Overview

Goodyear is a leading global tire manufacturer operating in most regions worldwide. In November 2023, Goodyear announced a new strategic plan called Goodyear Forward to optimize its product portfolio, expand profit margins, and reduce debt. Key goals include reviewing three major asset groups, optimizing brand positioning, reducing costs by $1 billion, and lifting segment operating margins to 10% by end of 2025.

In Q1 2024, Goodyear Forward delivered $72 million in benefits. However, results were impacted by a fire at the Debica, Poland plant which is still ramping up production. Overall tire unit shipments fell 3.3% due to lower global replacement tire volume, partially offset by higher original equipment volume in Asia Pacific. Goodyear reported lower sales and a reduced net loss compared to Q1 2023.

Financial Performance

• Net sales decreased 8.2% to $4.54 billion due to lower volume, price/mix, unfavorable currency, and a drop in other tire-related business sales
• Net loss narrowed to $57 million from $101 million
• Total segment operating income rose 97.6% to $247 million due to raw material savings, lower costs, Goodyear Forward benefits, and other factors

Regional Results

• Americas unit sales fell 7.4% on lower replacement volume but operating income rose 126.6% on raw material savings, lower costs, and Goodyear Forward
• EMEA unit sales decreased 5.2%; operating income was flat as raw material savings were offset by various headwinds
• Asia Pacific unit sales grew 10.0% on higher original equipment volume; operating income increased 57.9% on raw material savings

Liquidity

• Goodyear ended Q1 2024 with $893 million in cash, down from $902 million
• Had $3.3 billion in liquidity available under various credit facilities
• Net cash used in operations was $451 million including $539 million used for working capital

Outlook

• Expect $75 million in Q2 2024 benefits from Goodyear Forward
• Project flat global unit volume in Q2 2024, excluding tornado impact
• See lower raw material costs but higher inflationary pressures
• Target at least $375 million in full year 2024 savings from Goodyear Forward

Tables

Americas Segment Q1 2024 vs. Q1 2023

|| Q1 2024 | Q1 2023 | Change | Percent Change ||

Tire Units	19.0	20.5	(1.5)	(7.4%)
Net Sales	$2,588	$2,867	$(279)	(9.7%)
Operating Income	$179	$79	$100	126.6%
Operating Margin	6.9%	2.8%

EMEA Segment Q1 2024 vs. Q1 2023

|| Q1 2024 | Q1 2023 | Change | Percent Change ||

Tire Units	12.5	13.2	(0.7)	(5.2%)
Net Sales	$1,347	$1,492	$(145)	(9.7%)
Operating Income	$8	$8	$—	0.0%
Operating Margin	0.6%	0.5%

Asia Pacific Segment Q1 2024 vs. Q1 2023

|| Q1 2024 | Q1 2023 | Change | Percent Change ||

Tire Units	8.9	8.1	0.8	10.0%
Net Sales	$602	$582	$20	3.4%
Operating Income	$60	$38	$22	57.9%
Operating Margin	10.0%	6.5%

In summary, Goodyear delivered improved Q1 2024 earnings through raw material savings and its Goodyear Forward plan, although economic headwinds remain. The company appears on track to achieve its full-year goals while proactively positioning its business for long-term success.