The Goodyear Tire & Rubber Company recently completed the sale of its off-the-road (OTR) tire business to The Yokohama Rubber Company for a purchase price of approximately $905 million in cash. Following this divestiture, Goodyear has made significant adjustments to its financial statements to reflect the impact of this transaction.
For the three months ended March 31, 2025, Goodyear's net sales were $4,253 million. However, after removing the OTR business and making transaction accounting adjustments, the pro forma net sales stood at $4,249 million. This represented a decrease of $4 million from the reported net sales.
Similarly, for the same period, Goodyear's net income was $118 million. After adjusting for the removal of the OTR business and transaction accounting, the pro forma net income was $15 million, indicating a significant decrease of $103 million from the reported net income.
For the year ended December 31, 2024, Goodyear's net sales were $18,878 million. After the adjustments, the pro forma net sales were $18,653 million, reflecting a decrease of $225 million from the reported net sales.
In terms of net income for the year ended December 31, 2024, Goodyear reported a net income of $60 million. However, after adjusting for the divestiture and transaction accounting, the pro forma net income was $72 million, indicating an increase of $12 million compared to the reported net income.
The adjustments reflect the significant impact of the divestiture of the OTR tire business on Goodyear's financial performance. It’s clear that the company's net sales and net income have been notably affected by this transaction, underscoring the importance of such events in shaping a company's financial outlook. As a result of these announcements, the company's shares have moved -1.43% on the market, and are now trading at a price of $11.385. For the full picture, make sure to review GOODYEAR TIRE & RUBBER CO /OH/'s 8-K report.
