as Level 1 inputs within the ASC 820 fair value hierarchy.

The changes in fair value of foreign currency exchange derivatives not designated as hedging instruments under ASC 815 are recorded in the consolidated statements of income (loss).

Adient plc | Form 10-K | 82

The fair value of long-term debt, which was $ 2.5 billion and $ 2.4 billion at both September 30, 2025 and 2024, respectively, was determined primarily using market quotes classified as Level 1 inputs within the ASC 820 fair value hierarchy.

Stock-Based Compensation

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Adient also provides directors with share awards under the Adient plc 2016 Director Share Plan and the Adient plc 2021 Omnibus Incentive Plan.

Total stock-based compensation cost included in the consolidated statements of income was $ 31 million, $ 34 million and $ 29 million for the fiscal years ended September 30, 2024, 2023 and 2022, respectively.

No material income tax benefits were recognized in the consolidated statements of income for the share-based compensation arrangements in any of these years due to tax valuation allowances in those years.

Total stock-based compensation cost included in the consolidated statements of income (loss) was $ 32 million, $ 31 million and $ 34 million for the fiscal years ended September 30, 2025, 2024 and 2023, respectively.

No material income tax benefits were recognized in the consolidated statements of income (loss) for the share-based compensation arrangements in any of these years due to tax valuation allowances in those years.

The following tables present activity related to the granting of awards during the year ended September 30, 2025 along with the composition of outstanding and exercisable awards at September 30, 2025.

56 unchanged sentences

(1) Foreign currency translation adjustments as of September 30, 2025 and 2024 include gains (losses) on designated net investment hedge instruments of $( 7 ) million and $( 4 ) million, respectively.

During the next twelve months, no significant gains or losses are expected to be reclassified from AOCI into Adient's consolidated statements of income.

During the next twelve months, no significant gains or losses are expected to be reclassified from AOCI into Adient's consolidated statements of income (loss).

Adient consolidates certain subsidiaries in which the noncontrolling interest party has within their control the right to require Adient to redeem all or a portion of its interest in the subsidiary.

9 unchanged sentences

Dividends ( 31 ) ( 21 ) ( 18 )

Change in noncontrolling interest share — — ( 153 )

Foreign currency translation adjustments ( 1 ) 17 3

1 unchanged sentence

(1) During fiscal 2024, a $ 5 million adjustment was recorded to increase income attributable to noncontrolling interest related to fiscal 2023.

The change in noncontrolling interests in fiscal 2022 relates to Adient’s acquisition of the remaining 25 % interest in Chongqing Adient Automotive Components Co., Ltd.

Repurchases of Equity Securities

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pension plans equals or exceeds the minimum requirements of the Employee Retirement Income Security Act of 1974.

For pension plans with accumulated benefit obligations (“ABO”) that exceed plan assets, the projected benefit obligation (“PBO”), ABO and fair value of plan assets of those plans were $ 162 million, $ 144 million and $ 52 million, respectively, as of September 30, 2024, and $ 155 million, $ 137 million and $ 48 million, respectively, as of September 30, 2023.

For pension plans with a PBO that exceed plan assets, the PBO, ABO and fair value of plan assets of those plans were $ 162 million, $ 144 million and $ 52 million, respectively, as of September 30, 2024 and $ 155 million, $ 137 million and $ 48 million, respectively, as of September 30, 2023.

For pension plans with accumulated benefit obligations (“ABO”) that exceed plan assets and for pension plans with a PBO that exceed plan assets, the projected benefit obligation (“PBO”), ABO and fair value of plan assets of those plans were $ 155 million, $ 135 million and $ 38 million, respectively, as of September 30, 2025, and $ 162 million, $ 144 million and $ 52 million, respectively, as of September 30, 2024.

In fiscal 2025, Adient paid contributions to the defined benefit pension plans of $ 18 million.

1 unchanged sentence

Projected benefit payments from the plans as of September 30, 2025 are estimated as follows (in millions):

Adient plc | Form 10-K | 82

2031-2034 154

Adient plc | Form 10-K | 85

Savings and Investment Plans

45 unchanged sentences

International - Developed 19 19 — — —

International - Emerging — — — — —

Fixed Income Securities

32 unchanged sentences

Redemptions ( 4 )

Unrealized gain ( 1 )

Asset value as of September 30, 2024 $ —

44 unchanged sentences

Accumulated Other Comprehensive Income

The amounts in AOCI on the consolidated statements of financial position, exclusive of tax impacts, that have not yet been recognized as components of net periodic benefit cost at September 30, 2024 and 2023 were $ 2 million and $ 2 million, respectively, related to pension benefits.

The amounts in AOCI expected to be recognized as components of net periodic benefit cost over the next fiscal year for pension and postretirement benefits are not significant.

The amounts in AOCI on the consolidated statements of financial position, exclusive of tax impacts, that have not yet been recognized as components of net periodic benefit cost related to pension benefits were $ 2 million at both September 30, 2025 and 2024.

The amounts in AOCI expected to be recognized as components of net periodic benefit cost over the next fiscal year for pension benefits are not significant.

Net Periodic Benefit Cost

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Expected return on plan assets ( 13 ) ( 12 ) ( 12 )

Net actuarial loss (gain) 13 19 ( 7 )

Net actuarial loss 3 13 19

Settlement loss 4 1 8

Net periodic benefit cost (credit)

Net periodic benefit cost

$ 16 $ 27 $ 38

6 unchanged sentences

Rate of compensation increase N/A N/A NA 4.38 % 4.53 % 4.43 %

The interest cost, expected return on plan assets, and net actuarial and settlement/curtailment (gain) loss components of net periodic benefit cost are included in other pension expense in the consolidated statements of income (loss).

Adient plc | Form 10-K | 89

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All other costs associated with restructuring activities are expensed as incurred.

During fiscal 2024, Adient committed to a restructuring plan of $ 169 million that was offset by prior period underspend of $ 1 million and $ 9 million of cost reimbursement committed by a customer.

The fiscal 2024 charges are mostly related to termination benefits in Europe.

The 2024 Plan is being implemented in response to the macroeconomic factors occurring in the European automotive market causing reduced production volumes and to ensure Adient maintains a competitive cost structure by reducing operating, administrative and engineering costs, and increasing efficiencies.

Restructuring actions associated with these specific plans will primarily occur in fiscal years 2025 and 2026 and are expected to be substantially complete by fiscal year 2027.

Restructuring costs are included in restructuring and impairment costs in the consolidated statements of income.

During fiscal 2025, Adient committed to a restructuring plan (“2025 Plan”) resulting in charges of $ 58 million that was offset by $ 7 million of prior-period underspend.

The 2025 Plan, which is primarily related to termination benefits in Europe, is being implemented in response to manufacturing footprint and structural changes occurring in the global automotive industry and to ensure Adient maintains a competitive cost structure by reducing operating, administrative and engineering costs, and increasing efficiencies.

Restructuring actions associated with the 2025 Plan will primarily occur in fiscal years 2026 and 2027, and are expected to be substantially complete by fiscal year 2027.

Restructuring costs are included in restructuring and impairment costs in the consolidated statements of income (loss).

During fiscal 2024, Adient committed to a restructuring plan (“2024 Plan”) of $ 169 million that was offset by prior period underspend of $ 1 million and $ 9 million of cost reimbursement committed by a customer.

The fiscal 2024 charges were mostly related to termination benefits in Europe.

The 2024 Plan was implemented in response to the macroeconomic factors occurring in the European automotive market causing reduced production volumes and to ensure Adient maintains a competitive cost structure by reducing operating, administrative and engineering costs, and increasing efficiencies.

Restructuring actions associated with these specific plans primarily occurring in fiscal years 2025 and 2026 are expected to be substantially complete by fiscal year 2027.

The following tables summarize the changes in Adient's restructuring reserve.

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Because of the importance of new vehicle sales by automotive manufacturers, Adient is affected by the general business conditions in the automotive industry.

Future adverse developments in the automotive industry could impact Adient's liquidity position, lead to impairment charges and/or require additional restructuring of its operations.

During fiscal 2024, Adient recorded an impairment loss of $ 9 million on its investment in Adient Aerospace.

The impairment is included in restructuring and impairment costs in the consolidated statement of income (loss).

Future adverse developments in

Adient plc | Form 10-K | 90

the automotive industry could impact Adient's liquidity position, lead to impairment charges and/or require additional restructuring of its operations.

During fiscal 2025 and 2024, Adient recorded a non-cash impairment loss of $ 8 million and $ 9 million on its investment in Adient Aerospace, respectively.

The impairment is included in restructuring and impairment costs in the consolidated statements of income (loss).

No remaining investment is recorded as of September 30, 2025.

Refer also to Note 6, “Goodwill and Other Intangible Assets” of the notes to the consolidated financial statements for information about the EMEA goodwill impairment recorded during fiscal 2025.

Consolidated income (loss) before income taxes and noncontrolling interests for the years ended September 30, 2025, 2024, and 2023 is as follows:

18 unchanged sentences

These amounts do not include the impact of income tax expense related to Adient’s nonconsolidated partially-owned affiliates, which is netted against equity income on the consolidated statements of income (loss).

The reconciliation between the Irish statutory income tax rate, and Adient’s effective tax rate is as follows:

Adient plc | Form 10-K | 91

The reconciliation between the Irish statutory income tax rate, and Adient’s effective tax rate is as follows:

September 30,

3 unchanged sentences

Foreign tax rate differential

Notional interest deduction ( 6 ) ( 6 ) ( 6 )

Deemed interest — ( 6 ) ( 6 )

Credits and incentives ( 14 ) ( 12 ) ( 7 )

Nondeductible goodwill impairment 29 — —

Repatriation of foreign earnings 23 18 24

4 unchanged sentences

Tax adjustments to value of investments ( 873 ) ( 38 ) —

Tax impact of corporate equity and business restructuring transactions 1 1 30

Net operating loss expirations and write-offs 38 5 10

Other 6 ( 9 ) 1

Income tax provision $ 103 $ 32 $ —

The income tax expense was higher than the Irish statutory rate of 12.5% for fiscal 2025 primarily due to the inability to record a tax benefit for losses in jurisdictions with valuation allowances, the repatriation of foreign earnings, tax expense related to adjustments to net operating loss deferred tax assets, tax expense related to the establishment of uncertain tax positions, foreign tax rate differentials, and the impact of the impairment of the non-tax-deductible portion of the EMEA goodwill balance for which there is no corresponding income tax benefit, partially offset by tax benefits from audit closures and statute expirations.

No items included in the other category are individually, or when appropriately aggregated, significant.

The income tax expense was higher than the Irish statutory rate of 12.5% for fiscal 2024 due to the inability to record a tax benefit for losses in jurisdictions with valuation allowances, the repatriation of foreign earnings, tax expense related to foreign exchange remeasurements of tax balances primarily in Mexico, and tax expense from the establishment of valuation allowances at certain subsidiaries, partially offset by tax benefits from the release of uncertain tax positions due to audit closures and from the release of valuation allowances at certain subsidiaries.

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No items included in the other category are individually, or when appropriately aggregated, significant.

The income tax expense was higher than the Irish statutory rate of 12.5% for fiscal 2022 primarily due to the inability to recognize a tax benefit for losses in jurisdictions with valuation allowances, the establishment of valuation allowances in certain jurisdictions, and the repatriation of foreign earnings, partially offset by tax benefits related to the release of valuation allowances in certain jurisdictions.

No items included in the other category are individually, or when appropriately aggregated, significant.

Adient’s foreign tax rate differential primarily comprises two components.

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Second is the elimination of the effects, at the Irish statutory tax rate, on the amount of income reported for nonconsolidated partially-owned affiliates whose corresponding income tax expense is already netted against equity income on the consolidated statements of income and reflected in income (loss) before income taxes.

During fiscal 2024, 2023 and 2022, significant income and loss jurisdictions include Brazil, China, Germany, Luxembourg, Mexico, Thailand, the United Kingdom, and the United States, with federal statutory tax rates ranging between 16% and 34%, which are all above the Irish statutory rate of 12.5%.

Due to the significant jurisdictions in which it operates having statutory tax rates higher than the Irish statutory rate of 12.5%, Adient generally expects that foreign tax rate differentials will continue to result in net expense when its consolidated subsidiaries generate net pretax income and overall pretax income does not consist primarily of equity income from nonconsolidated partially-owned affiliates.

In periods in which Adient’s consolidated subsidiaries generate net losses, or overall pretax income consists primarily of equity income reported from nonconsolidated partially-owned affiliates, Adient generally expects that foreign tax rate differentials will result in a net benefit.

During fiscal 2024 and 2023, Adient’s pretax income was primarily generated by Adient’s consolidated subsidiaries, resulting in a net foreign tax rate differential expense.

During fiscal 2022, Adient’s pretax income consisted primarily of income of nonconsolidated partially-owned affiliates whose corresponding

During fiscal 2025, 2024 and 2023, significant income and loss jurisdictions include Brazil, China, Germany, India, Luxembourg, Mexico, Thailand, the United Kingdom, and the United States, with federal statutory tax rates ranging between 16% and 34%, which are all above the Irish statutory rate of 12.5%.

Due to the significant jurisdictions in which it operates having statutory tax rates higher than the Irish statutory rate of 12.5%, Adient generally expects that foreign tax rate differentials will continue to result in net expense when its consolidated subsidiaries generate net pretax income, adjusted for permanent book to tax differences, and overall pretax income, adjusted for permanent book to tax differences, does not consist primarily of equity income from nonconsolidated partially-owned affiliates.

In periods in which Adient’s consolidated subsidiaries generate net losses, adjusted for permanent book to tax differences, or overall pretax income, adjusted for permanent book to tax differences, consists primarily of equity income reported from

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income tax expense is netted against equity income on the consolidated statements of income, with the elimination of the effects at the Irish statutory tax rate resulting in a net foreign tax rate differential benefit.

nonconsolidated partially-owned affiliates, Adient generally expects that foreign tax rate differentials will result in a net benefit.

During fiscal 2025, 2024 and 2023, Adient’s pretax income, adjusted for permanent book to tax differences, was primarily generated by Adient’s consolidated subsidiaries, resulting in a net foreign tax rate differential expense.

For fiscal 2025, the foreign tax differential expense of $ 29 million includes $ 37 million related to the higher tax expense resulting from the tax rate differential primarily from the mix of income and losses in the significant jurisdictions listed above with higher statutory tax rates than Ireland, which was partially offset by $ 8 million related to the elimination of the tax effects of the equity income from nonconsolidated partially-owned affiliates whose corresponding income tax expense is already netted in income before income taxes.

For fiscal 2024, the foreign tax differential expense of $ 9 million includes $ 20 million related to the higher tax expense resulting from the tax rate differential primarily from the mix of income and losses in the significant jurisdictions listed above with higher statutory tax rates than Ireland, which was partially offset by $ 11 million related to the elimination of the tax effects of the equity income from nonconsolidated partially-owned affiliates whose corresponding income tax expense is already netted in income before income taxes.

For fiscal 2022, the foreign tax differential benefit of $ 1 million includes $ 9 million related to the elimination of the tax effects of the equity income from nonconsolidated partially-owned affiliates, partially offset by $ 8 million related to the higher tax expense resulting from tax rate differential primarily related to the mix of income and losses in Adient’s consolidated subsidiaries with tax rates higher than Ireland.

For fiscal 2023, the foreign tax differential expense of $ 22 million includes $ 33 million related to the higher tax expense resulting from the tax rate differential primarily from the mix of income and losses in the significant jurisdictions listed above with higher statutory tax rates than Ireland, which was partially offset by $ 11 million related to the elimination of the tax effects of the equity income from nonconsolidated partially-owned affiliates whose corresponding income tax expense is already netted in income before income taxes.

Deferred taxes are classified in the consolidated statements of financial position as follows:

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Unremitted earnings of foreign subsidiaries 33 39

Indirect tax credits — 10

Operating lease right-of-use assets 60 57

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Net operating loss carryforwards of $ 7.0 billion are offset by a valuation allowance.

During fiscal 2025, the net operating loss carryforward in Luxembourg increased by $ 3.7 billion ($ 873 million tax-effected) related to tax adjustments to the value of certain investments, arising from certain EMEA impairments, with an offsetting increase to the valuation allowance and no net impact to tax expense.

Adient reviews the realizability of its deferred tax assets on a quarterly basis, or whenever events or changes in circumstances indicate that a review is required.

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Since future financial results may differ from previous estimates, periodic adjustments to Adient's valuation allowances may be necessary.

Given current earnings and anticipated future earnings at certain subsidiaries, Adient believes that there is a possibility that sufficient positive evidence may become available that would allow the release of all, or a portion of, valuation allowances at certain subsidiaries within the next twelve months.

A release of valuation allowances, if any, would result in the recognition of certain deferred tax assets which could generate a material income tax benefit for the period in which such release is recorded.

As a result of Adient's fiscal 2024 analysis of the realizability of its worldwide deferred tax assets, and after considering tax planning initiatives and other positive and negative evidence, Adient determined it was more likely than not that certain deferred tax assets would be realizable and recorded an income tax benefit of $ 14 million in China, $ 8 million in Mexico, $ 7 million in France, and $ 6 million in Japan to release valuation allowances.

In addition, Adient determined it was necessary to establish valuation allowances on certain deferred tax assets in Poland and Mexico, recording tax expense of $ 14 million and $ 5 million, respectively.

The release of additional valuation allowances, if any, would result in the recognition of certain deferred tax assets which could generate a material income tax benefit for the period in which such release is recorded.

As a result of Adient's fiscal 2025 analysis of the realizability of its worldwide deferred tax assets, and after considering tax planning initiatives and other positive and negative evidence, Adient established and released valuation allowances on certain deferred tax assets at various subsidiaries, which did not have a material impact on Adient’s financial statements either individually or in the aggregate.

Adient continues to record valuation allowances on certain deferred tax assets in Germany, Hungary, Luxembourg, Mexico, Poland, Spain, the United Kingdom, the U.S.

and other jurisdictions as it remains more likely than not that they will not be realized.

During fiscal 2024, the valuation allowance in Luxembourg increased by $ 38 million related to tax adjustments to the value of certain investments, with an offsetting increase in net operating loss carryforwards and no net impact to tax expense.

1 unchanged sentence

In addition, Adient determined it was necessary to release valuation allowances and establish valuation allowances in other jurisdictions that did not have a material impact on Adient’s financial statements.

As a result of Adient's fiscal 2022 analysis of the realizability of its worldwide deferred tax assets, and after considering tax planning initiatives and other positive and negative evidence, Adient determined it was more likely than not that certain deferred tax assets in Canada, Japan, and other jurisdictions would not be realized and recorded income tax expense of $ 12 million, $ 3 million and $ 3 million, respectively, to establish valuation allowances.

Additionally, Adient determined it was more likely than not that deferred tax assets in the Czech Republic and other jurisdictions would be realizable and recorded income tax benefit of $ 11 million and $ 2 million, respectively, to release valuation allowances.

Adient is subject to income taxes in Ireland, the U.S.

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For the year ended September 30, 2025, Adient believes that it is more likely than not that the tax positions it has taken will be sustained upon the resolution of its audits resulting in no material impact on its consolidated financial statements.

However, the final determination with respect to tax audits and any related litigation could be materially different from Adient’s estimates.

However, the final determination with respect to tax audits and any related litigation could be materially different from Adient’s estimates given the increased levels of discussions and more aggressive negotiations by the tax authorities as part of the tax audit process.

Subsequent to September 30, 2025, Adient initiated a foreign tax audit settlement proposal which, although still under negotiation with the foreign tax authorities, is expected to require a non-recurring recognition and payment of approximately $ 20 million in fiscal 2026.

For the years ended September 30, 2025, 2024 and 2023, Adient had gross tax effected unrecognized tax benefits of $ 404 million, $ 422 million, and $ 527 million, respectively.

If recognized, $ 106 million of Adient's unrecognized tax benefits would impact the effective tax rate.

If recognized, $ 114 million of Adient's unrecognized tax benefits

Adient plc | Form 10-K | 94

would impact the effective tax rate.

Total net accrued interest for the years ended September 30, 2025, 2024 and 2023, was approximately $ 21 million, $ 21 million and $ 31 million, respectively (net of tax benefit).

Adient recognizes interest and penalties related to unrecognized tax benefits as a component of income tax expense.

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During fiscal 2025, Adient recognized tax expense of $ 10 million related to the establishment of uncertain tax positions.

During fiscal 2024, Adient settled audits in various jurisdictions that resulted in a $ 115 million reduction to its unrecognized tax benefits, of which $ 63 million was recorded as a tax benefit.

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Income taxes paid for the fiscal years ended September 30, 2025, 2024 and 2023 were $ 92 million, $ 96 million and $ 94 million, respectively.

Impacts of Tax Legislation and Change in Statutory Tax Rates

On August 16, 2022, President Biden signed the Inflation Reduction Act of 2022 into law.

Adient does not expect the provisions of the legislation to have a significant impact on the effective tax rate or the income tax payable and deferred income tax positions of Adient.

During fiscal 2025, Adient recognized net tax benefits of $ 25 million related to audit closures and statute expirations, inclusive of the release of unrecognized tax benefits.

Additionally, Adient recognized tax expense of $ 19 million related to adjustments to net operating loss deferred tax assets, net of related valuation allowance benefits, as well as a net tax benefit of $ 13 million related to the impairment of tax-deductible goodwill in Europe.

The Organization for Economic Cooperation and Development’s Pillar Two initiative, which introduced a 15% global minimum tax applied on a country by country basis, is applicable for Adient’s fiscal 2025.

The annual effect of these new rules and the impact on Adient’s effective tax rate was not material in fiscal 2025.

Adient will continue to monitor and evaluate new legislation and guidance related to Pillar Two.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law.

The OBBBA makes permanent key elements of the Tax Cuts and Jobs Act, including 100% bonus depreciation, domestic research cost expensing, and the business interest expense limitation.

ASC 740 requires the effects of changes in tax rates and laws to be recognized in the period in which the legislation is enacted.

The OBBBA did not have a material impact on Adient’s consolidated financial statements.

Adient will continue to evaluate the OBBBA and related guidance.

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The $ 69 million impact of tax rate changes for fiscal 2025 is primarily related to legislation that was enacted in Germany on July 18, 2025, under which Germany’s corporate tax rate will ratably decrease by five percent over five years, beginning in 2028.

Net of related valuation allowance offsets, the tax rate changes did not have a material impact on Adient’s consolidated financial statements.

During fiscal years 2025, 2024 and 2023, other tax legislation was adopted in various jurisdictions.

These law changes did not have a material impact on the consolidated financial statements.

Tax Impact of One-Time Items

During fiscal 2022, Adient recognized a one-time gain of $ 32 million associated with the retrospective recovery of indirect tax credits in Brazil resulting from Adient’s prioritization of those credits, resulting in net tax expense of $ 4 million.

Segment Information

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2) Europe, the Middle East and Africa (“EMEA”) and 3) Asia Pacific/China (“Asia”).

Adient evaluates the performance of its reportable segments using an adjusted EBITDA metric defined as income before income taxes and noncontrolling interests, excluding net financing charges, restructuring and impairment costs, restructuring related-costs, net mark-to-market adjustments on pension and postretirement plans, transaction gains/losses, purchase accounting amortization, depreciation, stock-based compensation and other non-recurring items (“Adjusted EBITDA”).

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certain corporate-related costs are not allocated to the segments.

Adient evaluates the performance of its reportable segments using an adjusted EBITDA metric defined as income before income taxes and noncontrolling interests, excluding net financing charges, restructuring and impairment costs, restructuring-related costs, net mark-to-market adjustments on pension plans, transaction gains/losses, purchase accounting amortization, depreciation, stock-based compensation and other non-recurring items (“Adjusted EBITDA”).

Also, certain corporate-related costs are not allocated to the segments.

The reportable segments are consistent with how management views the markets served by Adient and reflect the financial information that is reviewed by its chief operating decision maker.

The following table summarizes net sales and adjusted EBITDA by reportable segment for fiscal 2024, 2023 and 2022:

(in millions) Americas EMEA Asia Corporate/Eliminations Consolidated

Net sales $ 6,763 $ 5,029 $ 2,989 $ ( 93 ) $ 14,688

Adjusted EBITDA $ 375 $ 155 $ 439 $ ( 89 ) $ 880

Net sales $ 7,220 $ 5,195 $ 3,085 $ ( 105 ) $ 15,395

Adjusted EBITDA $ 336 $ 232 $ 464 $ ( 94 ) $ 938

Net sales $ 6,557 $ 4,764 $ 2,926 $ ( 126 ) $ 14,121

During the fourth quarter of fiscal 2025, Adient adopted ASU No.

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosure.

Prior period disclosures have been reclassified to conform to the current period presentation.

The President and Chief Executive Officer is Adient’s chief operating decision maker (“CODM”).

The CODM evaluates the performance of the reportable segments using Adjusted EBITDA.

Adjusted EBITDA is used for forecasting and to measure periodic performance and cash flow generation of the reportable segments and to make capital allocation decisions within the operations that ultimately provide shareholder returns.

The following tables summarize Adient's reportable segments' sales and Adjusted EBITDA which includes significant expenses that align with the segment-level information that is regularly provided to the CODM.

The reportable segments’ Adjusted EBITDA is reconciled to income (loss) before income taxes for fiscal 2025, 2024 and 2023:

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September 30, 2025

(in millions) Americas EMEA Asia Consolidated

Segment net sales $ 6,856 $ 4,773 $ 2,983 $ 14,612

Eliminations ( 77 )

Consolidated net sales $ 14,535

Material costs 4,444 2,958 2,056

Labor and overhead 1,819 1,495 419

Administrative, engineering and allocated costs 191 213 122

Equity income — 17 54

Adjusted EBITDA $ 402 $ 124 $ 440 $ 966

The following is a reconciliation of Adient's reportable segments' adjusted EBITDA to income before income taxes:

Reconciliation to income (loss) before income taxes

Corporate-related costs (1)

Restructuring and impairment costs (2)

Purchase accounting amortization (3)

Restructuring-related activities (4)

Gain on disposal transactions (5)

Depreciation expense ( 279 )

Equity based compensation ( 32 )

Other items (6)

Net financing charges ( 193 )

Other pension expense ( 10 )

Income (loss) before income taxes ( 88 )

(1) Certain corporate-related costs are not allocated to the segments including executive office, communications, corporate development, legal and corporate finance.

(2) Reflects restructuring charges for costs that are probable and reasonably estimable and non-recurring asset impairments, including a non-recurring, non-cash goodwill impairment charge of $ 333 million in the EMEA reporting unit, restructuring charges of $ 51 million, and an impairment charge of $ 8 million related to Adient’s investment in Adient Aerospace.

Refer to Note 6, “Goodwill and Other Intangible Assets” and Note 15, “Restructuring and Impairment Costs” of the notes to the consolidated financial statements for additional information.

(3) Reflects amortization of intangible assets including those related to partially-owned affiliates recorded within equity income.

(4) Reflects restructuring-related charges for costs that are recorded as incurred or as earned and other non-recurring impacts that are directly attributable to restructuring activities, including $ 29 million of restructuring-related charges primarily recorded in cost of sales and $ 5 million of restructuring-related charges at a partially-owned affiliate recorded in equity income, partially offset by a $ 23 million gain on the sales of restructured facilities across all segments recorded in SG&A.

(5) Reflects a $ 4 million gain on sale of Adient's partially-owned affiliate investment in Setex recorded within equity income.

(6) Includes $ 10 million of third-party consulting costs associated with strategic planning and a $ 1 million non-recurring loss at a partially-owned affiliate recorded within equity income, partially offset by a $ 2 million gain on a non-recurring contract related settlement.

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September 30, 2024

(in millions) 2024 2023 2022

(in millions) Americas EMEA Asia Consolidated

Segment net sales $ 6,763 $ 5,029 $ 2,989 $ 14,781

Eliminations ( 93 )

Consolidated net sales $ 14,688

Material costs 4,394 3,123 2,061

Labor and overhead 1,841 1,568 426

Administrative, engineering and allocated costs 156 198 136

Equity income 3 15 73

Adjusted EBITDA $ 375 $ 155 $ 439 $ 969

Americas $ 375 $ 336 $ 242

EMEA 155 232 138

Asia 439 464 383

Subtotal 969 1,032 763

Reconciliation to income (loss) before income taxes

Corporate-related costs (1)

( 89 ) ( 94 ) ( 88 )

Restructuring and impairment costs (2)

( 168 ) ( 40 ) ( 25 )

Purchase accounting amortization (3)

( 48 ) ( 52 ) ( 54 )

Restructuring-related activities (4)

Loss on disposal transactions (5)

( 7 ) ( 6 ) —

( 285 ) ( 290 ) ( 298 )

Depreciation expense ( 285 )

Equity based compensation ( 31 )

( 31 ) ( 34 ) ( 29 )

Other items (6)

Earnings before interest and income taxes 343 523 259

Net financing charges ( 189 )

Other pension income (expense) ( 21 ) ( 33 ) 10

Income before income taxes $ 133 $ 295 $ 54

(1) Corporate-related costs not allocated to the segments include executive office, communications, corporate development, legal and corporate finance.

(2) Reflects restructuring charges for costs that are probable and reasonably estimable and one-time asset impairments.

During fiscal 2024, an impairment charge of $ 9 million related to Adient’s investment in Adient Aerospace was recorded.

During fiscal 2022, an impairment charge of $ 4 million related to the withdrawal from and sale of its operations in Russia, and a held-for-sale impairment charge of $ 6 million were recorded in EMEA.

Refer to Note 15, “Restructuring and Impairment Costs,” of the notes to the consolidated financial statements for more information.

Other pension expense ( 21 )

Income (loss) before income taxes 133

(1) Certain corporate-related costs are not allocated to the segments including executive office, communications, corporate development, legal and corporate finance.

(2) Reflects restructuring charges for costs that are probable and reasonably estimable and non-recurring asset impairments, including restructuring charges of $ 159 million and an impairment charge of $ 9 million related to Adient’s investment in Adient Aerospace.

Refer to Note 15, “Restructuring and Impairment Costs” of the notes to the consolidated financial statements for additional information.

(3) Reflects amortization of intangible assets including those related to partially-owned affiliates recorded within equity income.

(4) Reflects restructuring-related charges for costs that are recorded as incurred or as earned and other non-recurring impacts that are directly attributable to restructuring activities, including a $ 10 million gain on sale of a restructured facility in Americas recorded in SG&A, offset by $ 10 million in restructuring-related charges primarily recorded in cost of sales.

(5) Includes an $ 8 million loss on sale of 51 % of Adient's interest in LFADNT, partially offset by a $ 1 million gain on sale of a partially-owned affiliate recorded within equity income.

Refer to Note 3, “Acquisitions and Divestitures,” of the notes to the consolidated financial statements for additional information.

(6) Includes a $ 3 million non-recurring gain on a contract related settlement and $ 1 million of indirect tax recoveries in Brazil, partially offset by $ 1 million one-time divestiture related tax impact at a partially-owned affiliate recorded within equity income and $ 1 million of transaction costs.

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September 30, 2023

(in millions) Americas EMEA Asia Consolidated

Segment net sales $ 7,220 $ 5,195 $ 3,085 $ 15,500

Eliminations ( 105 )

Consolidated net sales $ 15,395

Material costs 4,755 3,268 2,096

Labor and overhead 1,926 1,517 463

Administrative, engineering and allocated costs 206 193 134

Equity income 3 15 72

Adjusted EBITDA $ 336 $ 232 $ 464 $ 1,032

Reconciliation to income (loss) before income taxes

Corporate-related costs (1)

Restructuring and impairment costs (2)

Purchase accounting amortization (3)

Restructuring-related activities (4)

Loss on disposal transactions (5)

Depreciation expense ( 290 )

Equity based compensation ( 34 )

Other items (6)

Net financing charges ( 195 )

Other pension expense ( 33 )

Income (loss) before income taxes 295

(1) Certain corporate-related costs are not allocated to the segments including executive office, communications, corporate development, legal and corporate finance.

(2) Reflects restructuring charges for costs that are probable and reasonably estimable and non-recurring asset impairments.

Fiscal 2023 reflects restructuring charges of $ 40 million.

Refer to Note 15, “Restructuring and Impairment Costs” of the notes to the consolidated financial statements for additional information.

(3) Reflects amortization of intangible assets including those related to partially-owned affiliates recorded within equity income.

(4) Reflects restructuring-related charges for costs that are recorded as incurred or as earned and other non-recurring impacts that are directly attributable to restructuring activities.

Fiscal 2024 and 2023 also each include a non-recurring $ 10 million gain on the sale of two restructured facilities in Americas.

(5) Fiscal 2024 reflects an $ 8 million loss on sale of 51 % of Adient's interest in LFADNT (as described in Note 3, "Acquisitions and Divestitures," of the notes to consolidated financial statements), partially offset by a $ 1 million gain on sale of a nonconsolidated partially-owned affiliate.

Fiscal 2023 reflects $ 3 million and $ 3 million of non-cash impairment related to certain of Adient's investments in nonconsolidated partially-owned affiliates in Asia and EMEA, respectively,

(6) Fiscal 2024 reflects a $ 3 million non-recurring gain on a contract related settlement and $ 1 million of indirect tax recoveries in Brazil, partially offset by $ 1 million of transaction costs and a $ 1 million one-time divestiture related impact at an affiliate.

Fiscal 2023 reflects $ 4 million of one-time divestiture gain at an affiliate and $ 4 million of a gain associated with the retrospective recovery of indirect tax credits in Brazil, partially offset by $ 3 million of transaction costs.

Fiscal 2022 includes $ 3 million and $ 7 million of non-cash impairments of certain of Adient's investments in nonconsolidated partially-owned affiliates in Asia and EMEA, respectively, $ 8 million of transaction costs, a $ 14 million charge related to a non-recurring contract related settlement, $ 1 million of accounts receivable allowances resulting from the withdrawal from and sale of operations in Russia, and $ 2 million of loss on finalization of asset sale in Turkey, partially offset by a gain of $ 32 million associated with the retrospective recovery of indirect tax credits in Brazil.

(4) Reflects restructuring-related charges for costs that are recorded as incurred or as earned and other non-recurring impacts that are directly attributable to restructuring activities, including a $ 10 million gain on sale of a restructured facility in Americas recorded in SG&A, partially offset by $ 6 million of restructuring-related charges primarily recorded in cost of sales and $ 2 million of restructuring-related charges at a partially-owned affiliate recorded in equity income.

(5) Reflects $ 3 million and $ 3 million of non-cash impairment related to certain of Adient's investments in partially-owned affiliates in Asia and EMEA, respectively, recorded within equity income.

(6) Reflects $ 4 million of one-time divestiture gain at a partially-owned affiliate recorded within equity income and $ 4 million of a gain associated with the retrospective recovery of indirect tax credits in Brazil, partially offset by $ 3 million of transaction costs.

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Additional Segment Information

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(in millions) Americas EMEA Asia

Net Sales $ 6,763 $ 5,029 $ 2,989 $ ( 93 ) $ 14,688

Equity Income 3 15 73 ( 1 ) 90

Total Assets 2,850 2,085 3,042 977 8,954

Investment in partially-owned affiliates 3 37 236 — 276

Equity income — 17 54 ( 3 ) 68

Depreciation 126 106 47 — 279

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Capital Expenditures 94 105 46 — 245

(1) Reconciling items include the elimination of intercompany transactions, corporate-related assets and other amounts to reconcile to consolidated totals.

Specific reconciling items for equity income represents $ 1 million of purchase accounting amortization.

(1) Corporate-related assets primarily include cash and assets held for sale.

Specific reconciling items for equity income represents $ 2 million of purchase accounting amortization, a $ 5 million restructuring charges at an affiliate, partially offset by a $ 4 million gain on a disposal transaction.

Year Ended September 30, 2024

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(in millions) Americas EMEA Asia

Net Sales $ 7,220 $ 5,195 $ 3,085 $ ( 105 ) $ 15,395

Equity Income 3 16 71 ( 6 ) 84

Total Assets 2,863 2,349 3,185 954 9,351

Investment in partially-owned affiliates 28 37 273 — 338

Equity income 3 15 73 ( 1 ) 90

Depreciation 127 112 46 — 285

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Capital Expenditures 100 107 59 — 266

(1) Reconciling items include the elimination of intercompany transactions, corporate-related assets and other amounts to reconcile to consolidated totals.

Specific reconciling items for equity income represents $ 6 million of non-cash impairments of Adient's investments in partially-owned affiliates, $ 2 million of restructuring related charges, and $ 2 million of purchase accounting amortization, partially offset by a $ 4 million gain on sale of certain assets at affiliates in China.

(1) Corporate-related assets primarily include cash and assets held for sale.

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Specific reconciling items for equity income represents $ 2 million of purchase accounting amortization, partially offset by a $ 1 million gain on a disposal transaction.

Year Ended September 30, 2023

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(in millions) Americas EMEA Asia

Net Sales $ 6,557 4,764 $ 2,926 ( 126 ) $ 14,121

Equity Income — 12 76 ( 13 ) 75

Total Assets 3,122 2,252 2,930 1,120 9,424

Investment in partially-owned affiliates 27 38 238 — 303

Equity income 3 15 72 ( 6 ) 84

Depreciation 133 107 50 — 290

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Capital Expenditures 114 81 57 — 252

(1) Reconciling items include the elimination of intercompany transactions, corporate-related assets and other amounts to reconcile to consolidated totals.

Specific reconciling items for equity income represents $ 10 million of non-cash impairments of Adient's investments in partially-owned affiliates, $ 1 million of restructuring related charges, $ 2 million of purchase accounting amortization, $ 7 million of a non-recurring customer termination charge at an affiliate in Asia, partially offset by a $ 7 million non-recurring gain on sale of land use rights at an affiliate in China.

Corporate-related assets primarily include cash and deferred income tax assets.

(1) Corporate-related assets primarily include cash and assets held for sale.

Specific reconciling items for equity income represents $ 6 million of non-cash impairments of Adient's investments in partially-owned affiliates, $ 2 million of restructuring-related charges, and $ 2 million of purchase accounting amortization, partially offset by a $ 4 million gain on sale of certain assets at affiliates in China.

Adient plc | Form 10-K | 100

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Poland 846 939 963

Spain 718 744 725

Czech Republic 694 756 900

Sweden 545 567 517

Romania 500 474 481

Other EMEA 1,711 1,951 1,991

2 unchanged sentences

China 1,286 1,420 1,385

Thailand 496 564 508

Korea 535 488 534

Thailand 515 496 564

Japan 415 344 373

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Other Americas 20 17

Germany 127 127

Poland 155 155

Germany 122 127

Hungary 38 31

Czech Republic 28 35

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During fiscal 2023, Adient concluded that indicators of other-than-temporary impairment were present related to nonconsolidated partially-owned affiliates in Asia and EMEA, and recorded non-cash impairment charges of $ 3 million and $ 3 million as a result, respectively.

In fiscal 2023 and 2022, Adient and KEIPER have modified existing supply agreements, resulting in reductions in Adient’s purchase prices on certain products.

Such modifications resulted in reductions of $ 25 million and $ 34 million in Adient’s cost of sales and equity income, respectively, during fiscal 2023.

The modifications resulted in reductions of $ 14 million and $ 17 million in Adient’s cost of sales and equity income, respectively, during fiscal 2022.

Since fiscal 2023, Adient and KEIPER have continued to strategically modify their supply agreement, including the addition of a performance-based rebate in fiscal 2025, resulting in lower levels of equity income from KEIPER, partially offset by lower cost of sales within Adient.

Commitments and Contingencies

Adient is involved in various lawsuits, claims and proceedings incident to the operation of its businesses, including those pertaining to product liability, casualty, environmental, safety and health, intellectual property, employment, trade compliance, commercial and contractual matters, and various other matters.

Adient is involved in various lawsuits, claims and proceedings incident to the operation of its businesses, including those pertaining to product recall, product liability, casualty, environmental, safety and health, intellectual property, employment, trade compliance, commercial and contractual matters, and various other matters.

Although the outcome of any such lawsuit, claim or proceeding cannot be predicted with certainty and some may be disposed of unfavorably to Adient, it is management's opinion that none of these will have a material adverse effect on Adient's financial position, results of operations or cash flows.

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Accounts payable due to related parties Accounts payable 58 114

Average receivable and payable balances with related parties remained consistent with the period end balances shown above.

Refer to Note 3, “Acquisitions and Divestitures,” of the notes to the consolidated financial statements for transactions involving Adient's investments in nonconsolidated partially-owned affiliates which have impacted Adient's related party transactions.

Adient plc | Form 10-K | 104

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data