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FM

FORD MOTOR CO (F)·Q3 2025 Earnings Summary

Executive Summary

  • Ford delivered a record $50.534B in revenue and $2.586B adjusted EBIT in Q3 2025; adjusted EPS was $0.45 vs S&P Global consensus $0.36, and revenue beat consensus by ~$6.67B. Management highlighted a $0.7B net tariff headwind absorbed in the quarter .
  • Full-year 2025 guidance was updated: adjusted EBIT $6.0–$6.5B (lowered), adjusted FCF $2.0–$3.0B (lowered), capex ~$9B (maintained), incorporating Novelis-related Q4 headwinds and tariff offsets .
  • Segment performance: Ford Pro EBIT $1.985B on $17.4B revenue (11.4% margin), Ford Blue EBIT $1.540B (5.5% margin), Model e EBIT loss ($1.410B) as next-gen EV investment ramped; Ford Pro paid software subs rose 8% sequentially to 818k .
  • Management is adding up to 1,000 jobs and boosting F-150/Super Duty production to recover volume lost to the Novelis fire, a catalyst for 2026 EBIT recovery of ≥$1B and share/mix optimization as compliance headwinds ease .

What Went Well and What Went Wrong

What Went Well

  • Record top-line: “Revenue reached a record $50.5 billion; net income of $2.4 billion and adjusted EBIT was $2.6 billion,” highlighting strong Pro and disciplined cost/quality execution .
  • Cost and quality progress: CFO noted “Adjusting for tariffs, year-over-year adjusted EBIT improved by $0.7 billion,” and Q3 warranty costs were down ~$450M YoY, helping offset tariffs .
  • Pro momentum and software flywheel: Ford Pro EBIT ~$2.0B; paid subscriptions up to 818k, with rising ARPU/attach driving higher service parts capture and durable profitability .

What Went Wrong

  • Tariffs and aluminum disruptions: Q3 reflected a $0.7B net tariff headwind; Q4 guidance embeds Novelis fire headwinds of $1.5–$2.0B EBIT and $2–$3B FCF, pressuring near-term margins/cash .
  • Model e profitability: EBIT loss widened to ($1.410B) on lower net pricing and increased spending for next-gen EV platform; year-to-date loss ~$3.6B (with ~$3B from Gen-1 products) .
  • Currency and pricing normalization: Ford Blue margin slipped to 5.5% (from 6.2% YoY), with adverse exchange (EUR, THB) and tariff impacts muting warranty progress; pricing normalization in Pro in Europe/NA cited .

Financial Results

Quarterly Trend (oldest → newest)

MetricQ1 2025Q2 2025Q3 2025
Revenue ($USD Billions)$40.659 $50.184 $50.534
Adjusted EBIT ($USD Billions)$1.019 $2.140 $2.586
Adjusted EBIT Margin (%)2.5% 4.3% 5.1%
Adjusted EPS (Diluted) ($)$0.14 $0.37 $0.45
GAAP EPS (Diluted) ($)$0.12 ($0.01) $0.60
Net Income ($USD Billions)$0.471 ($0.036) $2.447

Q3 Actual vs Prior Year and vs Estimates

MetricQ3 2024Q3 2025 ActualConsensus (S&P Global)Surprise
Revenue ($USD Billions)$46.196 $50.534 $43.863*+$6.671B
Adjusted EPS (Diluted) ($)$0.49 $0.45 $0.359*+$0.091
Adjusted EBIT Margin (%)5.5% 5.1% n/an/a

Values retrieved from S&P Global.*

Segment Breakdown (Q3 YoY)

SegmentRevenue ($B) Q3 2024Revenue ($B) Q3 2025EBIT ($M) Q3 2024EBIT ($M) Q3 2025EBIT Margin (%) Q3 2024EBIT Margin (%) Q3 2025
Ford Blue$26.2 $28.0 1,624 1,540 6.2% 5.5%
Ford Model e$1.2 $1.8 (1,231) (1,410) (104.8)% (79.1)%
Ford Pro$15.7 $17.4 1,813 1,985 11.6% 11.4%

KPIs and Cash

KPIQ3 2025
Cash from Operations ($USD Billions)$7.402
Adjusted Free Cash Flow ($USD Billions)$4.309
Cash and Equivalents ($USD Billions)$26.788
Marketable Securities ($USD Billions)$15.400
Liquidity ($USD Billions)~$54.0
Ford Pro Paid Software Subscriptions818,000
Dividend Declared (Q4)$0.15 per share
Net Tariff Headwind (Q3)~$0.7B adverse

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Adjusted EBITFY 2025$6.5–$7.5B $6.0–$6.5B Lowered
Adjusted Free Cash FlowFY 2025$3.5–$4.5B $2.0–$3.0B Lowered
Capital ExpendituresFY 2025~$9B ~$9B Maintained
Tariffs (net headwind)FY 2025~$2.0B ~$1.0B (net) Improved
Novelis Headwind (EBIT)Q4 2025n/a$1.5–$2.0B New headwind
Novelis Headwind (Adj. FCF)Q4 2025n/a$2.0–$3.0B New headwind
Production/Jobs Actions2026 recoveryn/a+>50,000 trucks, +~1,000 jobs New operational plan
DividendQ4 2025$0.15 $0.15 Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q-2 and Q-1)Current Period (Q3 2025)Trend
Cost & QualityCFO cited 4th straight quarter of YoY cost improvement excluding tariffs (Q2); Q1 highlighted quality gains Warranty costs down ~$450M YoY; continued material cost improvements Improving
Tariffs/MacroGuidance suspended in Q1 due to tariff uncertainty; reinstated in Q2 with ~$2B net tariff headwind Net tariff headwind now ~$1B; Q4 receivable expected from policy change Easing headwind
Novelis/aluminumn/aQ4 EBIT headwind $1.5–$2.0B; 2026 recovery ≥$1B; production boost to offset Temporary headwind; recovery plan
Pro software & servicesPro subs 757k in Q2 (+24% YoY) Subs 818k (+8% seq); ARPU/attach rising; ServiceTitan partnership Scaling
EV strategyReduced planned battery capacity; canceled three-row program (Q2) Next-gen affordable EV platform; Marshall LFP and Louisville investments Re-focused, cost-led
Regulatory/complianceQ1 noted policy uncertainties; Q2 tariff offset details Anticipated EPA changes remove compliance headwind; unlocks mix optimization Tailwind building
U.S. Market/ProductQ1 Pro downtime; Q2 Pro strength U.S. SAAR ~17M; share 12.8%; hybrid truck ~70% share; Expedition strong Solid demand

Management Commentary

  • CEO Jim Farley: “We not only solidly beat expectations…record $50.5 billion in revenue…We will continue to focus on execution and…strategic calls on propulsion, partnerships and technology” .
  • CFO Sherry House: “Adjusting for tariffs, year-over-year adjusted EBIT improved by $0.7 billion…We ended the quarter with nearly $33 billion in cash and $54 billion in liquidity” .
  • COO Kumar Galhotra: “On cost, we…are on track for a net $1 billion improvement this year, excluding the impact of tariffs…we have added 900 AI-powered cameras across our plants” .
  • President, Ford Blue & Model e, Andrew Frick: “Pro’s paid subscriptions grew 8% to 818,000 subscribers…U.S. share grew to 12.8%…we continue to lead the hybrid truck market with about 70% share” .

Q&A Highlights

  • Novelis impact and recovery cadence: Hot mill expected operational late Nov/early Dec; Q4 wholesales down ~90–100k units; 2026 recovery of ~50k units via Dearborn 3rd crew and higher KTP line speeds .
  • Tariffs accounting: Q4 to recognize ~$1B receivable from recent proclamation, driving full-year net tariff headwind of ~$1B; books for Q3 closed before policy change .
  • Warranty costs: Q3 warranty costs down ~$450M YoY; continued improvements expected as older cohorts run off .
  • Pricing discipline and mix: Industry pricing up ~0.5%; Ford confident in price discipline supported by fresh lineup and strong segment drivers (fuel, construction) .
  • Financing strategy: “No-tier upgrade” marketing for F-150 did not increase risk appetite; high-risk portfolio ~3% and stable .

Estimates Context

  • Q3 2025 results vs S&P Global consensus: Adjusted EPS $0.45 vs $0.359*, a beat of $0.091; Revenue $50.534B vs $43.864B*, a beat of ~$$6.671B .
  • EBITDA: Consensus $3.250B* vs actual $3.112B* (slight miss). Forward consensus indicates Q4 2025 EPS $0.076* and revenue $41.104B*; Q1 2026 EPS $0.255* and revenue $41.355B*.

Values retrieved from S&P Global.*

Key Takeaways for Investors

  • The quarter featured a significant top-line beat and adjusted EPS beat, with durability underpinned by Ford Pro and material/warranty cost improvements despite a $0.7B tariff headwind .
  • Guidance reduction is driven by discrete Q4 Novelis headwinds; the announced production actions and expected ≥$1B 2026 recovery set up EBIT normalization next year .
  • Ford Pro’s software-and-services flywheel is scaling (818k subs), improving capture rates and margins; this is a key multi-year profitability lever .
  • Model e losses are primarily Gen-1 product/regulatory pricing realities; management is reallocating to cost-advantaged next-gen affordable EV platform and hybrid mix optimization as compliance headwinds abate .
  • Tariff backdrop has improved (net ~$1B headwind vs $2B prior), with Q4 receivable aiding year-end cash/EBIT optics; near-term working capital impacts from production disruptions should reverse in 2026 .
  • Expect estimate revisions: upward on Q3 actuals for EPS/revenue; near-term Q4 estimates likely adjust lower for Novelis; 2026 estimates may start embedding compliance-tailwinds and mix optimization .
  • Dividend maintained at $0.15; balance sheet strength (cash $26.8B, liquidity ~$54B) supports continued shareholder returns while funding strategic ICE/hybrid/EV investments .

Additional Context and Sources

  • Ford 8-K (Item 2.02) Q3 2025 and Exhibit 99: full financials, segment details, guidance .
  • Q3 2025 earnings call transcript: strategic themes, tariff mechanics, Novelis recovery, warranty/pricing dynamics .
  • Ford press releases (Oct 23, 2025): Q3 results and production boost plan for F-150/Super Duty .
  • Prior quarters’ 8-Ks for trend analysis: Q2 2025 and Q1 2025 (revenues, margins, guidance history, Pro subs) .