Magna International Inc. (NYSE:MGA) had a busy Friday. The automotive supplier beat third-quarter 2026 earnings and revenue estimates, raised its full-year free cash flow forecast, and announced a new share repurchase program. That is the corporate equivalent of showing up to a meeting with good news, better news, and a checkbook.

The numbers: adjusted earnings of $1.83 per share against an analyst consensus of $1.59. That is up 38% from $1.33 per share a year earlier. Revenue slipped 4% year over year to $10.059 billion, but still cleared Wall Street's $10.014 billion estimate. Declining sales with rising profits is the kind of combination that makes a CFO smile and a purchasing manager sweat.

Margins Get Fatter While Sales Get Thinner

Adjusted earnings before interest and taxes rose 11% to $683 million from $613 million. The adjusted EBIT margin expanded 90 basis points to 6.8% from 5.9%, driven by productivity improvements, favorable commercial items, and tariff recoveries. Tariff recoveries, for those keeping score at home, are the financial equivalent of finding money in an old coat pocket, except the coat is a supply chain.

Net income attributable to Magna climbed to $383 million from $305 million. GAAP earnings rose 33% to $1.44 per share from $1.08. The company credited improved operating profit, lower interest expenses, a reduced effective tax rate, and fewer diluted shares outstanding following repurchases. Fewer shares doing the same work is a reliable way to make each one look better.

Seating Systems Takes A Seat, Unfortunately

Not every segment got the memo. Seating Systems revenue fell 18% to $1.247 billion from $1.520 billion, and adjusted EBIT dropped 55% to $28 million from $62 million. The segment's adjusted EBIT margin contracted to 2.2% from 4.1%, reflecting lower sales and higher launch costs. Launch costs are the industry's polite term for spending money before you make any.

Elsewhere, things looked sturdier. Body Exteriors & Structures revenue edged higher to $4.158 billion from $4.147 billion, while adjusted EBIT jumped 27% to $387 million from $305 million. Power & Vision revenue declined 2% to $3.773 billion from $3.854 billion, but adjusted EBIT rose 22% to $287 million from $236 million. Complete Vehicles revenue fell 8% to $996 million from $1.085 billion, while adjusted EBIT increased 14% to $33 million from $29 million. Complete vehicle assembly volumes, meanwhile, jumped 76% to 25,800 units from 14,700 units. Fewer dollars, more vehicles. Automotive math is a strange and wonderful thing.

Magna also booked $83 million in restructuring charges during the quarter. That included $76 million tied to European plant closures and significant rightsizing in its Power & Vision segment, plus $7 million for rightsizing at a European Body Exteriors & Structures facility. The company pointed to lower global vehicle production, discontinued programs, and the divestitures of its Lighting and Rooftop Systems businesses as drags on sales.

The backdrop did not help. Global light vehicle production declined 3%, including drops of 5% in North America and 7% in China, partially offset by a 3% increase in Europe. When the whole industry produces fewer cars, the companies that supply the parts feel it first.

Cash Flow Gets A Raise, Revenue Gets A Haircut

Magna lowered its 2026 revenue forecast to $41.2 billion-$42 billion from $41.3 billion-$42.5 billion, citing weaker expected vehicle production in China and unfavorable program mix. It narrowed its adjusted earnings forecast to $6.85-$7.15 per share from $6.70-$7.30, keeping the $7 midpoint intact. The adjusted EBIT margin forecast narrowed to 6.3%-6.5% from 6.3%-6.6%.

The free cash flow forecast, however, went the other way: up to $1.85 billion-$1.90 billion from $1.75 billion-$1.85 billion. Third-quarter operating cash flow increased 4% to $950 million from $912 million, while free cash flow rose to $584 million from $572 million. Through the first nine months, free cash flow totaled $1.573 billion versus $560 million a year earlier. That latest figure included customer recoveries tied to contract adjustments on certain North American electric vehicle programs. Contract adjustments are what happens when the original deal meets reality and everyone agrees to pretend the new number was the plan all along.

The Buyback: 10% Of The Float, Give Or Take

Magna returned $658 million to shareholders during the quarter. That included $529 million through the repurchase of 7.9 million shares and $129 million in dividends. For the first nine months, the company bought back 22.9 million shares for $1.434 billion and paid $397 million in dividends.

Now the board has approved a new repurchase program covering approximately 25.8 million shares, representing 10% of its public float, subject to Toronto Stock Exchange approval. The program is expected to begin Nov. 9, 2026, and end no later than Nov. 8, 2027. A buyback of that size is not a subtle hint. It is a statement of intent written in capital allocation.

The board also declared a quarterly dividend of 49.5 cents per share, payable Nov. 27 to shareholders of record Nov. 13.

CEO Swamy Kotagiri said disciplined execution and operational improvements are driving stronger earnings, margins, and cash generation. He added that Magna remains focused on finishing 2026 strongly and plans to outline its strategic priorities and longer-term outlook at its Investor Day on Nov. 11. Investor Day, for the uninitiated, is where companies explain why the next few years will be even better than the last few. Sometimes they are even right.

MGA Price Action: Magna International shares closed at $64.70 on Thursday, up 1.11%, according to market data.