Visteon Corp. said its first-quarter net income plunged 78 percent from a year earlier to $14 million, sending shares down.
The Van Buren Township, Mich., supplier of automotive cockpit electronics said operational challenges hampered its margins, but those difficulties are expected to diminish in the second and third quarters.
Gross margin for the first quarter dwindled to $66 million because of lower sales, launch challenges with a curved center information display, inefficiencies associated with a plant transfer in Mexico and timing of engineering expense, Visteon said.
For the quarter, adjusted earnings -- excluding interest, taxes and one-time costs -- fell 61 percent to $41 million.
Revenue for the first quarter fell 10 percent to $737 million. Unfavorable vehicle production volumes and unfavorable currency trends -- partially offset by new business -- were among major factors, the supplier said in a statement.
Europe accounted for 33 percent of first-quarter sales, ahead of the Americas at 24 percent.
The company's shares plunged 21 percent midday to $61.45 after analysts noted the shortfall.
Visteon gained $1.4 billion in lifetime revenue in new business from global automakers in the quarter, down 14 percent year over year.
The company said U.S.-headquartered manufacturers accounted for half of the first-quarter total, with one-third dedicated to electric vehicles. Visteon's digital clusters, displays and SmartCore domain controller were primary drivers of new business in the quarter.
"Our new business wins were strong and well-aligned with key industry technology trends, with one-third for electric vehicles including battery management systems," CEO Sachin Lawande said in a statement. "We are also pleased to extend our success in the commercial vehicle segment with the addition of a secondary heavy-duty truck customer."
Visteon ranks No. 69 on Automotive News' list of the top 100 global automotive parts suppliers, with $3.15 billion in sales to automakers in 2017.
