Form 4: Autoliv Executive's Equity Holdings Update

Autoliv's President of Autoliv Europe, Magnus Jarlegren, reported the vesting of performance-based restricted stock units and the earning of new grants based on 2025 performance goals.

Summary

• Magnus Jarlegren, President of Autoliv Europe, reported changes in his beneficial ownership of Autoliv Inc. securities.
• On February 19, 2026, 2,592 shares of common stock were acquired through the vesting of performance-based restricted stock units.
• Following this transaction, Jarlegren directly beneficially owns 9,337 shares of common stock.
• Performance-based Restricted Stock Units (2023 Grant): 603.9274 units were earned for the 2025 performance period, and 2,592.9234 units vested and converted to common stock.
• Performance-based Restricted Stock Units (2024 Grant): 764.1264 units were earned for the 2025 performance period, with 1,409.7836 units remaining beneficially owned and vesting after 2026.
• Performance-based Restricted Stock Units (2025 Grant): 925.9299 units were earned for the 2025 performance period, with 925.9299 units remaining beneficially owned and vesting after 2027.
• An additional 599 Restricted Stock Units were acquired on February 19, 2026, which will vest on February 19, 2029.
• For the 2025 performance period, the Earnings Per Share (60%) and Greenhouse Gas Emissions (15%) goals for the performance-based RSUs were achieved above the threshold level.

Sentiment

Score: 7

Explanation: StockSavvy.ai views this as a positive signal, as the achievement of performance goals above threshold for key financial and ESG metrics reflects strong operational execution and aligns executive incentives with shareholder value and sustainability objectives.

Positives

• Achievement of Earnings Per Share (60%) and Greenhouse Gas Emissions (15%) performance goals above the threshold level for the 2025 calendar year, indicating strong company performance in these areas.
• The vesting of 2,592 performance-based restricted stock units into common stock for Magnus Jarlegren, reflecting earned compensation.

Negatives

• Fractional RSUs are rounded down to the nearest whole number at vesting, resulting in forfeiture of fractional amounts.

Risks

• Continued employment is a condition for the vesting of all performance-based restricted stock units.
• The actual number of shares received from performance-based RSUs is contingent on the achievement of pre-determined performance goals, which may not always be met at or above threshold levels.

Future Outlook

The filing indicates future vesting events for performance-based restricted stock units, with the 2024 grant vesting after 2026 and the 2025 grant vesting after 2027, contingent on continued employment and certification of performance objectives by the Leadership Development and Compensation Committee. A separate grant of 599 Restricted Stock Units is set to vest on February 19, 2029.

Management Comments

• Each RSU represents a contingent right to receive one share of ALV common stock.
• Fractional RSUs are rounded down to the nearest whole number at vesting, the fractional amount is forfeited.
• All PSUs will vest following [specific year], to the extent earned and subject to the reporting person's continued employment.
• Reflects the PSUs that were earned over the [specific] one-year performance period (January 1, 2025 December 31, 2025) based on the level of achievement of pre-determined performance goals related to (i) Organic Sales Growth vs. Light Vehicle Production Growth (25%), (ii) Earnings Per Share (60%), and (iii) Greenhouse Gas Emissions (15%). The goals for (ii) and (iii) were achieved above the threshold level.

Industry Context

StockSavvy.ai notes that the use of performance-based restricted stock units tied to metrics like Organic Sales Growth, Earnings Per Share, and Greenhouse Gas Emissions aligns with broader industry trends in executive compensation, emphasizing both financial performance and environmental, social, and governance (ESG) factors. This structure aims to incentivize long-term value creation and sustainability within the automotive safety systems sector.

Comparison to Industry Standards

• The inclusion of Greenhouse Gas Emissions as a performance metric (15% weighting) for executive compensation is a growing trend, particularly in industries like automotive suppliers, reflecting increasing investor and regulatory focus on ESG. Companies like Aptiv and Magna International also incorporate sustainability metrics into their executive incentive plans, though specific weightings vary.
• The emphasis on Earnings Per Share (60% weighting) is a standard financial performance metric widely used across industries for executive compensation, comparable to practices at peers such as ZF Friedrichshafen AG (for relevant divisions) or Robert Bosch GmbH (for executive incentives).
• Organic Sales Growth versus Light Vehicle Production Growth (25% weighting) is a highly relevant metric for an automotive supplier like Autoliv, directly linking executive incentives to market share and operational efficiency within its core market, a practice common among automotive component manufacturers.

Related Party Transactions

• The reported transactions involve the compensation of a key executive, Magnus Jarlegren, through equity awards, which are standard related-party transactions between the company and its management.

Stakeholder Impact

• Shareholders: The achievement of performance goals, particularly EPS and GHG emissions, suggests effective management and potential long-term value creation. The alignment of executive compensation with these goals benefits shareholders by incentivizing performance.
• Employees: The continued employment condition for vesting emphasizes the importance of executive retention.
• Customers/Suppliers: The Organic Sales Growth metric indirectly reflects market demand and operational efficiency, which can impact relationships with customers and suppliers.
• Creditors: Strong financial performance (EPS) can positively impact the company's creditworthiness.

Next Steps

• The remaining performance-based RSUs from the 2024 grant will vest following the 2026 calendar year, subject to continued employment and certification of performance.
• The remaining performance-based RSUs from the 2025 grant will vest following the 2027 calendar year, subject to continued employment and certification of performance.
• The newly acquired Restricted Stock Units will vest on February 19, 2029.
• The Leadership Development and Compensation Committee will certify the level of achievement of applicable performance objectives for future vesting events.

Key Dates

Recommendation

While the achievement of performance targets for executive compensation is a positive indicator of operational execution, this Form 4 filing primarily reports routine compensation events. It does not introduce new strategic initiatives or significant financial disclosures that would warrant a change in investment thesis. The information reinforces a stable outlook but lacks catalysts for a strong buy or sell recommendation.

Keywords

Autoliv, ALV, Form 4, Insider Trading, Restricted Stock Units, PSU, Executive Compensation, Magnus Jarlegren, Equity Holdings, Stock Vesting, Corporate Governance