NOTE 8.5. Goodwill and Other Intangible Assets

Intangible assets, net are comprised of the following:


		March 31, 2022						December 31, 2021
(In millions)	Estimated Weighted Average Useful Life (years)	Gross Intangibles		Accumulated Amortization		Net Intangibles		Gross Intangibles		Accumulated Amortization		Net Intangibles
Definite-Lived:
Developed technology	10	$	41	$	(39)	$	2	$	41	$	(39)	$	2
Customer related	10	97		(78)		19		96		(75)		21
Capitalized software development	5	48		(10)		38		48		(10)		38
Other	32	16		(9)		7		15		(8)		7
Subtotal		202		(136)		66		200		(132)		68
Indefinite-Lived:
Goodwill		50		—		50		50		—		50
Total		$	252	$	(136)	$	116	$	250	$	(132)	$	118

Capitalized software development consists of software development costs intended for integration into customer products.

NOTE 6. Other Assets

Other current assets are comprised of the following components:


	March 31,		December 31,
(In millions)	2022		2021
Non-consolidated receivables	$	49	$	48
Recoverable taxes	48		40
Contractually reimbursable engineering costs	35		34
Prepaid assets and deposits	29		21
Derivative financial instruments	6		2
Royalty agreements	3		4
China bank notes	1		3
Other	5		6
	$	176	$	158

September 30 December 31
2017 2016
(Dollars in Millions)
Recoverable taxes $ 61
$ 60
Joint venture receivables 37
39
Prepaid assets and deposits 36
35
Notes receivable 28
18
Contractually reimbursable engineering costs 15
7
Foreign currency hedges 1
6
Other 3
5
$ 181
$ 170

The Company receives bank notes from certain ~~of its~~ customers in China to settle trade accounts receivable. The Company may hold such bank notes until maturity, exchange them with suppliers to settle liabilities, or sell them to third party financial institutions in exchange for cash. The Company has entered into arrangements with financial institutions to sell certain bank notes, generally maturing within nine months. Notes are sold with recourse, but qualify as a sale as all rights to the notes have passed to the financial institution. The Company sold $11 million during the nine months ended September 30, 2017 to financial institutions, $5 million of which occurred in the third quarter and will mature within the first half of 2018. The collection of such bank notes are included in operating cash flows based on the substance of the underlying transactions which are operating in nature. The Company redeemed $46 million and $51 million of China bank notes during the three months ended March 31, 2022 and 2021, respectively. Remaining amounts outstanding at third-party institutions related to sold bank notes will mature by the end of the third quarter of 2022.

Other non-current assets are comprised of the following components:

September 30 December 31
2017 2016
(Dollars in Millions)
Deferred tax assets $ 49
$ 48
Recoverable taxes 36
34
Joint venture receivables 26
25
Contractually reimbursable engineering costs 19
11
Long term notes receivable 10
10
Other 14
18
$ 154
$ 146

~~In conjunction with the Interiors Divestiture, the Company entered into a three year term loan with the buyer for $10 million, which matures on December 1, 2019.~~


	March 31,		December 31,
(In millions)	2022		2021
Deferred tax assets	$	48	$	47
Contractually reimbursable engineering costs	30		34
Recoverable taxes	10		9
Pension assets	6		7
Royalty agreements	1		2

Other	16		12
	$	111	$	111

Current and non-current contractually reimbursable engineering costs ~~of $15 million and $19 million, respectively, as of September 30, 2017 and $7 million and $11 million, respectively, as of December 31, 2016,~~ are related to pre-production design and development costs incurred pursuant to long-term supply arrangements that are contractually guaranteed for reimbursement by customers. The Company expects to receive cash reimbursement payments of ~~approximately $8~~$27 million during the remainder of ~~2017, $10~~2022, $28 million in ~~2018, $9~~2023, $8 million in ~~2019, $2~~2024, $1 million in ~~2020~~2025, and $5$1 million in ~~2021.~~2026 and beyond.

~~Table of Contents~~

~~NOTE 9. Intangible Assets, net~~

~~Intangible assets, net as of September 30, 2017 and December 31, 2016, are comprised of the following:~~

September 30, 2017 December 31, 2016
Estimated Weighted Average Useful Life (years) Gross Carrying Value Accumulated Amortization Net Carrying Value Gross Carrying Value Accumulated Amortization Net Carrying Value
(Dollars in Millions)
Definite-Lived:
Developed technology 10 $ 41
$ 28
$ 13
$ 40
$ 25
$ 15
Customer related 9 85
31
54
83
25
58
Capitalized software development 3 6
—
6
4
—
4
Other 32 10
1
9
8
1
7
Subtotal 142
60
82
135
51
84
Indefinite-Lived:
Goodwill 46
—
46
45
—
45
Total $ 188
$ 60
$ 128
$ 180
$ 51
$ 129

The Company recorded approximately $3 million and $9 million of amortization expense related to definite-lived intangible assets for the three and nine months ended September 30, 2017. The Company currently estimates annual amortization expense to be $13 million for 2017, $14 million for 2018 and 2019, $11 million for 2020, and $9 million for 2021. Indefinite-lived intangible assets are not amortized but are tested for impairment at least annually, or earlier when events and circumstances indicate that it is more likely than not that such assets have been impaired. There were no indicators of potential impairment during the nine months ended September 30, 2017.

During the three months ended September 30, 2017, the Company contributed $2 million to a non-profit corporation who is building a state of the art research and development facility. The contribution provides the Company certain rights regarding access to the facility for three years. The Company will use the facility for autonomous driving research and development activities for multiple products and therefore capitalized the contribution as an intangible asset. The Company expects to make a second contribution of $2 million during the first half of 2018 when the facility is substantially complete. The asset will be amortized over a 36 month period on a straight-line basis beginning in January 2018 when the term of the arrangement begins.

The Company capitalizes software development costs after the software product development reaches technological feasibility and until the software product becomes releasable to customers. During the nine months ended September 30, 2017, the Company capitalized $2 million related to software development cost intended for external use. The capitalized software development costs are amortized over the useful life of the technology on a straight-line basis.

~~A roll-forward of the carrying amounts of intangible assets is presented below:~~

Definite-lived intangibles Indefinite-lived intangibles
Developed Technology Customer Related Capitalized Software Development Other Goodwill Total
(Dollars in Millions)
December 31, 2016 $ 15
$ 58
$ 4
$ 7
$ 45
$ 129
Additions —
—
2
2
—
4
Foreign currency 1
2
—
—
1
4
Amortization (3 ) (6 ) —
—
—
(9 )
September 30, 2017 $ 13
$ 54
$ 6
$ 9
$ 46
$ 128

~~Table of Contents~~

NOTE ~~10.~~7. Other Liabilities

Other current liabilities are summarized as follows:


	March 31,		December 31,
(In millions)	2022		2021
Deferred income	$	59	$	69
Non-consolidated payables	31		20
Product warranty and recall accruals	31		30
Non-income taxes payable	19		26
Restructuring reserves	14		16
Royalty reserves	12		12
Income taxes payable	8		8
Other	40		37
	$	214	$	218

September 30 December 31
2017 2016
(Dollars in Millions)
Product warranty and recall accruals $ 39
$ 43
Contribution payable 35
31
Restructuring reserves 26
40
Rent and royalties 23
23
Foreign currency hedges 22
7
Deferred income 14
14
Distribution payable 14
15
Dividends payable 12
5
Income taxes payable 11
22
Joint venture payables 10
22
Non-income taxes payable 3
8
Electronics operations repurchase commitment —
50
Other 26
29
$ 235
$ 309

On December 1, 2015, Visteon completed the sale and transfer of its equity ownership in Visteon Deutschland GmbH, which operated the Berlin, Germany interiors plant ("Germany Interiors Divestiture"). The Company contributed cash, of approximately $141 million, assets of $27 million, and liabilities of $198 million including pension related liabilities. The Company will make a final contribution payment of approximately $35 million anticipated during 2017 upon fulfillment of buyer contractual commitments.

On January 22, 2016 the Company paid to shareholders a special distribution of $1.74 billion, an additional $14 million will be paid over a two-year period upon vesting and settlement of restricted stock units and performance-based share units previously granted to the Company's employees. The special cash distribution was funded from the Climate Transaction proceeds.

Following the initial sale as part of the Climate Transaction, the Company repurchased an Electronics operation located in India on March 27, 2017 as further described in Note 4, "Discontinued Operations."

Other non-current liabilities are summarized as follows:


	March 31,		December 31,
(In millions)	2022		2021
Product warranty and recall accruals	$	20	$	20
Deferred income	19		15
Derivative financial instruments	8		13
Income tax reserves	8		8
Royalty agreements	4		5
Restructuring reserves	2		2
Other	13		12
	$	74	$	75

September 30 December 31
2017 2016
(Dollars in Millions)
Deferred income $ 16
$ 18
Product warranty and recall accruals 12
12
Income tax reserves 11
14
Non-income tax reserves 8
10
Other 15
15
$ 62
$ 69

~~Table of Contents~~

NOTE ~~11.~~8. Debt

The Company’s ~~short and long-term~~ debt consists of the following:


						March 31,		December 31,
	September 30		December 31
	2017		2016
	(Dollars in Millions)
(In millions)					(In millions)	2022		2021
Short-Term Debt:					Short-Term Debt:
Current portion of long-term debt	$	1	$	3
Short-term borrowings	43		33		Short-term borrowings	$	—	$	4
	$	44	$	36
Long-Term Debt:					Long-Term Debt:
Term debt facility	$	347	$	346

Term debt facility, net					Term debt facility, net	$	349	$	349

Short-Term Debt

Short-term borrowings are ~~primarily~~ related to subsidiary borrowings. As of March 31, 2022, the ~~Company's non-U.S. consolidated joint ventures~~Company has no short-term borrowing and ~~are payable primarily in U.S. Dollars, Chinese Renminbi and India Rupee, or Russian Ruble. The Company had~~there is $150 million available capacity under short-term borrowings of $43 million and $33 million as of September 30, 2017 and December 31, 2016, respectively. Short-term borrowings increased in the third quarter of 2017 primarily due to changes in working capital needs.

~~Available borrowings on outstanding affiliate~~ credit ~~facilities as of September 30, 2017 are approximately $24 million and certain of these facilities have pledged assets as security.~~

facilities.

Long-Term Debt

As of ~~December~~March 31, ~~2016,~~2022, the Company ~~had~~has an amended credit agreement ~~(the “Credit Agreement”~~("Credit Agreement") which ~~included~~includes a $350 million Term Facility maturing ~~April 9, 2021~~March 24, 2024 and a $400 million Revolving Credit Facility ~~with capacity~~which matures the earlier of ~~$200 million maturing April 9, 2019. Borrowings under~~(i) December 24, 2024, (ii) 90 days prior to the scheduled maturity of the Term Facility, ~~accrued interest at~~or (iii) the ~~greater~~date of ~~LIBOR or 0.75%, plus 2.75%, with an option by~~ the termination of the Company's Credit Agreement.

The Company ~~to specify the LIBOR tenor of either 1, 2, 3, or 6 months. Loans drawn under~~has no outstanding borrowings on the Revolving Credit Facility ~~had an interest~~as of March 31, 2022.

Interest on the Term Facility loans accrue at a rate equal to ~~LIBOR~~a LIBOR-based rate plus aan applicable margin ~~ranging from 2.00% to 2.75% as specified by a ratings grid contained in the Credit Agreement. As~~ of ~~December 31, 2016, borrowings~~1.75% per annum. Loans under the Company's Revolving Credit ~~Facility would accrue interest at LIBOR plus 2.50%. There were no outstanding borrowings at year-end.~~

On March 24, 2017, the Company entered into a second amendment to the Credit Agreement to, among other things, extend the maturity dates of both facilities by three years and increase the Revolving Credit Facility capacity to $300 million. The amended Revolving Credit Facility will mature on March 24, 2022 and the amended Term Facility will mature on March 24, 2024. The amendment reduced the LIBOR spread applicable to each of the Revolving Credit Facility and the Term Facility by 0.50% and reduced the LIBOR floor related to the Term Facility from 0.75% to 0.00%. The $350 million of borrowings under the amended Term Facility accrue interest at a rate equal to a LIBOR-based rate plus an applicable margin of ~~LIBOR plus 2.25%. In conjunction~~between 1.00% and 2.00%, as determined by the Company's total gross leverage ratio.

The Credit Agreement requires compliance with ~~the refinancing the Company received a credit rating upgrade from Standard & Poor's to BB from BB-. Pursuant to the ratings grid contained within the amended~~customary affirmative and negative covenants and contains customary events of default. The Revolving Credit Facility ~~agreement,~~also requires that the Company maintain a total net leverage ratio no greater than 3.50:1.00. During any ~~borrowing thereunder shall accrue interest at LIBOR plus 1.75%. As~~period when the Company’s corporate and family ratings meet investment grade ratings, certain of ~~September 30, 2017, there were no outstanding borrowings under~~ the ~~amended Revolving Credit Facility.~~negative covenants are suspended.

The Revolving Credit Facility also provides $75 million availability for the issuance of letters of credit and a maximum of $20 million for swing line ~~borrowing.~~borrowings. Any amount of the facility utilized for letters of credit or swing line loans outstanding will reduce the amount available under the ~~amended~~existing Revolving Credit Facility. The Company may request increases in the limits under the ~~amended Term Facility and the amended Revolving~~ Credit ~~Facility~~Agreement and may request the addition of one or more term loan ~~facilities under the Credit Agreement.~~facilities. Outstanding borrowings may be prepaid without penalty (other than borrowings made for the purpose of reducing the effective interest rate margin or weighted average yield of the loans). There are mandatory prepayments of principal in connection with: (i) excess cash flow sweeps above certain leverage thresholds, (ii) certain asset sales or other dispositions, (iii) certain refinancing of indebtedness and (iv) over-advances under the Revolving Credit Facility. There are no excess cash flow sweeps required at the Company’s current leverage level.

The Credit Agreement requires the Company and its subsidiaries to comply with customary affirmative and negative covenants, and contains customary events of default. The Revolving Credit Facility also requires that the Company maintain a total net leverage ratio no greater than 3.00:1.00. During any period when the Company’s corporate and family ratings meet investment

~~Table of Contents~~

~~grade ratings, certain of the negative covenants shall be suspended. As of September 30, 2017, the Company was in compliance with all its debt covenants.~~

All obligations under the Credit Agreement and obligations inwith respect ofto certain cash management services and swap transaction agreements ~~with~~between the ~~lenders~~Company and ~~their affiliates~~its lenders are unconditionally guaranteed by certain of the Company’s subsidiaries. Under the terms of the Credit Agreement, ~~all obligations under the Credit Agreement~~any amounts outstanding are secured by a first-priority perfected lien ~~(subject to certain exceptions)~~ on substantially all property of the Company and the subsidiaries party to the ~~Security Agreement,~~security agreement, subject to certain limitations.

~~In connection with amending both the Term Facility and Revolving Credit Facility, the~~

Other

The Company ~~recorded $1~~has a $5 million of interest expense and deferred $2 million of costs as a non-current asset. The deferred costs will be amortized over the term of the debt facilities. As of September 30, 2017, the amended Term Facility remains at $350 million of aggregate principal and there were no outstanding borrowings under the amended Revolving Credit Facility.

~~Other~~

~~On September 29, 2017 the Company amended certain terms of its~~ letter of credit ~~facility. The amended agreement reduced the~~ facility, ~~amount from $15 million to $5 million and extended the expiration date by three years to September 30, 2020. Under the agreement~~whereby the Company is required to maintain a cash collateral account equal to 103% (110% for non-U.S. dollar denominated letters)of the aggregate stated amount of issued letters of credit ~~(or 110% for non-U.S. currencies)~~ and must reimburse any amounts drawn under issued letters of credit. The Company had $2 million of outstanding letters of credit issued under this facility secured by restricted cash, as of ~~September 30, 2017.~~

March 31, 2022. Additionally, the Company had ~~$18~~$5 million of locally issued letters of credit with $1$2 million of collateral as of ~~September 30, 2017,~~March 31, 2022, to support various tax appeals, customs arrangements and other obligations at its local affiliates.

NOTE ~~12.~~9. Employee Benefit Plans

~~Defined Benefit Plans~~

The Company's net periodic benefit costs for all defined benefit plans for the three month periods ended ~~September 30, 2017~~March 31, 2022 and ~~2016~~2021 were as follows:


	U.S. Plans				Non-U.S. Plans
(In millions)	2022		2021		2022		2021
Costs Recognized in Income:
Pension service cost:
Service cost	$	—	$	—	$	—	$	—
Pension financing benefits (cost):
Interest cost	$	(5)	$	(4)	$	(2)	$	(2)
Expected return on plan assets	10		9		2		2
Amortization of losses and other	—		(1)		—		—
Total pension financing benefits:	5		4		—		—



Net pension benefit (cost)	$	5	$	4	$	—	$	—

U.S. Plans Non-U.S. Plans
2017 2016 2017 2016
(Dollars in Millions)
Costs Recognized in Income:
Service cost $ —
$ —
$ 1
$ 1
Interest cost 7
7
2
3
Expected return on plan assets (10 ) (10 ) (2 ) (3 )
Net pension (income) expense $ (3 ) $ (3 ) $ 1
$ 1

~~The~~Pension financing benefits are classified as Other income, net on the Company's ~~net periodic benefit costs for all defined benefit plans for the nine month periods ended September 30, 2017 and 2016 were as follows:~~

U.S. Plans Non-U.S. Plans
2017 2016 2017 2016
(Dollars in Millions)
Costs Recognized in Income:
Service cost $ —
$ —
$ 2
$ 2
Interest cost 21
21
7
9
Expected return on plan assets (30 ) (31 ) (7 ) (9 )
Settlements and curtailments —
—
—
1
Amortization of losses and other —
—
1
—
Net pension (income) expense $ (9 ) $ (10 ) $ 3
$ 3

~~Table~~condensed consolidated statements of ~~Contents~~

comprehensive income.

During the ~~nine~~three months ended ~~September 30, 2017,~~March 31, 2022, cash contributions to the Company's defined benefit plans were ~~less than a~~$1 million ~~for the U.S. plans and $5 million for the~~related to its non-U.S. plans. The Company ~~expects to make~~estimates that total cash contributions to its non-U.S. defined benefit pension plans ~~of $7 million in 2017.~~during 2022 will be $4 million.

On April 28, 2016, the Company purchased a non-participating annuity contract for all participants of the Canada non-represented plan. The annuity purchase covered 52 participants and resulted in the use of $5 million of plan assets for pension benefit obligation settlements of approximately $5 million. In connection with the annuity purchase, the Company recorded a settlement loss of approximately $1 million during the the three months ended September 30, 2016.

NOTE ~~13.~~10. Income Taxes

During the three ~~and nine~~ month ~~periods~~period ended ~~September 30, 2017,~~March 31, 2022, the Company recorded a provision for income tax ~~on continuing operations~~ of $8 million ~~and $34 million, respectively,~~ which reflects income tax expense in countries where the Company is ~~profitable;~~profitable, accrued withholding ~~taxes; changes in uncertain tax benefits;~~taxes, and the inability to record a tax benefit for pretax losses and/or recognize expense for pretax income in certain jurisdictions, ~~(including~~including the United States ("U.S."), due to valuation allowances. ~~Pretax~~Pre-tax losses ~~from continuing operations~~ in jurisdictions where valuation allowances are maintained and no income tax benefits are recognized totaled

~~$13~~ $10 million and ~~$38~~$11 million for the ~~nine months~~three month periods ended ~~September 30, 2017~~March 31, 2022 and ~~September 30, 2016,~~2021, respectively, resulting in an increase in the Company's effective tax rate in those years.

The Company provides for U.S. and non-U.S. income taxes and non-U.S. withholding taxes on the projected future repatriations of the earnings from its non-U.S. operations that are not considered permanently reinvested at each tier of the legal entity structure.

During the nine month periods ended September 30, 2017 and 2016, the Company recognized expense primarily related to non-U.S. withholding taxes of $6 million and $3 million, respectively, reflecting the Company's forecasts which contemplate numerous financial and operational considerations that impact future repatriations.

The Company's provision for income taxes in interim periods is computed by applying an estimated annual effective tax rate against income before income taxes, excluding equity in net income of non-consolidated affiliates for the period. Effective tax rates vary from period to period as separate calculations are performed for those countries where the Company's operations are profitable and whose results continue to be tax-effected and for those countries where full deferred tax valuation allowances exist and are maintained. In determining the estimated annual effective tax rate, the Company analyzes various factors, including but not limited to, forecasts of projected annual earnings, taxing jurisdictions in which the pretax income and/or pretax losses will be generated and available tax planning strategies. The Company’s estimated annual effective tax rate is updated each quarter and may be significantly impacted by changes to the mix of forecasted earnings by tax jurisdiction. The tax impact of adjustments to the estimated annual effective tax rate are recorded in the period such estimates are revised. The Company is also required to record the tax impact of certain other non-recurring tax items, including changes in judgment about valuation allowances and uncertain tax positions, and changes in tax laws or rates, in the interim period in which they occur, rather than include them in the estimated annual effective tax rate.

The need to maintain valuation allowances against deferred tax assets in the U.S. and other affected countries will cause variability in the Company’s quarterly and annual effective tax rates. Full valuation allowances against deferred tax assets in the U.S. and applicable foreign countries will be maintained until sufficient positive evidence exists to reduce or eliminate them. The ~~factors considered by management in~~Company evaluates its ~~determination of the probability of the realization of the~~ deferred ~~tax assets include, but~~income taxes quarterly to determine if valuation allowances are not limited to, recent historical financial results, historical taxable income, projected future taxable income, the expected timing of the reversals of existing temporary differences and tax planning strategies. If, based upon the weight of available evidence, it is more likely than not the deferred tax assets will notrequired or should be realized, a valuation allowance is recorded. The weight given to the positive and negative evidence is commensurate with the extent to which the evidence may be objectively verified. As such, it is generally difficult for positive evidence regarding projected future taxable income exclusive of reversing taxable temporary differences to outweigh objective negative evidence of recent financial reporting losses, in particular, when there is a cumulative loss incurred over a three-year period. In regards to the full valuation allowance recorded against the U.S. net deferred tax assets, the cumulative U.S. pretax book loss adjusted for significant permanent items incurred over the three-year period ended December 31, 2016 limits the ability to consider other subjective evidence such as the Company’s plans to improve U.S. profits, and as such, the Company continues to maintain a full valuation allowance against the U.S. net deferred tax assets. Based on the Company’s current assessment, it is possible that within the next 12 to 24 months, the existing valuation allowance against the U.S. net deferred tax assets could be partially released. Any such release is dependent upon the sustained improvement in U.S. operating results, and, if such a release of the valuation allowance were to occur, it could have a significant impact on net income in the quarter in which it is deemed appropriate to partially release the reserve.adjusted.

~~Table of Contents~~

~~Unrecognized Tax Benefits~~

Gross unrecognized tax benefits as of September 30, 2017 and December 31, 2016, including amounts attributable to discontinued operations, were $17 million and $35 million, respectively. Of these amounts approximately $8 million and $12 million as of September 30, 2017 and December 31, 2016, respectively, represent the amount of unrecognized benefits that, if recognized, would impact the effective tax rate. The gross unrecognized tax benefit differs from that which would impact the effective tax rate due to uncertain tax positions embedded in other deferred tax attributes carrying a full valuation allowance. If the uncertainty is resolved while a full valuation allowance is maintained, these uncertain tax positions should not impact the effective tax rate in current or future periods. The Company records interest and penalties related to uncertain tax positions as a component of income tax expense and related amounts accrued at September 30, 2017 and December 31, 2016 were $3 million and $4 million, respectively.

During the first quarter of ~~2017, the IRS completed the audit of the Company's U.S. tax returns for the 2012 and 2013 tax years. The closing of the audit did not have a~~2022, there were no material ~~impact on the Company's effective tax rate due to the valuation allowances maintained against the Company's U.S. tax attributes resulting~~changes in a decrease in unrecognized tax benefits of $16 million. Also during the first quarter of 2017, the Company settled tax assessments from the Mexican tax authorities in the amount of $2 million related to certain transfer pricing-related issues. During the third quarter of 2017, the Company settled tax assessments in connection with the Company’s former operations in Spain and France in the amount of $1 million.

With few exceptions, the Company is no longer subject to U.S. federal tax examinations for years before 2014, or state, local or non-U.S. income tax examinations for years before 2003, although U.S. net operating losses carried forward into open tax years technically remain open to adjustment. During the second quarter of 2017, the IRS contacted the Company to begin the examination process of the Company’s U.S. tax returns for 2014 and 2015. Although it is not possible to predict the timing of the resolution of all ongoing tax audits with accuracy, it is reasonably possible that certain tax proceedings in Europe, Asia and Mexico could conclude within the next twelve months and result in a significant increase or decrease in the balance of gross unrecognized tax benefits. Given the number of years, jurisdictions and positions subject to examination, the Company is unable to estimate the full range of possible adjustments to the balance of unrecognized tax benefits. The long-term portion of uncertain income tax positions (including interest) ~~in the amount~~ of ~~$11~~$8 million is included in ~~Other~~other non-current liabilities on the condensed consolidated balance sheet, while $3 million is reflected as a reduction of a deferred tax asset related to a net operating loss included in other non-current assets on the condensed consolidated balance sheet.

~~A reconciliation of the beginning and ending amount of unrecognized tax benefits including amounts attributable to discontinued operations is as follows:~~

Nine Months Ended
September 30, 2017
(Dollars in Millions)
Beginning balance $ 35
Tax positions related to current period:
Additions 2
Tax positions related to prior periods:
Reductions (21 )
Effect of exchange rate changes 1
Ending balance $ 17

During 2012, Brazil tax authorities issued tax assessment notices to Visteon Sistemas Automotivos (“Sistemas”) related to the sale of its chassis business to a third party, which required a deposit in the amount of $15 million during 2013 necessary to open a judicial proceeding against the government in order to suspend the debt and allow Sistemas to operate regularly before the tax authorities after attempts to reopen an appeal of the administrative decision failed. Adjusted for currency impacts and accrued interest, the deposit amount is approximately $16 million, as of September 30, 2017. The Company believes that the risk of a negative outcome is remote once the matter is fully litigated at the highest judicial level. These appeal payments, as well as Outstanding income tax refund claims ~~associated with other~~related primarily to India and Brazil jurisdictions, total ~~$19~~$7 million as of ~~September 30, 2017,~~March 31, 2022, and are included in ~~"Other~~other non-current ~~assets"~~assets on the condensed consolidated balance ~~sheet.~~

sheets.

~~Table of Contents~~

NOTE ~~14.~~11. Stockholders’ Equity and Non-controlling Interests

Non-Controlling Interests

~~Changes in equity for the three and nine months ended September 30, 2017 and 2016~~The Company's non-controlling interests are as follows:

2017 2016
Visteon NCI Total Visteon NCI Total
(Dollars in Millions)
Three Months Ended September 30
Beginning balance $ 569
$ 136
$ 705
$ 616
$ 148
$ 764
Net income from continuing operations 43
4
47
21
4
25
Net income from discontinued operations —
—
—
7
—
7
Net income 43
4
47
28
4
32
Other comprehensive income (loss)
    Foreign currency translation adjustments 17
2
19
7
—
7
    Net investment hedge (7 ) —
(7 ) (4 ) —
(4 )
    Benefit plans (1 ) —
(1 ) —
—
—
    Unrealized hedging gain 1
—
1
—
—
—
    Total other comprehensive income 10
2
12
3
—
3
Stock-based compensation, net 3
—
3
1
—
1
Share repurchase

(10 ) —
(10 ) —
—
—
Dividends to non-controlling interests —
(24 ) (24 ) —
(6 ) (6 )
Ending balance $ 615
$ 118
$ 733
$ 648
$ 146
$ 794

2017 2016
Visteon NCI Total Visteon NCI Total
(Dollars in Millions)
Nine Months Ended September 30
Beginning balance $ 586
$ 138
$ 724
$ 1,057
$ 142
$ 1,199
Net income from continuing operations 143
11
154
88
12
100
Net income (loss) from discontinued operations 8
—
8
(15 ) —
(15 )
Net income 151
11
162
73
12
85
Other comprehensive income (loss)
    Foreign currency translation adjustments 57
4
61
32
(2 ) 30
    Net investment hedge (20 ) —
(20 ) (6 ) —
(6 )
    Benefit plans (2 ) —
(2 ) 1
—
1
    Unrealized hedging gain (loss) 4
—
4
(4 ) —
(4 )
    Total other comprehensive income (loss) 39
4
43
23
(2 ) 21
Stock-based compensation, net 9
—
9
(5 ) —
(5 )
Share repurchase (170 ) —
(170 ) (500 ) —
(500 )
Dividends to non-controlling interests —
(35 ) (35 ) —
(6 ) (6 )
Ending balance $ 615
$ 118
$ 733
$ 648
$ 146
$ 794

~~Share Repurchase Program~~

During 2016, Visteon completed two stock buyback programs with a third-party financial institution to purchase shares of common stock for an aggregate purchase price of $500 million. Under these programs, Visteon purchased 7,190,506 shares at an average price of $69.48.

On January 10, 2017, the Company's board of directors authorized $400 million of share repurchase of its shares of common stock through. On February 27, 2017 the Company entered into an accelerated share buyback ("ASB") program with a third-party financial institution to purchase shares of Visteon common stock for an aggregate purchase price of $125 million. On March 2, 2017, the Company received an initial delivery of 1,062,022 shares of common stock using a reference price of $94.16. The

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~~program was concluded in May 2017 and the Company received an additional 238,344 shares. In total, the Company purchased 1,300,366 shares at an average price of $96.13 under this ASB program.~~

During the second quarter of 2017, the Company entered into a brokerage agreement with a third party financial institution to execute open market share purchases of the Company's common stock. The Company paid approximately $35 million to repurchase 359,100 shares at an average price of $97.44.

~~During the third quarter of 2017, the Company paid approximately $10 million to repurchase 82,513 shares on the open market at an average price of $121.25.~~

The Company anticipates that additional repurchases of common stock, if any, would occur from time to time in open market transactions or in privately negotiated transactions depending on market and economic conditions, share price, trading volume, alternative uses of capital and other factors.

~~Non-Controlling Interests~~

~~Non-controlling interests in the Visteon Corporation economic entity are as follows:~~

September 30 December 31
2017 2016
(Dollars in Millions)
Yanfeng Visteon Automotive Electronics Co., Ltd. $ 73
$ 97
Shanghai Visteon Automotive Electronics, Co., Ltd. 43
39
Other 2
2
$ 118
$ 138

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	March 31,		December 31,
(In millions)	2022		2021
Shanghai Visteon Automotive Electronics, Co., Ltd.	$	46	$	45
Yanfeng Visteon Automotive Electronics Co., Ltd.	34		33
Changchun Visteon FAWAY Automotive Electronics, Co., Ltd.	19		20
Other	2		2
	$	101	$	100

Accumulated Other Comprehensive Income (Loss) ~~Income~~

Changes in Accumulated other comprehensive income (loss) ~~income~~ (“AOCI”) and reclassifications out of AOCI by component include:


														Three Months Ended March 31,
	Three Months Ended September 30						Nine Months Ended September 30
	2017			2016			2017			2016
	(Dollars in Millions)
(In millions)													(In millions)	2022		2021
Changes in AOCI:													Changes in AOCI:
Beginning balance	$	(204	)	$	(170	)	$	(233	)	$	(190	)	Beginning balance	$	(229)	$	(304)
Other comprehensive income (loss) before reclassification, net of tax	8			2			34			24			Other comprehensive income (loss) before reclassification, net of tax	4		(18)
Amounts reclassified from AOCI	2			1			5			(1		)	Amounts reclassified from AOCI	—		1
Ending balance	$	(194	)	$	(167	)	$	(194	)	$	(167	)	Ending balance	$	(225)	$	(321)
Changes in AOCI by Component:	Changes in AOCI by Component:												Changes in AOCI by Component:
Foreign currency translation adjustments													Foreign currency translation adjustments
Beginning balance	$	(123	)	$	(134	)	$	(163	)	$	(159	)	Beginning balance	$	(149)	$	(115)
Other comprehensive income before reclassification, net of tax (a)	17			7			57			32
Other comprehensive income (loss) before reclassification, net of tax (a)													Other comprehensive income (loss) before reclassification, net of tax (a)	(7)		(33)
Ending balance	(106		)	(127		)	(106		)	(127		)	Ending balance	(156)		(148)
Net investment hedge													Net investment hedge
Beginning balance	(3		)	2			10			4			Beginning balance	4		(15)
Other comprehensive loss before reclassification, net of tax (a)	(7		)	(4		)	(20		)	(6		)
Other comprehensive income (loss) before reclassification, net of tax (a)													Other comprehensive income (loss) before reclassification, net of tax (a)	8		14
Amounts reclassified from AOCI													Amounts reclassified from AOCI	(2)		(1)
Ending balance	(10		)	(2)			(10		)	(2)			Ending balance	10		(2)
Benefit plans													Benefit plans
Beginning balance	(76		)	(35)			(75		)	(36)
Other comprehensive income before reclassification, net of tax (a)	(1		)	—			(2		)	—
Amounts reclassified from AOCI	—			—			—			1
Ending balance	(77		)	(35		)	(77		)	(35		)
Unrealized hedging (loss) gain
Beginning balance	(2		)	(3		)	(5		)	1			Beginning balance	(81)		(165)
Other comprehensive income (loss) before reclassification, net of tax (b)	(1		)	(1		)	(1		)	(2		)	Other comprehensive income (loss) before reclassification, net of tax (b)	—		1
Amounts reclassified from AOCI	2			1			5			(2		)	Amounts reclassified from AOCI	1		1
Ending balance	(1		)	(3		)	(1		)	(3		)	Ending balance	(80)		(163)
Unrealized hedging gain (loss)													Unrealized hedging gain (loss)
Beginning balance													Beginning balance	(3)		(9)
Other comprehensive income (loss) before reclassification, net of tax (c)													Other comprehensive income (loss) before reclassification, net of tax (c)	3		—
Amounts reclassified from AOCI													Amounts reclassified from AOCI	1		1
Ending balance													Ending balance	1		(8)
Total AOCI	$	(194	)	$	(167	)	$	(194	)	$	(167	)	Total AOCI	$	(225)	$	(321)

(a) There were no income tax effects for either period due to the valuation allowance.

(b) Net tax expense was less than $1 million related to benefit plans for the ~~nine month period ending September 30, 2017. Income~~three months ended March 31, 2022 and 2021.

~~(b) Net tax expense of less than $1 million and $1 million are~~ related to unrealized hedging gain (loss) for either period due to the three and nine month periods ended September 30, 2017, respectively. Net tax benefits of $1 million and less than $1 million are related to unrealized hedging gain for the three and nine month periods ended September 30, 2016, respectively.valuation allowance.

NOTE ~~15.~~12. Earnings Per Share

Basic earnings per share is calculated by dividing net income attributable to Visteon by the weighted average number of shares of common stock outstanding. Diluted earnings per share is ~~computed~~calculated by dividing net income by the weighted average number of common and potentially dilutive common shares outstanding. Performance based share units are considered contingently issuable shares and are included in the computation of diluted earnings per share based on the number of shares that would be issuable if the reporting date were the end of the contingency period and if the result would be dilutive.

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The table below provides details underlying the calculations of basic and diluted earnings ~~(loss)~~ per share:


	Three Months Ended March 31,
(In millions, except per share amounts)	2022		2021
Numerator:


Net income (loss) attributable to Visteon	$	22	$	16
Denominator:
Average common stock outstanding - basic	28.0		27.9
Dilutive effect of performance based share units and other	0.4		0.5
Diluted shares	28.4		28.4
Basic and Diluted Per Share Data:



Basic earnings (loss) per share attributable to Visteon	$	0.79	$	0.57




Diluted earnings (loss) per share attributable to Visteon:	$	0.77	$	0.56

•Enhance Shareholder Returns While Maintaining a Strong Balance Sheet - ~~On January 10, 2017, the Company's board of directors authorized management~~The Company has returned approximately $3.3 billion to purchase $400 million of Visteon common stock. On February 27, 2017, the Company entered into an accelerated share buyback ("ASB") program with a third-party financial institution to purchase shares of Visteon common stock for an aggregate purchase price of $125 million. Through conclusion of the program on May 8, 2017, the Company acquired 1,300,366 shares at an average price of $96.13 per share.shareholders since 2015. In addition, ~~to the ASB program,~~ the Company has ~~purchased of 441,613 shares in the open market. Through the end of the third quarter, the Company has purchased 1,741,979 shares at an average price of $97.59 per share~~continued to maintain a strong balance sheet to withstand near-term industry volatility while providing a foundation for ~~a total of $170 million in share repurchases during 2017.~~future growth and shareholder returns.

Financial Results

The Company anticipates that additional share repurchases, if any, would occur from time to time in open market transactions or in privately negotiated transactions depending on market and economic conditions, share price, trading volume, alternative uses of capital and other factors.

~~Executive Summary~~

~~The Company's Electronics~~pie charts below highlight the net sales breakdown for Visteon for the three months ended ~~September 30, 2017 totaled $765 million, the pie charts below highlight the sales breakdown for the three and nine months ended September 30, 2017.~~

March 31, 2022.

Three Months Ended ~~September 30, 2017~~March 31, 2022

~~Nine~~*Regional net sales are based on the geographic region where sales originate and not where customer is located (excludes inter-regional eliminations).

Global Automotive Market Conditions and Production Levels

The automotive industry has been negatively impacted by the COVID-19 pandemic and the ongoing semiconductor shortage. In the first half of 2021, semiconductor supply was further impacted by a winter storm in Texas and a fire at the facility of a semiconductor supplier in Japan. In addition, COVID outbreaks in the middle of 2021 in Southeast Asia caused several back-end processing facilities that perform assembly and test of semiconductors to be negatively impacted. Industry vehicle volumes are expected to increase in 2022 due to strong consumer demand and historically low inventory levels at auto dealerships. However, vehicle production volumes will be negatively impacted due to on-going shortages of semiconductors, disruptions caused by the geopolitical situation in Eastern Europe, and the recent COVID-19 related lockdowns in China. The magnitude of the impact on the financial statements and results of operations and cash flows will depend on the evolution of the semiconductor supply shortage, plant production schedules, and supply chain impacts.

Results of Operations - Three Months Ended ~~September 30, 2017~~

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Third quarter 2017 global light vehicle production increased 2.1% over the same period last year. Production increased year over year in all regions during the third quarter except for North America which was down (9.7%) as manufacturers cut production to reduce higher than optimal levels of unsold inventory.

~~Light vehicle production levels for the three~~March 31, 2022 and ~~nine months ended September 30, 2017 and 2016, by geographic region are provided below:~~

Three Months Ended
September 30 Nine Months Ended
September 30
2017 2016 Change 2017 2016 Change
(Units in Millions)
Global 22.4
22.0
2.1 % 69.8
68.0
2.6 %
Asia Pacific 11.9
11.5
3.5 % 36.0
34.7
3.6 %
Europe 5.0
4.8
5.2 % 16.5
16.1
2.4 %
North America 4.0
4.4
(9.7 )% 13.0
13.5
(3.7 )%
South America 0.9
0.7
26.1 % 2.4
2.0
20.9 %
Other 0.6
0.6
11.6 % 1.9
1.7
12.9 %
Source: IHS Automotive

~~Significant aspects of the Company's financial results during the three and nine months periods ended September 30, 2017 include the following:~~

The Company recorded sales of $765 million for the three months ended September 30, 2017, representing a decrease of $5 million when compared with the same period of 2016. The decrease is attributable to the exit of other climate operations in 2016, representing a decrease of $21 million. Electronics sales increased by $16 million, primarily due to new business, favorable volumes, product mix, and currency, partially offset by customer pricing net of design changes.

The Company recorded sales of $2,349 million for the nine months ended September 30, 2017, representing an increase of $4 million when compared with the same period of 2016. The increase was primarily due to new business, favorable volumes, and product mix, partially offset by customer pricing net of design changes, unfavorable currency, and the exit of other climate operations in 2016.

Gross margin was $116 million or 15.2% of sales for the three months ended September 30, 2017, compared to $105 million or 13.6% of sales for the same period of 2016. The increase was primarily attributable to improved cost performance including higher engineering recoveries and favorable volumes and currency, partially offset by customer pricing and product mix.

Gross margin was $359 million or 15.3% of sales for the nine months ended September 30, 2017, compared to $335 million or 14.3% of sales for the same period of 2016. The increase was primarily attributable to the exit of the Company's other climate operations in 2016, favorable volumes, net new business and improved cost performance including higher engineering recoveries, partially offset by customer pricing, currency impacts, and product mix.

Net income attributable to Visteon was $43 million for the three months ended September 30, 2017, compared to net income of $28 million for the same period of 2016. The increase of $15 million includes improved gross margin of $11 million and the non-recurrence of charges associated with the 2016 South Africa climate disposition of $11 million. These increases were partially offset by an increase in the provision for income taxes of $3 million and the non-recurrence of 2016 discontinued operations net income of $7 million.

Net income attributable to Visteon was $151 million for the nine months ended September 30, 2017, compared to net income of $73 million for the same period of 2016. The increase of $78 million includes higher net income due to the non-recurrence of 2016 losses from discontinued operations of $15 million, 2017 income from discontinued operations of $8 million, lower restructuring charges of $12 million, the non-recurrence of charges associated with the 2016 South Africa climate disposition of $11 million, lower selling, general and administrative expenses of $5 million, higher equity in net income of non-consolidated affiliates of $3 million and gains on the sale of non-consolidated affiliates of $3 million. Gross margin improved $24 million including $17 million for electronics operations and $7 million related to the 2016 exit of the climate operations. These improvements were partially offset by higher income taxes of $7 million.

Including discontinued operations, the Company generated $131 million of cash in operating activities during the nine months ended September 30, 2017, compared to cash provided by operations of $38 million during the same period of 2016 representing a $93 million improvement. The increase in operating cash flows is attributable to higher net income of $77 million and lower cash tax payments, net of expense of $67 million primarily due to the non-recurrence of

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transaction related taxes incurred in 2016, partially offset by higher warranty payments net of expense of $21 million, higher working capital use of approximately $10 million and an increase in China bank notes of $11 million.

Total cash was $735 million, including $3 million of restricted cash as of September 30, 2017, $147 million lower than $882 million as of December 31, 2016, primarily attributable to share repurchases of $170 million, $69 million of capital expenditures, and the repurchase of the India electronics operations sold in connection with the Climate Transaction of $47 million, partially offset by the change in cash provided by operating activities of $93 million and $15 million proceeds from business divestiture.

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2021

The Company's consolidated results of operations for the three months ended ~~September 30, 2017~~March 31, 2022 and ~~2016~~2021 were as follows:


	Three Months Ended March 31,
(In millions)	2022		2021		Change
Net sales	$	818	$	746	$	72
Cost of sales	(742)		(673)		(69)
Gross margin	76		73		3
Selling, general and administrative expenses	(44)		(45)		1
Restructuring and impairment	(7)		1		(8)
Interest expense, net	(2)		(2)		—
Equity in net income of non-consolidated affiliates	3		—		3
Other income, net	5		4		1
Provision for income taxes	(8)		(12)		4


Net income (loss)	23		19		4
Less: Net (income) loss attributable to non-controlling interests	(1)		(3)		2
Net income (loss) attributable to Visteon Corporation	$	22	$	16	$	6
Adjusted EBITDA*	$	71	$	64	$	7
* Adjusted EBITDA is a Non-GAAP financial measure, as further discussed below.

Three Months Ended September 30
2017 2016 Change
(Dollars in Millions)
Sales $ 765
$ 770
$ (5 )
Cost of sales 649
665
(16 )
Gross margin 116
105
11
Selling, general and administrative expenses 54
53
1
Restructuring expense 6
5
1
Interest expense, net 3
5
(2 )
Equity in net income of non-consolidated affiliates 1
—
1
Other (income) expense, net (1 ) 12
(13 )
Provision for income taxes 8
5
3
Net income from continuing operations 47
25
22
Income from discontinued operations —
7
(7 )
Net income 47
32
15
Net income attributable to non-controlling interests 4
4
—
Net income attributable to Visteon Corporation $ 43
$ 28
$ 15
Adjusted EBITDA* $ 83
$ 75
$ 8

* Adjusted EBITDA is a Non-GAAP financial measure, as further discussed below.
Net Sales, Cost of Sales and Gross Margin


(In millions)	Net Sales		Cost of Sales		Gross Margin
Three months ended March 31, 2021	$	746	$	(673)	$	73
Volume, mix, and net new business	45		(33)		12
Currency	(12)		9		(3)
Customer pricing	41		—		41
Engineering costs, net *	—		10		10
Cost performance, design changes and other	(2)		(55)		(57)
Three months ended March 31, 2022	$	818	$	(742)	$	76
*Excludes the impact of currency.

~~Results of Operations - Three Months Ended September 30, 2017 and 2016~~

~~Prior to 2017, the Company also had Other operations consisting primarily of the South Africa and the South America climate operations exited during the fourth quarter of 2016.~~

~~Sales~~

Electronics Other Total
(Dollars in Millions)
Three months ended September 30, 2016 $ 749
$ 21
$ 770
Volume, mix, and net new business 26
—
26
Currency 9
—
9
Customer pricing and other (19 ) —
(19 )
Exit and wind-down —
(21 ) (21 )
Three months ended September 30, 2017 $ 765
$ —
$ 765

~~Sales~~Net sales for the three months ended ~~September 30, 2017~~March 31, 2022 totaled ~~$765~~$818 million, ~~which represents~~representing an ~~decrease~~increase of $5$72 million compared with the same period of ~~2016.~~2021. Volumes and net new business increased net sales by $45 million. Unfavorable currency decreased net sales by $12 million, primarily attributable to the Euro and Japanese Yen. Favorable ~~volumes, product~~customer pricing increased net sales by $41 million primarily driven by customer recoveries related to supply chain and material cost increases associated with the worldwide semiconductor supply shortage.

Cost of sales increased by $69 million for the three months ended March 31, 2022 compared with the same period in 2021. Volume, mix and net new business increased cost of sales by ~~$26~~$33 million. ~~Product mix reflects the Company specific content across product lines. Favorable~~Foreign currency ~~increased~~decreased cost of sales by $9 million, primarily attributable to the Euro and ~~Indian Rupee. The exit~~Japanese Yen. Net engineering costs, excluding currency, decreased cost of ~~other climate operations in 2016 decreased~~ sales by ~~$21~~$10 million. ~~Other reductions were associated with customer pricing, net of~~Unfavorable cost performance, design ~~savings.~~

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~~Cost of Sales~~

Electronics Other Total
(Dollars in Millions)
Three months ended September 30, 2016 $ 644
$ 21
$ 665
Currency 7
—
7
Volume, mix, and net new business 30
—
30
Exit and wind-down —
(21 ) (21 )
Net cost performance (32 ) —
(32 )
Three months ended September 30, 2017 $ 649
$ —
$ 649

~~Cost of sales decreased $16 million for the three months ended September 30, 2017 when compared with the same period in 2016. Increased volumes, product mix,~~changes and ~~net new business~~other increased cost of sales by ~~$30 million. Foreign currency increased cost of sales by $7~~$55 million primarily ~~attributable to~~due supply chain and material cost impacts associated with the ~~Euro and Brazilian Real. The exit and wind down~~worldwide semiconductor supply shortage.

A summary of other climate operations decreased costs by $21 million. Net efficiencies, including material, design and usage economics and higher engineering recoveries, partially offset by increased manufacturing expense, decreased cost of sales by $29 million. Cost of sales also included a $3 million benefit related to legacy South America climate operations for freight recoveries and a favorable ruling on a litigation matter.

~~Cost of sales includes~~ net engineering costs ~~comprised of gross~~is shown below:


	Three Months Ended March 31,
(In millions)	2022		2021
Gross engineering costs	$	(81)	$	(80)
Engineering recoveries	33		21
Engineering costs, net	$	(48)	$	(59)

Gross engineering ~~expenses related~~costs relate to forward model program development and advanced engineering activities ~~partially offset by~~and exclude contractually reimbursable engineering ~~cost recoveries from customers. Electronics gross~~costs. Net engineering ~~expenses were $99~~costs of $48 million for the three months ended ~~September 30, 2017, consistent with~~March 31, 2022, including the ~~same period~~impacts of ~~2016. Engineering recoveries~~currency, were ~~$33~~$11 million ~~for the three months ended September 30, 2017, $9 million higher~~lower than the same period of ~~2016. Engineering cost recoveries can fluctuate period~~2021. This decrease is primarily related to ~~period depending on underlying contractual terms and conditions and achievement of related development milestones.~~

~~Gross Margin~~

Gross margin was $116 million or 15.2% of sales for the three months ended September 30, 2017 compared to $105 million or 13.6% of sales for the same period of 2016. The increase in gross margin of $10 million included $9 million of favorable net cost performance reflecting material cost efficiencies and higherincreased engineering recoveries ~~which more than offset customer pricing and higher manufacturing costs. Favorable currency of $2 million reflected~~during the impact of the Indian Rupee and Brazilian Real. Favorable volumes and net new business were offset by product mix reducing gross margin by $4 million. The year-over-year change in gross margin also included a $3 million benefit related to legacy South America climate operations for freight recoveries and a favorable ruling on a litigation matter.

first quarter 2022.

Selling, General and Administrative Expenses

Selling, general, and administrative expenses were ~~$54~~$44 million ~~or 7.1%~~ and ~~$53~~$45 million, ~~or 6.9%~~ during the three months ended ~~September 30, 2017~~March 31, 2022 and ~~2016,~~2021, respectively. ~~The increase is~~

Restructuring and impairment

Due to the current geopolitical situation in Eastern Europe the Company will indefinitely suspend operations in Russia beginning in the second quarter 2022. As such, the Company recorded $1 million of restructuring expense primarily related to ~~higher incentive compensation costs and economics partially offset by cost efficiencies.~~employee severance.

~~Restructuring Expense~~

During the ~~fourth~~first quarter 2022 the Company approved and recorded $1 million of restructuring expense, primarily impacting Europe, in order to improve efficiencies and rationalize the Company's footprint.

During the first quarter of ~~2016,~~2022 the Company ~~announced~~recorded $1 million of additional expense related to a restructuring program ~~impacting the engineering~~in Brazil in order to improve efficiencies and ~~administrative functions to further align~~rationalize the Company's engineering and related administrative footprint with its core product technologies and customers. During the three months ended September 30, 2017, the Company recorded $6 million of restructuring expenses, net of reversals, under this program. Through September 30, 2017, the Company recorded approximately $37 million of restructuring expenses under this program, and expects to incur up to $45 million of restructuring costs associated with approximately 250 employees.footprint.

During the three months ended September 30, 2016, the Company recorded $4 million of restructuring expenses primarily related to severance and termination benefits, in connection with the wind-down of certain operations in South America.

~~Table of Contents~~

Interest Expense, Net

Interest expense, net, ~~was $3 million and $5 million~~ for the three months ended ~~September 30, 2017~~March 31, 2022 and ~~2016, respectively.~~2021 was $2 million. Interest expense for these periods is primarily related to the ~~three months ended September 30, 2017 includes termination impacts of~~borrowings on the Company's ~~interest rate swap as further described in Note 16, "Fair Value Measurements and Financial Instruments."~~

term debt facility.

Equity in Net Income of Non-Consolidated Affiliates

Equity in net income of non-consolidated affiliates was $3 million and less than $1 million for the three ~~month period ending September 30, 2017.~~months ended March 31, 2022 and 2021, respectively. The increase in income is primarily attributable due to increased volumes at the Company's non-consolidated affiliates.

Other ~~(Income) Expense,~~Income, Net

Other ~~(income) expense,~~income, net ~~consists~~ of $5 million and $4 million for the ~~following:~~three-month periods ending March 31, 2022 and 2021 is primarily due to net pension financing benefits.

Three Months Ended
September 30
2017 2016
(Dollars in Millions)
Transformation initiatives $ 1
$ —
Gain on non-consolidated affiliate transactions, net (2 ) (1 )
Foreign currency translation charge —
11
Loss on asset contribution —
2
$ (1 ) $ 12

Transformation initiative costs include information technology separation costs, integration of acquired business, and financial and advisory services incurred in connection with the Company's transformation into a pure play cockpit electronics business. The gain on non-consolidated affiliate transactions, net are described in Note 5, "Non-Consolidated Affiliates."

The Company recorded an impairment charge of $11 million during the three months ended September 30, 2016, related to foreign currency translation amounts recorded in accumulated other comprehensive loss associated with the agreement to sell the Company's South Africa climate operations. In connection with the closure of the Climate facility in Argentina, the Company entered an agreement to contribute land and building with a net book value of $2 million to the local municipality.

Income Taxes

The Company's provision for income taxes of $8 million for the three months ended ~~September 30, 2017,~~March 31, 2022 represents ~~an increase~~a decrease of $3$4 million ~~when~~ compared with $5$12 million in the same period of ~~2016.~~2021. The ~~increase~~decrease in tax expense is ~~primarily~~ attributable to several items including the ~~year-over-year~~non-recurrence of $2 million provision for income taxes related to uncertain tax positions attributable to certain related party transactions and the non-recurrence of $1 million related to enacted tax law changes in India, as well as the overall year over year decrease in profit before tax excluding equity income, including changes in the mix of earnings and differing tax rates between jurisdictions. In this regard, during the three months ended September 30, 2016, the Company reflected favorable adjustments due to incorporating certain transfer pricing adjustments between the U.S. and Japan consistent with the anticipated transfer pricing methodology expected to be agreed upon in connection with the pursuit of a bilateral advance pricing agreement (“APA”) with the U.S. and Japan tax authorities.

~~Discontinued Operations~~

~~Net Income~~

~~Table of Contents~~

Adjusted EBITDA

Adjusted EBITDA (a non-GAAP financial measure, as defined in Note ~~18)~~15, "Segment Information") was ~~$83~~$71 million for the three months ended ~~September 30, 2017,~~March 31, 2022, representing an increase of $8$7 million when compared ~~with Adjusted EBITDA of $75~~to $64 million for the same period of ~~2016.~~2021. The ~~increase includes favorable net cost performance~~change was driven by higher volumes of $10 million reflecting material cost efficiencies and higher engineering recoveries which more than offset customer pricing and higher manufacturing costs. Foreign currency increased Adjusted EBITDA by $2 million attributable to the Brazilian Real and Indian Rupee. Favorable volumes and net new business were offset by product mix, reducing adjusted EBITDA by $4 million.

~~The reconciliation of Adjusted EBITDA to net income attributable to Visteon for the three months ended September 30, 2017 and 2016, is as follows:~~

Three Months Ended September 30
2017 2016 Change
(Dollars in Millions)
Adjusted EBITDA $ 83
$ 75
$ 8
  Depreciation and amortization 21
21
—
  Restructuring expense 6
5
1
  Interest expense, net 3
5
(2 )
  Equity income of non-consolidated affiliates (1 ) —
(1 )
  Other (income) expense, net (1 ) 12
(13 )
  Provision for income taxes 8
5
3
  Income from discontinued operations, net of tax —
(7 ) 7
  Net income attributable to non-controlling interests 4
4
—
  Non-cash, stock-based compensation 3
2
1
  Other (3 ) —
(3 )
Net income attributable to Visteon Corporation $ 43
$ 28
$ 15

~~The Company's consolidated results of operations for the nine months ended September 30, 2017 and 2016 were as follows:~~

Nine Months Ended September 30
2017 2016 Change
(Dollars in Millions)
Sales $ 2,349
$ 2,345
$ 4
Cost of sales 1,990
2,010
(20 )
Gross margin 359
335
24
Selling, general and administrative expenses 158
163
(5 )
Restructuring expense 10
22
(12 )
Interest expense, net 12
10
2
Equity in net income of non-consolidated affiliates 6
3
3
Other (income) expense, net (3 ) 16
(19 )
Provision for income taxes 34
27
7
Net income from continuing operations 154
100
54
Income (loss) from discontinued operations 8
(15 ) 23
Net income 162
85
77
Net income attributable to non-controlling interests 11
12
(1 )
Net income attributable to Visteon Corporation $ 151
$ 73
$ 78
Adjusted EBITDA* $ 268
$ 241
$ 27

* Adjusted EBITDA is a Non-GAAP financial measure, as further discussed below.

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~~Results of Operations - Nine Months Ended September 30, 2017 and 2016~~

~~Prior to 2017, the Company also had Other operations consisting of the South Africa and the South America climate operations exited during the fourth quarter of 2016.~~

~~Sales~~

Electronics Other Total
(Dollars in Millions)
Nine months ended September 30, 2016 $ 2,304
$ 41
$ 2,345
Volume, mix, and net new business 117
—
117
Currency (14 ) —
(14 )
Customer pricing and other (58 ) —
(58 )
Exit and wind-down —
(41 ) (41 )
Nine months ended September 30, 2017 $ 2,349
$ —
$ 2,349

Sales for the nine months ended September 30, 2017 totaled $2,349 million, which represents an increase of $4 million compared with the same period of 2016. Favorable volumes, product mix, and net new business increased sales by $117 million. Product mix reflects the Company specific content across product lines. Unfavorable currency decreased sales by $14 million, primarily attributable to the Chinese Renminbi and Euro partially offset by the Brazilian Real and Indian Rupee. The exit of other climate operations in 2016 decreased sales by $41 million. Other reductions were associated with customer pricing, net of design savings.

~~Cost of Sales~~

Electronics Other Total
(Dollars in Millions)
Nine months ended September 30, 2016 $ 1,962
$ 48
$ 2,010
Currency (12 ) —
(12 )
Volume, mix, and net new business 112
—
112
Exit and wind-down —
(48 ) (48 )
Net cost performance (72 ) —
(72 )
Nine months ended September 30, 2017 $ 1,990
$ —
$ 1,990

Cost of sales decreased $20 million for the nine months ended September 30, 2017 when compared with the same period in 2016. Increased volumes, product mix, and net new business increased cost of sales by $112 million. Foreign currency decreased cost of sales by $12 million primarily attributable to the Chinese Renminbi, Japanese Yen, and Mexican Peso, partially offset by the Euro, Brazilian Real, and Thai Bhat. The exit and wind down of other climate operations decreased cost of sales by $48 million. Net efficiencies, including material, design and usage economics, and higher engineering recoveries, partially offset by ~~higher manufacturing and warranty~~increased costs decreased cost of sales by $68 million. Cost of sales during the nine months ended September 30, 2017 also includes a $4 million benefit related to legacy South America climate operations for freight recoveries and a favorable litigation matter ruling.

Cost of sales includes net engineering costs, comprised of gross engineering expenses related to forward model program development and advanced engineering activities, partially offset by engineering cost recoveries from customers. Electronics gross engineering expenses were $288 million for the nine months ended September 30, 2017, a decrease of $3 million compared to the same period of 2016. Engineering recoveries were $79 million for the nine months ended September 30, 2017, $19 million higher than the recoveries recorded in the same period of 2016. Engineering cost recoveries can fluctuate period to period depending on underlying contractual terms and conditions and achievement of related development milestones.

~~Gross Margin~~

Gross margin was $359 million or 15.3% of sales for the nine months ended September 30, 2017 compared to $335 million or 14.3% of sales for the same period of 2016. The $24 million increase in gross margin included $5 million from favorable volumes and net new business, partially offset by product mix and $7 million related to the exit of climate operations. Currency decreased gross margin by $2 million as the impact of the Chinese Renminbi and Euro more than offset the impact of the Japanese Yen, Mexican Peso, and Brazilian Real. Gross margin also included net cost efficiencies of $10 million, including favorable material

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cost efficiencies and higher engineering recoveries partially offset by customer pricing reductions, and higher manufacturing costs. The year-over-year change in gross margin also included a $4 million benefit related to legacy South America climate operations.

~~Selling, General and Administrative Expenses~~

Selling, general, and administrative expenses were $158 million or 6.7% of sales and $163 million or 7.0% of sales during the nine months ended September 30, 2017 and 2016, respectively. The decrease is primarily related to net efficiencies including lower bad debt expense and impacts of restructuring actions.

~~Restructuring Expense~~

During the fourth quarter of 2016, the Company announced a restructuring program impacting engineering and administrative functions to further align the Company's engineering and related administrative footprint with its core product technologies and customers. Through September 30, 2017, the Company has recorded approximately $37 million of restructuring expenses, net of reversals, under this program, associated with approximately 250 employees, and expects to incur up to $45 million of restructuring costs for this program. During the nine months ended September 30, 2017, the Company has recorded approximately $10 million of restructuring expenses, net of reversals, under this program.

During the first quarter of 2016, the Company announced a restructuring program to transform the Company's engineering organization and supporting functional areas to focus on execution and technology. The organization will be comprised of regional engineering, product management and advanced technologies, and global centers of competence. Through the first nine months of 2016, the Company recorded approximately $13 million of restructuring expenses, net of reversals, under this program, associated with approximately 100 employees.

During the nine months ended September 30, 2016, the Company recorded $11 million of restructuring expenses, related to severance and termination benefits, in connection with the wind-down of certain operations in South America.

~~Interest Expense, Net~~

~~Interest expense, net was $12 million and $10 million for the nine months ended September 30, 2017 and 2016, respectively. The increase in net interest expense results from lower interest income~~ due to ~~lower cash balances, financing fees for the Amended Credit Facilities as further described in Note 11, "Debt"~~supply chain and ~~termination~~material cost impacts ~~of the Company's interest rate swap as further described in Note 16, "Fair Value Measurements and Financial Instruments."~~

~~Equity in Net Income of Non-Consolidated Affiliates~~

Equity in net income of non-consolidated affiliates was $6 million and $3 million for the nine month periods ended September 30, 2017 and 2016 respectively. The income is primarily attributable to the Company's equity interest in Yanfeng Visteon Investment Company and increased primarily related to the timing of engineering recoveries.

~~Other (Income) Expense, Net~~

~~Other (income) expense, net consists of the following:~~

Nine Months Ended
September 30
2017 2016
(Dollars in Millions)
Transformation initiatives $ 1
$ 3
Gain on non-consolidated affiliate transactions, net (4 ) (1 )
Foreign currency translation charge —
11
Loss on asset contribution —
2
Transaction exchange losses

—
1
$ (3 ) $ 16

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During the nine months ended September 30, 2016, the Company recorded an impairment charge of $11 million related to foreign currency translation amounts recorded in accumulated other comprehensive loss associated with the agreement to sell the Company's South Africa climate operations. In connection with the closure of the Climate facility in Argentina, the Company entered an agreement to contribute land and building with a net book value of $2 million to the local municipality.worldwide semiconductor supply shortage.

~~Income Taxes~~

The Company's provision for income taxes of $34 million for the nine months ended September 30, 2017 represents an increase of $7 million when compared with $27 million in the same period of 2016. The increase in tax expense is attributable to several items including the year-over-year increase in earnings, as well as changes in the mix of earnings and differing tax rates between jurisdictions, withholding taxes, the non-recurrence of a $3 million discrete income tax benefit in connection with certain income tax incentives formally approved by the Portuguese tax authorities during the first quarter of 2016, and $2 million resulting from changes in assessments regarding the potential realization of deferred tax assets. These increases were partially offset by the year-over-year decrease for uncertain tax positions, including interest, of approximately $3 million.

~~Discontinued Operations~~

The operations subject to the Interiors Divestiture and Climate Transaction met conditions required to qualify for discontinued operations reporting. Accordingly, the results of operations for the Interiors and Climate businesses have been reclassified to income (loss) from discontinued operations, net of tax in the consolidated statements of comprehensive income for the nine month periods ended September 30, 2017 and 2016. The nine months ending September 30, 2017 included a $7 million gain on the repurchase of the India electronics operations associated with the 2015 Climate Transaction. The nine months ending September 30, 2016 primarily included results of the South America interiors operations divested on December 1, 2016 and a tax benefit related to previously divested climate operations.

~~Net Income~~

Net income attributable to Visteon was $151 million for the nine months ended September 30, 2017, compared to net income of $73 million for the same period of 2016. The increase of $78 million includes discontinued operations impacts of $23 million, lower restructuring charges of $12 million, the non-recurrence of charges associated with the 2016 South Africa climate disposition of $11 million, lower selling, general and administrative expenses of $5 million, higher equity in net income of non-consolidated affiliates of $3 million and gains on the sale of non-consolidated affiliates of $3 million. Gross margin improved $24 million including $17 million for electronics operations and $7 million related to the 2016 exit of the climate operations. These improvements were partially offset by higher income taxes of $7 million.

~~Adjusted EBITDA~~

Adjusted EBITDA (a non-GAAP financial measure, as defined in Note 18) was $268 million for the nine months ended September 30, 2017, representing an increase of $27 million when compared with Adjusted EBITDA of $241 million for the same period of 2016. The increase includes $5 million from favorable volumes and net new business partially offset by product mix and $7 million related to other climate operations exited in 2016 . Foreign currency decreased Adjusted EBITDA by $1 million attributable to the Chinese Renminbi and Euro partially offset by the Japanese Yen, Mexican Peso, and Brazilian Real. Net cost performance of $16 million includes material cost efficiencies, higher engineering recoveries, and lower selling, general and administrative costs, offset by unfavorable customer pricing reductions, higher manufacturing costs, and increased warranty costs.

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The reconciliation of ~~Adjusted EBITDA to~~ net income (loss) attributable to Visteon to Adjusted EBITDA for the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2022 and ~~2016,~~2021, is as follows:


	Three Months Ended March 31,
(In millions)	2022		2021		Change
Net income (loss) attributable to Visteon Corporation	$	22	$	16	$	6
Depreciation and amortization	27		27		—
Provision for income taxes	8		12		(4)
Non-cash, stock-based compensation expense	5		4		1
Interest expense, net	2		2		—
Net income (loss) attributable to non-controlling interests	1		3		(2)
Restructuring and impairment expense	7		(1)		8

Equity in net income of non-consolidated affiliates	(3)		—		(3)
Other	2		1		1
Adjusted EBITDA	$	71	$	64	$	7

Nine Months Ended September 30
2017 2016 Change
(Dollars in Millions)
Adjusted EBITDA $ 268
$ 241
$ 27
  Depreciation and amortization 62
62
—
  Restructuring expense 10
22
(12 )
  Interest expense, net 12
10
2
  Equity in net income of non-consolidated affiliates (6 ) (3 ) (3 )
  Other (income) expense, net (3 ) 16
(19 )
  Provision for income taxes 34
27
7
  (Income) loss from discontinued operations, net of tax (8 ) 15
(23 )
  Net income attributable to non-controlling interests 11
12
(1 )
  Non-cash, stock-based compensation expense 9
6
3
  Other (4 ) 1
(5 )
Net income attributable to Visteon Corporation $ 151
$ 73
$ 78

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Liquidity

The Company's primary sources of liquidity are cash flows from operations, existing cash balances, and borrowings under available credit ~~facilities, if necessary. The~~facilities. As we continue to evaluate ongoing impacts of the COVID-19 pandemic including the semiconductor supply shortage and other supply chain impacts, the Company believes ~~that~~ funds generated from these sources will ~~be adequate~~continue to ~~fund~~sufficiently sustain ongoing operations and support investment in differentiating technologies. The Company will continue to closely monitor its available liquidity ~~for current business~~and maintain access to additional liquidity to weather these challenging conditions. The Company's intra-year needs are normally impacted by seasonal effects in the industry, such as mid-year shutdowns, the ramp-up of new model production, and year-end shutdowns at key customers. The ongoing COVID-19 pandemic and related semiconductor supply shortage may exacerbate the intra-year requirements.

A substantial portion of the Company's cash flows from operations are generated by operations located outside of the ~~U.S.~~United States. Accordingly, the Company utilizes a combination of cash repatriation strategies, including dividends and distributions, royalties, ~~intercompany loan arrangements~~ and other ~~distributions and advances~~intercompany arrangements to provide the funds necessary to meet obligations globally. The Company’s ability to access funds from its subsidiaries is subject to, among other things, customary regulatory and statutory requirements and contractual arrangements including joint venture agreements and local credit facilities. Moreover, repatriation efforts may be modified by the Company according to prevailing circumstances.

The Company's ability to generate operating cash flow is dependent on the level, variability and timing of its customers' worldwide vehicle production, which may be affected by many factors including, but not limited to, general economic conditions, specific industry conditions, financial markets, competitive factors and legislative and regulatory changes. The Company monitors the macroeconomic environment and its impact on vehicle production volumes in relation to the Company's specific cash needs. The Company's intra-year needs are impacted by seasonal effects in the industry, such as mid-year shutdowns, the subsequent ramp-up of new model production and year-end shutdowns at key customers.

In the event that the Company's funding requirements exceed cash provided by its operating activities, the Company will meet such requirements by reduction of existing cash balances, by drawing on its $300 million Revolving Credit Facility or other affiliate working capital lines, by seeking additional capital through debt or equity markets, or some combination thereof.

Access to additional capital through the debt or equity markets is influenced by the Company's credit ratings. OnAs of March ~~7, 2017,~~31, 2022, the Company’s corporate credit rating is Ba3 and BB- by Moody’s and Standard & ~~Poor's Ratings Services upgraded the Company to 'BB', from 'BB-', with stable outlook. Moody's has reaffirmed the Company's credit rating of Ba3.~~Poor’s, respectively. See Note 118, "Debt" ~~to the accompanying consolidated financial statements~~ for a ~~more~~ comprehensive discussion of the Company's debt facilities. Incremental funding requirements of the Company's consolidated foreign entities are primarily accommodated by intercompany cash pooling structures. Affiliate working capital lines, ~~are primarily used~~which may be utilized by the Company's local subsidiaries and consolidated joint ~~ventures. As of September 30, 2017, these lines~~ventures, had availability of ~~approximately $18 million.~~$150 million and the Company had $400 million of available credit under the revolving credit facility, as of March 31, 2022. As of March 31, 2022, the Company was in compliance with all its debt covenants.

Cash Balances

As of ~~September 30, 2017,~~March 31, 2022, the Company had total cash and cash equivalents of ~~$735~~$405 million, including $3 million of restricted cash. Cash balances totaling ~~$467~~$339 million were located in jurisdictions outside of the United States, of which approximately ~~$195~~$115 million is considered permanently reinvested for funding ongoing operations outside of the U.S. If such permanently reinvested funds ~~are~~were repatriated to ~~operations in~~ the U.S., no U.S. federal taxes would be imposed on the distribution of such foreign earnings due to U.S. tax reform enacted in December 2017. However, the Company would be required to accrue additional tax expense, primarily related to foreign withholding taxes.

Other Items Affecting Liquidity

During 2017, the Company expects to make remaining payments of approximately $35 million related to the Germany interiors divestiture that closed on December 1, 2015. Also, as announced during the fourth quarter of 2016, the Company expects to incur restructuring costs to further align the Company's engineering and related administrative footprint with its core product technologies and customers. The Company estimates that it may incur up to $45 million in cumulative expenses to complete these actions of which $37 million has been expensed and $14 million has been paid since inception to date through September 30, 2017.

The Company is actively negotiating the possible exit of a European facility that may involve contributing cash working capital to the purchaser. The estimated contribution includes cash and working capital ranging from $15 million to $20 million .

~~Management continually seeks to streamline the Company's operations and may incur additional restructuring charges in the future.~~

The Company is authorized to spend an additional $230 million to repurchase Visteon common stock pursuant to the $400 million share repurchase authorization, as discussed in Note 14, "Stockholders' Equity and Non-Controlling Interests" of the consolidated financial statements under Item 1.

During the ~~nine~~three months ended ~~September 30, 2017,~~March 31, 2022, cash contributions to the Company's ~~U.S. and~~defined benefit plans were $1 million related to its non-U.S. plans. The Company estimates that total cash contributions to its non-U.S. defined benefit pension ~~plan were~~plans during 2022 will be $4 million.

During the three months ended March 31, 2022, the Company paid $5 ~~million.~~million related to restructuring activities. Additional discussion regarding the Company's restructuring activities is included in Note 3, "Restructuring Activities." The Company ~~expects~~estimates that total cash restructuring payments during the next twelve months will be approximately $14 million.

The Company committed to make a $15 million investment in two funds managed by venture capital firms principally focused on the automotive sector pursuant to limited partnership agreements. As of March 31, 2022, the Company contributed $10 million toward the aggregate investment commitments. As a limited partner in each entity, the Company will periodically make capital contributions toward this total commitment amount.

The Company may be required to make significant cash ~~contributions~~outlays related to its ~~defined benefit pension plans~~unrecognized tax benefits, including interest and penalties. As of ~~$7 million~~March 31, 2022, the Company had unrecognized tax benefits, including interest and penalties, that would be expected to result in ~~2017.~~a cash outlay of $8 million. Given the number of years, jurisdictions and positions subject to examination, the Company is unable to estimate the period of cash settlement, if any, with the respective taxing authorities.

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~~Estimated cash contributions for 2018 through 2020, under current regulations and market assumptions are approximately $29 million.~~

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Cash Flows

Operating Activities

~~Including discontinued operations, the~~The Company ~~generated $131~~used $21 million of cash infrom operating activities during the ~~nine~~three months ended ~~September 30, 2017,~~March 31, 2022 representing increased usage of 32 million as compared to prior year. The decrease in cash ~~provided by~~from operations is primarily attributable to increased working capital outflows. Increased working capital outflows of ~~$38~~$29 million ~~during~~as compared to prior year were primarily attributed to higher inventory levels resulting from the ~~same period of 2016, representing a $93 million improvement. The~~uneven supply chain environment, an increase in ~~operating cash flows is attributable to~~safety stock levels and higher ~~net income of $77 million and lower cash tax payments, net of expense of $67 million primarily due to the non-recurrence of transaction related taxes incurred in 2016,~~raw material prices. These increases were partially offset by ~~higher working capital use of approximately $10 million, higher warranty payments net of expense of $21 million and~~ an increase in ~~China bank notes of $11 million.~~ Adjusted EBITDA (a non-GAAP financial measure, as discussed in Note 15, "Segment Information").

Investing Activities

Cash used from investing activities during the nine months ended September 30, 2017 totaled $97 million, compared to net cash provided by investing activities of $339 million for the same period in 2016, representing a decrease of $436 million. Net cash used by investing activities during the ~~nine~~three months ended ~~September 30, 2017, includes the purchase of the India electronics operations associated with the Climate Transaction for $47~~March 31, 2022 totaled $21 million, ~~and capital expenditures of $69 million. These outflows were partially offset by proceeds for divestitures of equity and cost based investments in China and Europe of~~representing a $6 million increase as compared to $15 million ~~and net investment hedge settlement proceeds~~use of ~~$5 million.~~

~~Net~~ cash ~~flow provided~~from investing activities during the same period in 2021. Higher cash used by investing activities ~~for~~is primarily attributable to a $3 million increase in capital expenditures during the ~~nine~~three months ended ~~September 30, 2016 includes~~March 31, 2022 as compared to the ~~Climate Transaction withholding tax refund~~same period in 2021 and the non-recurrence of ~~$356~~loan repayments received from non-consolidated affiliates of $2 million ~~liquidation of investments of short-term securities of $47 million and proceeds from asset sales of $15 million, partially offset by capital expenditures of $56 million,~~during the ~~acquisition of AllGo Embedded Systems Private Limited of $15 million and an $8 million shareholder loan to a non-consolidated affiliate.~~

three months ended March 31, 2021.

Financing Activities

Cash used by financing activities during the ~~nine~~three months ended September 30, 2017, totaled $197 million, compared to $2,260 million used by financing activities for the same period in 2016, for a decrease in cash used by financing activities of $2,063 million. Cash used by financing activities during the nine months ended September 30, 2017 included share repurchases of $170March 31, 2022 was $4 million and ~~dividends paid~~is attributable to ~~non-controlling interests of $29 million.~~

~~Cash used by financing activities during~~ the ~~nine months ended September 30, 2016 of $2,260 million included a distribution~~ payment of ~~$1,736 million, share repurchases of $500 million, stock based compensation tax withholding payments of $11 million and net payments on debt of $13 million.~~subsidiary borrowings.

Debt and Capital Structure

See Note ~~11,~~8, “Debt” to the condensed consolidated financial statements included in Item 1.

~~Off-Balance Sheet Arrangements~~Significant Accounting Policies and Critical Accounting Estimates

See Note 1, “Summary of Significant Accounting Policies” to the accompanying condensed consolidated financial statements in Item 1.

The Company does not have any off-balance sheet financial arrangements that have or are reasonably likely to have a material current or future effect on financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Fair Value ~~Measurement~~

Measurements

See Note ~~16,~~13, “Fair Value Measurements and Financial Instruments” to the condensed consolidated financial statements included in Item 1.

Recent Accounting Pronouncements

See Note 21, “Summary of Significant Accounting Policies” to the accompanying condensed consolidated financial statements in Item 1.

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Forward-Looking Statements

Certain statements contained or incorporated in this Quarterly Report on Form 10-Q which are not statements of historical fact constitute “Forward-Looking Statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Reform Act”). Forward-looking statements give current expectations or forecasts of future events. Words such as “anticipate”, “expect”, “intend”, “plan”, “believe”, “seek”, “estimate” and other words and terms of similar meaning in connection with discussions of future operating or financial performance signify forward-looking statements. These statements reflect the Company’s current views with respect to future events and are based on assumptions and estimates, which are subject to risks and ~~uncertainties including those discussed in Item 1A under the heading “Risk Factors” and elsewhere in this report.~~uncertainties. Accordingly, undue reliance should not be placed on these forward-looking statements. Also, these forward-looking statements represent the Company’s estimates and assumptions only as of the date of this report. The Company does not intend to update any of these forward-looking statements to reflect circumstances or events that occur after the statement is made and qualifies all of its forward-looking statements by these cautionary statements.

You should understand that various factors, in addition to those discussed elsewhere in this document, could affect the Company’s future results and could cause results to differ materially from those expressed in such forward-looking statements, including:

•Significant or prolonged shortage of critical components from Visteon’s suppliers including, but not limited to semiconductors and those components from suppliers who are sole or primary sources.

•Continued and future impacts related to the conflict between Russia and the Ukraine including supply chain disruptions, reduction in customer demand, and the imposition of sanctions on Russia.

•Continued and future impacts of the coronavirus ("COVID-19") pandemic on the Visteon’s financial condition and business operations including global supply chain disruptions, market downturns, reduced consumer demand, and new government actions or restrictions.

•Significant changes in the competitive environment in the major markets where Visteon procures materials, components, or supplies or where its products are manufactured, distributed, or sold.

•Visteon’s ability to satisfy its future capital and liquidity requirements; Visteon’s ability to access the credit and capital markets at the times and in the amounts needed and on terms acceptable to Visteon; Visteon’s ability to comply with covenants applicable to it; and the continuation of acceptable supplier payment terms.

Visteon’s ability to satisfy its pension and other postretirement employee benefit obligations, and to retire outstanding debt and satisfy other contractual commitments, all at the levels and times planned by management.

•Visteon’s ability to access funds generated by its foreign subsidiaries and joint ventures on a timely and ~~cost effective~~cost-effective basis.

•Changes in the operations (including products, product planning and part sourcing), financial condition, results of operations, or market share of Visteon’s customers.

•Changes in vehicle production volume of Visteon’s customers in the markets where it ~~operates, and in particular changes in Ford’s vehicle production volumes and platform mix.~~operates.

•Increases in ~~our vendor's~~ commodity costs or disruptions in the supply of commodities, including ~~aluminum,~~resins, copper, fuel, and natural gas.

•Visteon’s ability to generate cost savings to offset or exceed ~~agreed upon~~agreed-upon price reductions or price reductions to win additional business and, in general, improve its operating performance; to achieve the benefits of its restructuring actions; and to recover engineering and tooling costs and capital investments.

•Visteon’s ability to compete favorably with automotive parts suppliers with lower cost structures and greater ability to rationalize operations; and to exit non-performing businesses on satisfactory terms, particularly due to limited flexibility under existing labor agreements.

•Restrictions in labor contracts with unions that restrict Visteon’s ability to close plants, divest unprofitable, noncompetitive businesses, change local work rules and practices at a number of facilities and implement cost-saving measures.

•The costs and timing of facility closures or dispositions, business or product realignments, or similar restructuring actions, including potential asset impairment or other charges related to the implementation of these actions or other adverse industry conditions and contingent liabilities.

~~Significant changes in the competitive environment in the major markets where Visteon procures materials, components or supplies or where its products are manufactured, distributed or sold.~~

•Legal and administrative proceedings, investigations and claims, including shareholder class actions, inquiries by regulatory agencies, product liability, warranty, employee-related, environmental and safety claims and any recalls of products manufactured or sold by Visteon.

•Changes in economic conditions, currency exchange rates, changes in foreign laws, regulations or trade policies or political stability in foreign countries where Visteon procures materials, components or supplies or where its products are manufactured, distributed, or sold.

•Shortages of materials or interruptions in transportation systems, labor strikes, work stoppages or other interruptions to or difficulties in the employment of labor in the major markets where Visteon purchases materials, components or supplies to manufacture its products or where its products are manufactured, distributed or sold.

•Visteon’s ability to satisfy its pension and other postretirement employee benefit obligations, and to retire outstanding debt and satisfy other contractual commitments, all at the levels and times planned by management.

•Changes in laws, regulations, policies or other activities of governments, agencies and similar organizations, domestic and foreign, that may tax or otherwise increase the cost of, or otherwise affect, the manufacture, licensing, distribution, sale, ownership, or use of Visteon’s products or assets.

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•Possible terrorist attacks or acts of war, which could exacerbate other risks such as slowed vehicle production, interruptions in the transportation system, orchanges in fuel prices, and disruptions of supply.

•The cyclical and seasonal nature of the automotive industry.

•Visteon’s ability to comply with environmental, safety, and other regulations applicable to it and any increase in the requirements, responsibilities and associated expenses and expenditures of these regulations.

•Visteon’s ability to protect its intellectual property rights and to respond to changes in technology and technological risks and to claims by others that Visteon infringes their intellectual property rights.

•Visteon’s ability to quickly and adequately remediate control deficiencies in its internal control over financial reporting.

•Other factors, risks and uncertainties detailed from time to time in Visteon’s Securities and Exchange Commission filings.

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~~Item 3.~~	~~Quantitative and Qualitative Disclosures About Market Risk~~

Item 3.Quantitative and Qualitative Disclosures About Market Risk

The primary market risks to which the Company is exposed ~~includes~~include changes in ~~foreign~~ currency exchange rates, interest rates and certain commodity prices. The Company manages these risks through ~~derivative instruments and various~~ operating actions including fixed price contracts with suppliers and cost sourcing arrangements with ~~customers.~~customers and through various derivative instruments. The Company's use of derivative instruments is ~~limited~~strictly intended for hedging purposes to ~~mitigation of~~mitigate market risks ~~including hedging activities. However,~~pursuant to written risk management policies. Accordingly, derivative instruments are not used for speculative or trading ~~purposes, as per clearly defined risk management policies.~~purposes. The Company's use of derivative instruments ~~may entail risk of~~creates exposure to credit loss in the event of non-performance ~~of a~~by the counter-party to athe derivative financial ~~derivative contract.~~instruments. The Company limits ~~its counterparty~~this exposure by entering into agreements directly with a variety of major financial institutions with high credit ~~profiles~~standards and that are expected to ~~support an expectation that the counterparty is capable of meeting the~~fully satisfy their obligations under the contracts. ~~In addition,~~Additionally, the Company's ability to utilize derivatives to manage market risk is dependent on credit conditions, ~~and~~ market conditions, ~~given the current~~and prevailing economic environment.

Foreign Currency Risk

The Company's ~~net~~ cash ~~inflows and outflows that~~flows are exposed to the risk of adverse changes in exchange rates as related to the sale of products in countries other than the manufacturing source, foreign currency denominated supplier payments, debt and other payables, ~~subsidiary~~ dividends, investments in subsidiaries, and anticipated foreign currency denominated transaction proceeds. ~~The~~Where possible, the Company utilizes derivative financial instruments to manage foreign currency exchange rate risks. Forward and option contracts may be utilized to ~~reduce~~mitigate the impact toexchange rate variability on the Company's cash ~~flows from adverse movements in exchange rates.~~flows. Foreign currency exposures are reviewed periodically and any natural offsets are considered prior to entering into a derivative financial ~~derivative~~ instrument. The Company’s current primary hedged ~~foreign~~ currency exposures include ~~Euro, Japanese Yen, Thailand Bhat~~the euro, Chinese renminbi, Brazilian real, Indian rupee, and ~~Mexican Peso.~~Bulgarian lev. The Company utilizes a strategy of partial coverage for transactions in these currencies. The Company's policy requires that hedge transactions relate to a specific portion of the exposure not to exceed the aggregate amount of the underlying transaction. As of September 30, 2017, and December 31, 2016, the net fair value of foreign currency forward and option contracts was a net liability of $4 million and less than $1 million, respectively. Maturities of these instruments generally do not exceed eighteen months.

In addition to the transactional exposure described above, the Company's operating results are impacted by the translation of its foreign operating income into U.S. dollars.

~~During 2015, the~~ The Company ~~entered~~does not enter into ~~cross~~ currency ~~swap transactions~~exchange rate contracts to mitigate the variability of the value of the Company's investment in certain non-U.S. entities. In April 2017, the Company terminated and received $5 million of proceeds upon settlement. There was no ineffectiveness associated with such derivatives at the time of the termination. The Company subsequently entered into new cross currency swap transactions with an aggregate notional amount of $150 million. The transactions are designated as net investment hedges of certain of the Company's European affiliates. Accordingly, the effective portion of changes in the fair value of the transactions are recognized in other comprehensive income, a component of shareholders' equity. There was no ineffectiveness associated with such derivatives as of September 30, 2017 and December 31, 2016 and the fair value of these derivatives was a liability of $19 million and an asset of $6 million, respectively.

this exposure.

The hypothetical pre-tax gain or loss in fair value from a 10% favorable or adverse change in quoted currency exchange rates would be ~~approximately~~ $30 million and ~~$31~~$29 million for ~~foreign~~ currency derivative financial instruments as of ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, respectively. These estimated changes assume a parallel shift in all currency exchange rates and include the gain or loss on financial instruments used to hedge ~~loans to~~investments in subsidiaries. AsBecause exchange rates typically do not all move in the same direction, the estimate may overstate the impact of changing exchange rates on the net fair value of the Company's financial derivatives. It is also important to note that gains and losses indicated in the sensitivity analysis would generally be offset by gains and losses on the underlying exposures being hedged.

Interest Rate Risk

The Company is subject to interest rate risk principally in relation to variable-rate debt. The Company uses financial derivative instruments to manage exposure to fluctuations in interest rates in accordance with its risk management policies. During 2015, the Company entered into interest rate swaps to manage interest rate risk relatedSee Note 13, "Fair Value Measurements and Financial Instruments" to the ~~variable rate interest payments of the Term Facility. In April 2017, the Company terminated these swaps and paid $1 million to settle the contracts.~~

During the second quarter of 2017, the Company entered into new interest rate swap contracts with an aggregate notional value of $150 million to effectively convert designated interest payments related to the amended Term Facility from variable to fixed cash flows. The maturities of these swaps do not exceed the underlying amended Term Facility. The instruments have been designated as cash flow hedges and accordingly, the effective portion of the changescondensed consolidated financial statements included in ~~the fair value of the swap transactions are initially recognized in other comprehensive income. Subsequently, the accumulated gains and losses recorded in equity are~~

~~Table of Contents~~

reclassified to income in the period during which the hedged transaction impacts earnings. The ineffective portion of changes in the fair value of the swap transactions, if any, are recognized directly in income. As of September 30, 2017 and December 31, 2016, the fair value of the Company's interest rate swaps was an asset of less than $1 million and a liability of $1 million, respectively. There has been no ineffectiveness associated with these derivatives.

The Company significantly reduced interest rate exposure after entering the swap transactions in 2015. The variable rate basis of debt is approximately 60% and 59% as of September 30, 2017 and December 31, 2016, respectively.

Item 1 for additional information.

Commodity Risk

The Company's exposures to market risk ~~arising~~ from changes in the price of production material are managed primarily through negotiations with suppliers and customers, although there can be no assurance that the Company will recover all such costs. The Company continues to evaluate derivatives available in the marketplace and may ~~determine~~decide to utilize derivatives in the ~~future.~~future to manage select commodity risks if an acceptable hedging instrument is identified for the Company's exposure level at that time, as well as the effectiveness of the financial hedge among other factors.


~~Item 4.~~	~~Controls and Procedures~~

Item 4.Controls and Procedures

Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in periodic reports filed with the SEC under the Securities Exchange Act of 1934 is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including its Chief Executive Officer and ~~Executive~~Senior Vice President and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

As of ~~September 30, 2017,~~March 31, 2022, an evaluation was performed under the supervision and with the participation of the Company’s management, including its Chief Executive Officer and Senior Vice President and Chief Financial Officer, of the effectiveness of the design and operation of disclosure controls and procedures. Based on that evaluation, the Chief Executive Officer and ~~Executive~~Senior Vice President and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of ~~September 30, 2017.~~

March 31, 2022.

Internal Control over Financial Reporting

There were no changes in the Company's internal control over financial reporting during the three months ended ~~September 30, 2017~~March 31, 2022 that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

~~Table of Contents~~

Part II

Other Information


~~Item 1.~~	~~Legal Proceedings~~

Item 1. Legal Proceedings

See the information above under Note ~~17,~~14, "Commitments and Contingencies," to the condensed consolidated financial statements which is incorporated herein by reference.


~~Item 1A.~~	~~Risk Factors~~

Item 1A.Risk Factors

~~For information regarding factors that could affect the Company's results~~Except as set forth below, as of ~~operations, financial condition and liquidity, see~~March 31, 2022, there have been no material changes to the risk factors ~~discussed~~that were previously disclosed in Item 1A in the Company’s Form 10-K for the year ended December 31, 2021 filed with the SEC on February 17, 2022.

We are currently operating in a period of significant macro-economic uncertainty, including supply-chain disruptions and COVID-related lockdowns and increasing inflationary pressures and component costs. Although we have minimal operations in Russia, the conflict in Ukraine and the current COVID-related lockdowns in China are exacerbating component cost increases, supply chain challenges including the availability of natural resources used in production by our suppliers, and volatility with our customers’ production schedules. If the conflict in Ukraine continues for a lengthy period or spreads or the COVID-related lockdowns in China continue for a lengthy period or spread, it may have a materially negative impact on our business and results of operations.

The macro-economic uncertainty has been exacerbated by the conflict in Ukraine. Although the length and impact of the ongoing conflict is highly unpredictable, it has exacerbated the availability, and volatility in prices, of commodities and components, inflationary pressures, credit markets, foreign exchange rates and supply chain disruptions. Furthermore, governments in the United States, United Kingdom, Canada and European Union have each imposed financial and economic sanctions on certain industry sectors and parties in Russia. These sanctions include controls on the export, re-export, and in-country transfer in Russia of certain goods, supplies, and technologies, including some that we use in our business in Russia. Existing or additional sanctions could further adversely affect the global economy, lead to litigation related to compliance with such sanctions, or further disrupt the global supply chain. Inflation is also currently high world-wide and may continue for an unforeseen time.

The negative impact of the conflict in Ukraine and the current COVID lock-downs in China may exacerbate cost increases in raw material, transportation, energy, and commodities. Although we are negotiating with our customers with respect to these additional cost increases, commercial negotiations with our customers may not be successful or may not offset all of the adverse impact of higher transportation, energy and commodity costs. Additionally, even if we are successful with respect to negotiations with customers relating to cost increases, there may be delay before we recover any increased costs. These may have a material negative impact on our business and results of operations.

For additional information see Part I, ~~"Item 1A. Risk~~Item 1A, "Risk Factors" in ~~the Company's~~our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2021 filed with the SEC on February 17, 2022. See also, "Forward-Looking Statements" included in Part I, Item 2 of this Quarterly Report on Form 10-Q.


~~Item 2.~~	~~Unregistered Sales of Equity Securities and Use of Proceeds~~

~~Period~~Item 2.Unregistered Sales of Equity Securities and Use of Proceeds

~~The following table summarizes information relating to~~There were no purchases made by or on behalf of the Company, or an affiliated purchaser, of shares of the Company’s common stock during the ~~third~~first quarter of ~~2017.~~2022.

Period Total Number of Shares (or Units) Purchased (1) Average Price Paid per Share (or Unit) Total Number of Shares (or units) Purchased as Part of Publicly Announced Plans or Programs (2) Approximate Dollar Value of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs (3) (in millions)
Jul. 1, 2017 to Sep. 30, 2017 82,780
$121.24 82,513
$230
Total 82,780
$121.24 82,513
$230


~~(1)~~	Includes 267 shares surrendered to the Company by employees to satisfy tax withholding obligations in connection with the vesting of restricted share and stock unit awards made pursuant to the Visteon Corporation 2010 Incentive Plan.


~~(2)~~	~~During the third quarter 2017 the Company acquired 82,513 shares from the open market share repurchases.~~


~~(3)~~	On January 10, 2017, the Company's board of directors authorized $400 million of share repurchase of its shares of common stock. As of September 30, 2017, there is $230 million remaining on the authorization. Additional repurchases of common stock, if any, may occur at the discretion of the Company.


~~Item 6.~~	~~Exhibits~~

Item 6.Exhibits

The exhibits listed on the "Exhibit Index" on Page 4935 hereof are filed with this report or incorporated by reference as set forth therein.

~~Table of Contents~~

Exhibit Index



Exhibit No.						Description
31.1						Rule 13a-14(a) Certification of Chief Executive Officer dated ~~October 26, 2017.~~April 28, 202 2 .
31.2						Rule 13a-14(a) Certification of ~~Executive~~Senior Vice President, Chief Financial Officer dated ~~October 26, 2017.~~April 28, 202 2 .
32.1						Section 1350 Certification of Chief Executive Officer dated ~~October 26, 2017.~~April 28, 202 2 .
32.2						Section 1350 Certification of ~~Executive~~Senior Vice President, Chief Financial Officer dated ~~October 26, 2017.~~April 28, 202 2 .
101.INS						XBRL Instance Document.**
101.SCH						XBRL Taxonomy Extension Schema Document.**
101.CAL						XBRL Taxonomy Extension Calculation Linkbase Document.**
101.LAB						XBRL Taxonomy Extension Label Linkbase Document.**
101.PRE						XBRL Taxonomy Extension Presentation Linkbase Document.**
101.DEF						XBRL Taxonomy Extension Definition Linkbase Document.**


*	~~Indicates that exhibit is a management contract or compensatory plan or arrangement.~~

* Indicates that exhibit is a management contract or compensatory plan or arrangement.

** Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files as Exhibit 101 hereto are deemed not filed or part of a registration

statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes

of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

In lieu of filing certain instruments with respect to long-term debt of the kind described in Item 601(b)(4) of Regulation S-K, Visteon agrees to furnish a copy of such instruments to the Securities and Exchange Commission upon request.

Signatures

Pursuant to the requirements of Section 13 of the Securities Exchange Act of 1934, Visteon Corporation has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.


	VISTEON CORPORATION

	~~VISTEON CORPORATION~~By:	/s/ Abigail S. Fleming
		Abigail S. Fleming
	~~By:~~	~~/s/ Stephanie S. Marianos~~
~~Stephanie S. Marianos~~
Vice President and Chief Accounting Officer

Date: April 28, 2022

~~Date: October 26, 2017~~



State of ~~Delaware~~	Delaware		38-3519512
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)
One Village Center Drive,	Van Buren Township, ~~Michigan~~	Michigan	48111
(Address of principal executive offices)			(Zip code)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, Par Value $.01 Per Share	VC	The NASDAQ Stock Market LLC



Part I - Financial Information		Page
	Item 1 - Condensed Consolidated Financial Statements	3
	Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited)	3
	Condensed Consolidated Balance Sheets (Unaudited)	4
	Condensed Consolidated Statements of Cash Flows (Unaudited)	5
	Condensed Consolidated Statements of Changes in Equity (Unaudited)	6
	Notes to Condensed Consolidated Financial Statements (Unaudited)	67
	Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations	2923
	Item 3 - Quantitative and Qualitative Disclosures about Market Risk	4632
	Item 4 - Controls and Procedures	4733
Part II - Other Information		4834
	Item 1 - Legal Proceedings	4834
	Item 1A - Risk Factors	4834
	Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds	4834
	Item 6 - Exhibits	4834
Exhibit Index		4935
Signatures		4935


	(Unaudited)
	March 31,		December 31,
	2022		2021
ASSETS
Cash and equivalents	$	402	$	452
Restricted cash	3		3
Accounts receivable, net	539		549
Inventories, net	331		262
Other current assets	176		158
Total current assets	1,451		1,424
Property and equipment, net	374		388
Intangible assets, net	116		118
Right-of-use assets	133		139
Investments in non-consolidated affiliates	58		54
Other non-current assets	111		111
Total assets	$	2,243	$	2,234
LIABILITIES AND EQUITY
Short-term debt	$	—	$	4
Accounts payable	539		522
Accrued employee liabilities	68		80
Current lease liability	28		28
Other current liabilities	214		218
Total current liabilities	849		852
Long-term debt, net	349		349
Employee benefits	190		198
Non-current lease liability	111		117
Deferred tax liabilities	28		27
Other non-current liabilities	74		75
Stockholders’ equity:
Preferred stock (par value $0.01, 50 million shares authorized, none outstanding as of March 31, 2022 and December 31, 2021)	—		—
Common stock (par value $0.01, 250 million shares authorized, 55 million shares issued, 28 million shares outstanding as of March 31, 2022 and December 31, 2021)	1		1
Additional paid-in capital	1,339		1,349
Retained earnings	1,686		1,664
Accumulated other comprehensive loss	(225)		(229)
Treasury stock	(2,260)		(2,269)
Total Visteon Corporation stockholders’ equity	541		516
Non-controlling interests	101		100
Total equity	642		616
Total liabilities and equity	$	2,243	$	2,234



	(Unaudited)
	September 30			December 31
	2017			2016
ASSETS
Cash and equivalents	$	732		$	878
Restricted cash	3			4
Accounts receivable, net	506			505
Inventories, net	174			151
Other current assets	181			170
Total current assets	1,596			1,708

Property and equipment, net	361			345
Intangible assets, net	128			129
Investments in non-consolidated affiliates	40			45
Other non-current assets	154			146
Total assets	$	2,279		$	2,373

LIABILITIES AND EQUITY
Short-term debt, including current portion of long-term debt	$	44		$	36
Accounts payable	429			463
Accrued employee liabilities	102			103
Other current liabilities	235			309
Total current liabilities	810			911

Long-term debt	347			346
Employee benefits	305			303
Deferred tax liabilities	22			20
Other non-current liabilities	62			69

Stockholders’ equity:
Preferred stock (par value $0.01, 50 million shares authorized, none outstanding as of September 30, 2017 and December 31, 2016)	—			—
Common stock (par value $0.01, 250 million shares authorized, 55 million shares issued, 31 and 33 million shares outstanding as of September 30, 2017 and December 31, 2016, respectively)	1			1
Additional paid-in capital	1,333			1,327
Retained earnings	1,420			1,269
Accumulated other comprehensive loss	(194		)	(233		)
Treasury stock	(1,945		)	(1,778		)
Total Visteon Corporation stockholders’ equity	615			586
Non-controlling interests	118			138
Total equity	733			724
Total liabilities and equity	$	2,279		$	2,373


þ	~~QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)~~ ☑QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)


¨	~~TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)~~ ☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)


	Three Months Ended March 31,
	2022		2021
Net sales	$	818	$	746
Cost of sales	(742)		(673)
Gross margin	76		73
Selling, general and administrative expenses	(44)		(45)
Restructuring and impairment	(7)		1
Interest expense	(3)		(3)
Interest income	1		1
Equity in net income of non-consolidated affiliates	3		—
Other income, net	5		4
Income (loss) before income taxes	31		31
Provision for income taxes	(8)		(12)


Net income (loss)	23		19
Less: Net (income) loss attributable to non-controlling interests	(1)		(3)
Net income (loss) attributable to Visteon Corporation	$	22	$	16

Comprehensive income (loss)	$	27	$	1
Less: Comprehensive (income) loss attributable to non-controlling interests	(1)		(2)
Comprehensive income (loss) attributable to Visteon Corporation	$	26	$	(1)




Basic earnings (loss) per share attributable to Visteon Corporation	$	0.79	$	0.57




Diluted earnings per share attributable to Visteon Corporation	$	0.77	$	0.56



	Three Months Ended September 30					Nine Months Ended September 30
	2017			2016		2017			2016
Sales	$	765		$	770	$	2,349		$	2,345
Cost of sales	649			665		1,990			2,010
Gross margin	116			105		359			335
Selling, general and administrative expenses	54			53		158			163
Restructuring expense	6			5		10			22
Interest expense	4			6		15			14
Interest income	1			1		3			4
Equity in net income of non-consolidated affiliates	1			—		6			3
Other (income) expense, net	(1		)	12		(3		)	16
Income before income taxes	55			30		188			127
Provision for income taxes	8			5		34			27
Net income from continuing operations	47			25		154			100
Income (loss) from discontinued operations, net of tax	—			7		8			(15		)
Net income	47			32		162			85
Net income attributable to non-controlling interests	4			4		11			12
Net income attributable to Visteon Corporation	$	43		$	28	$	151		$	73

Basic earnings (loss) per share:
Continuing operations	$	1.38		$	0.62	$	4.50		$	2.47
Discontinued operations	—			0.21		0.25			(0.42		)
Basic earnings per share attributable to Visteon Corporation	$	1.38		$	0.83	$	4.75		$	2.05

Diluted earnings (loss) per share:
Continuing operations	$	1.35		$	0.61	$	4.43		$	2.44
Discontinued operations	—			0.20		0.25			(0.41		)
Diluted earnings per share attributable to Visteon Corporation	$	1.35		$	0.81	$	4.68		$	2.03

Comprehensive income:
Comprehensive income	$	59		$	35	$	205		$	106
Comprehensive income attributable to Visteon Corporation	$	53		$	31	$	190		$	96


	Total Visteon Corporation Stockholders' Equity
	Common Stock		Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Treasury Stock		Total Visteon Corporation Stockholders' Equity		Non-Controlling Interests		Total Equity
December 31, 2021	$	1	$	1,349	$	1,664	$	(229)	$	(2,269)	$	516	$	100	$	616
Net income (loss)	—		—		22		—		—		22		1		23
Other comprehensive income (loss)	—		—		—		4		—		4		—		4
Stock-based compensation, net	—		(10)		—		—		9		(1)		—		(1)

March 31, 2022	$	1	$	1,339	$	1,686	$	(225)	$	(2,260)	$	541	$	101	$	642



Assets Acquired:			Liabilities Assumed:
Accounts receivable	$	1	Deferred tax liabilities	$	2
Intangible assets	7		Total liabilities assumed	2
Goodwill	11
Total assets acquired	$	19	Purchase price	$	17


(In millions)
December 31, 2021	$	18
Expense	2
Change in estimate	1
Payments	(5)
March 31, 2022	$	16



	Electronics			Other			Total
	(Dollars in Millions)
December 31, 2016	$	31		$	9		$	40
Expense	1			—			1
Utilization	(8		)	(1		)	(9		)
March 31, 2017	24			8			32
Expense	6			—			6
Utilization	(6		)	(1		)	(7		)
Reversals	(2		)	(1		)	(3		)
Foreign currency	2			—			2
June 30, 2017	24			6			30
Expense	7			—			7
Utilization	(11		)	—			(11		)
Reversals	(1		)	—			(1		)
Foreign currency	1			—			1
September 30, 2017	$	20		$	6		$	26



	Definite-lived intangibles										Indefinite-lived intangibles
	Developed Technology			Customer Related			Capitalized Software Development		Other		Goodwill		Total
	(Dollars in Millions)
December 31, 2016	$	15		$	58		$	4	$	7	$	45	$	129
Additions	—			—			2		2		—		4
Foreign currency	1			2			—		—		1		4
Amortization	(3		)	(6		)	—		—		—		(9		)
September 30, 2017	$	13		$	54		$	6	$	9	$	46	$	128



	Nine Months Ended September 30, 2017
	(Dollars in Millions)
Beginning balance	$	35
Tax positions related to current period:
Additions	2
Tax positions related to prior periods:
Reductions	(21		)
Effect of exchange rate changes	1
Ending balance	$	17



	2017									2016
	Visteon			NCI			Total			Visteon			NCI			Total
	(Dollars in Millions)
Three Months Ended September 30
Beginning balance	$	569		$	136		$	705		$	616		$	148		$	764
Net income from continuing operations	43			4			47			21			4			25
Net income from discontinued operations	—			—			—			7			—			7
Net income	43			4			47			28			4			32
Other comprehensive income (loss)
Foreign currency translation adjustments	17			2			19			7			—			7
Net investment hedge	(7		)	—			(7		)	(4		)	—			(4		)
Benefit plans	(1		)	—			(1		)	—			—			—
Unrealized hedging gain	1			—			1			—			—			—
Total other comprehensive income	10			2			12			3			—			3
Stock-based compensation, net	3			—			3			1			—			1
Share repurchase	(10		)	—			(10		)	—			—			—
Dividends to non-controlling interests	—			(24		)	(24		)	—			(6		)	(6		)
Ending balance	$	615		$	118		$	733		$	648		$	146		$	794


	Recorded Income (Loss) into AOCI, net of tax				Reclassified from AOCI into Income (Loss)				Recorded in (Income) Loss
(In millions)	2022		2021		2022		2021		2022		2021
Three months ended March 31,
Foreign currency risk - Cost of sales:
Cash flow hedges	$	—	$	—	$	—	$	—	$	3	$	—
Interest rate risk - Interest expense, net:
Interest rate swap	3		—		(1)		(1)		—		—
Net investment hedges	8		14		2		1		—		—
	$	11	$	14	$	1	$	—	$	3	$	—



	Recorded (Loss) Income into AOCI, net of tax						Reclassified from AOCI into (Income) Loss					Recorded in (Income) Loss
	2017			2016			2017		2016			2017			2016
	(Dollars in Millions)
Three Months Ended September 30
Foreign currency risk - Cost of sales:
Cash flow hedges	$	(1	)	$	(3	)	$	2	$	—		$	—		$	—
Net investment hedges	(7		)	(1		)	—		—			—			—
Non-designated cash flow hedges	—			—			—		—			1			(2		)
Interest rate risk - Interest expense, net:
Interest rate swap	—			2			—		1			—			—
	$	(8	)	$	(2	)	$	2	$	1		$	1		$	(2	)
Nine Months Ended September 30
Foreign currency risk - Cost of sales:
Cash flow hedges	$	(1	)	$	—		$	5	$	(3	)	$	—		$	—
Net investment hedges	(20		)	(3		)	—		—			—			—
Non-designated cash flow hedges	—			—			—		—			(2		)	(3		)
Interest rate risk - Interest expense, net:
Interest rate swap	—			(2		)	1		1			—			—
	$	(21	)	$	(5	)	$	6	$	(2	)	$	(2	)	$	(3	)


~~Item 2.~~	~~Management's Discussion and Analysis of Financial Condition and Results of Operations~~



Period	Total Number of Shares (or Units) Purchased (1)	Average Price Paid per Share (or Unit)	Total Number of Shares (or units) Purchased as Part of Publicly Announced Plans or Programs (2)	Approximate Dollar Value of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs (3) (in millions)
Jul. 1, 2017 to Sep. 30, 2017	82,780	$121.24	82,513	$230
Total	82,780	$121.24	82,513	$230