Garrett Motion Inc.GTX

Garrett Motion Inc. Earnings Per Share Disclosure

10-KFiled Feb 19, 20262 min read
Note 22. Earnings Per Share
Basic earnings per share ("EPS") for the years ended December 31, 2025, and 2024, and 2023 is computed using the two-class method. In 2025 and 2024, the DSUs related to the stock-based compensation plan contain non-forfeitable rights to dividends and are considered as participating securities, while in 2023 our Series A Preferred Stock was considered a participating security prior to its conversion into Common Stock and cancellation pursuant to the Transaction. The two-
class method requires an allocation of earnings to all securities that participate in dividends with common shares to the extent that each such security may share in the Company's earnings. Basic EPS is then calculated by dividing undistributed earnings allocated to common stock by the weighted average number of common shares outstanding for the period. Under the two-class method, the impact of these participating securities was immaterial for the years ended December 31, 2025 and 2024.
Diluted EPS for the years ended December 31, 2025 and 2024 is calculated by applying the two-class method for participating securities and then incorporating the dilutive effect of other potential common shares, determined using methods such as the treasury stock method, to arrive at the most dilutive EPS.
Diluted EPS for the year ended December 31, 2023 was calculated by evaluating the impact of both the two-class method and the if-converted method. The two-class method uses net income available to common shareholders and assumes conversion of all potential shares other than the participating securities. The if-converted method uses net income and assumes conversion of all potential shares including the participating securities. Diluted EPS for the year ended December 31, 2023 was disclosed under the two-class method.
The details of the EPS calculations for the years ended December 31, 2025, 2024 and 2023 are as follows:
Year Ended December 31
202520242023
(Dollars in millions except per share amounts)
Basic earnings per share:
Net Income$310 $282 $261 
Less: preferred stock dividend— — (80)
Less: preferred stock deemed dividends— — (232)
     Net income (loss) available for distribution310 282 (51)
Weighted average common shares outstanding - Basic199,758,058 222,316,484 166,595,397 
EPS – Basic$1.55 $1.27 $(0.31)
Diluted earnings per share:
Weighted average common shares outstanding - Basic199,758,058 222,316,484 166,595,397 
Dilutive effect of unvested RSUs and other contingently issuable shares3,865,940 1,804,672 — 
Weighted average common shares outstanding – Diluted203,623,998 224,121,156 166,595,397 
EPS – Diluted$1.52 $1.26 $(0.31)
For the periods where a net loss attributable to common shareholders is present, dilutive securities have been excluded from the calculation of diluted net loss per share attributable to common stockholders as including them would have been anti-dilutive. For the year ended December 31, 2023, the weighted-average number of unvested RSUs and other contingently issuable shares excluded from the computations was 1,490,117 shares.

Historical Timeline

Fiscal YearFiled
2025Feb 19, 2026Showing above
2024Feb 20, 2025
2023Feb 15, 2024
2022Feb 14, 2023
2021Feb 14, 2022
2020Feb 16, 2021
2019Feb 27, 2020
2018Mar 1, 2019

About Earnings Per Share Disclosures

The earnings per share disclosure breaks down the calculation from net income to both basic and diluted EPS, revealing the full impact of a company's capital structure on per-share economics. The reconciliation between basic and diluted share counts exposes how many stock options, RSUs, convertible securities, and warrants are potentially dilutive to existing shareholders.

Key signals: a widening gap between basic and diluted shares indicates growing dilution from equity compensation or convertible instruments. Anti-dilutive securities excluded from the diluted calculation deserve attention — they represent latent dilution that will materialize if the stock price rises. Watch for the effect of share buybacks on per-share metrics: EPS growth driven primarily by repurchases rather than income growth signals weakening fundamentals. Compare year-over-year changes in the diluted share count against equity compensation expense to assess whether management is effectively managing dilution.

Other Available Disclosures

Income TaxesRevenueFair ValuePP&EGoodwill & IntangiblesLeasesDebtCommitmentsStock CompensationNew Standards