Automotive safety systems provider Autoliv (NYSE: ALV) beat Wall Street’s revenue expectations in Q2 CY2026, with sales up 3.3% year on year to $2.80 billion. Its non-GAAP profit of $2.43 per share was 1.3% below analysts’ consensus estimates.
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Autoliv (ALV) Q2 CY2026 Highlights:
- Revenue: $2.80 billion vs analyst estimates of $2.76 billion (3.3% year-on-year growth, 1.6% beat)
- Adjusted EPS: $2.43 vs analyst expectations of $2.46 (1.3% miss)
- Operating Margin: 6.8%, down from 9.1% in the same quarter last year
- Free Cash Flow Margin: 12.1%, up from 6% in the same quarter last year
- Market Capitalization: $9.15 billion
Company Overview
With products estimated to save over 30,000 lives annually in traffic accidents worldwide, Autoliv (NYSE: ALV) develops and manufactures passive safety systems for vehicles, including airbags, seatbelts, and steering wheels that protect occupants during crashes.
Revenue Growth
Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can have short-term success, but a top-tier one grows for years. Regrettably, Autoliv’s sales grew at a tepid 4.7% compounded annual growth rate over the last five years. This was below our standard for the industrials sector and is a tough starting point for our analysis.
We at StockStory place the most emphasis on long-term growth, but within industrials, a half-decade historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. Autoliv’s recent performance shows its demand has slowed as its annualized revenue growth of 2.4% over the last two years was below its five-year trend. We’re wary when companies in the sector see decelerations in revenue growth, as it could signal changing consumer tastes aided by low switching costs. 
This quarter, Autoliv reported modest year-on-year revenue growth of 3.3% but beat Wall Street’s estimates by 1.6%.
Looking ahead, sell-side analysts expect revenue to grow 1.4% over the next 12 months, similar to its two-year rate. This projection doesn’t excite us and indicates its newer products and services will not catalyze better top-line performance yet.
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Operating Margin
Autoliv has done a decent job managing its cost base over the last five years. The company has produced an average operating margin of 8.2%, higher than the broader industrials sector.
Analyzing the trend in its profitability, Autoliv’s operating margin rose by 2.7 percentage points over the last five years, as its sales growth gave it operating leverage. Its expansion was impressive, especially when considering most Automobile Manufacturing peers saw their margins plummet.
In Q2, Autoliv generated an operating margin profit margin of 6.8%, down 2.3 percentage points year on year. Conversely, its revenue and gross margin actually rose, so we can assume it was less efficient because its operating expenses like marketing, R&D, and administrative overhead grew faster than its revenue.
Earnings Per Share
We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.
Autoliv’s EPS grew at 8.4% compounded annual growth rate over the last five years, higher than its 4.7% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.
We can take a deeper look into Autoliv’s earnings to better understand the drivers of its performance. As we mentioned earlier, Autoliv’s operating margin declined this quarter but expanded by 2.7 percentage points over the last five years. Its share count also shrank by 15.4%, and these factors together are positive signs for shareholders because improving profitability and share buybacks turbocharge EPS growth relative to revenue growth. 
Like with revenue, we analyze EPS over a shorter period to see if we are missing a change in the business.
For Autoliv, its two-year annual EPS growth of 6.2% was lower than its five-year trend. We hope its growth can accelerate in the future.
In Q2, Autoliv reported adjusted EPS of $2.43, up from $2.21 in the same quarter last year. Despite growing year on year, this print slightly missed analysts’ estimates, but we care more about long-term adjusted EPS growth than short-term movements. Over the next 12 months, Wall Street expects Autoliv’s full-year EPS to grow 11.1% from $9.99 to $11.10.
Key Takeaways from Autoliv’s Q2 Results
It was encouraging to see Autoliv beat analysts’ revenue expectations this quarter. On the other hand, its EPS slightly missed. Zooming out, we think this was a mixed quarter. The market seemed to be hoping for more, and the stock traded down 3.9% to $120.12 immediately after reporting.
Is Autoliv an attractive investment opportunity at the current price? We think that the latest quarter is only one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).
