Ford raised its 2026 earnings forecast on Tuesday after second-quarter adjusted earnings of 42 cents a share beat Wall Street's 35-cent estimate, while automotive revenue of $44.89 billion fell short. The automaker still reported a net loss of $1.3 billion on charges tied to its pullback in all-electric vehicles. Shares rose nearly 7% in after-hours trading.
Ford raised its full-year adjusted earnings before interest and taxes forecast to between $10 billion and $11 billion on Tuesday, up from $8.5 billion to $10.5 billion, after beating Wall Street's second-quarter earnings expectations. The Detroit automaker also lifted its adjusted free cash flow outlook to $6 billion to $7 billion from $5 billion to $6 billion.
Second-quarter adjusted earnings came in at 42 cents a share against the 35 cents expected, based on average estimates compiled by LSEG. Automotive revenue of $44.89 billion missed the $45.86 billion analysts looked for, and the company cited operational improvements, resilient vehicle pricing and a high sales mix of profitable products for both the quarter and the improved guidance.
According to CNBC, Chief Executive Jim Farley said in a release: "We delivered another strong quarter and raised our full-year guidance". Shares rose nearly 7% in after-hours trading Tuesday.
Ford Blue leads the guidance raise
A $500 million expected improvement at Ford Blue led the earnings raise, lifting the traditional vehicle business to between $5 billion and $5.5 billion. Ford also narrowed earnings of its fleet business to between $7 billion and $7.5 billion from a previous low range of $6.5 billion, and cut expected losses at its Model e electric vehicle unit to about $4 billion from previous expectations of $4 billion to $4.5 billion. The additional free cash flow includes an earlier-than-expected cash recovery of $500 million of a previously announced $1.3 billion anticipated tariff reimbursement, the company said.
Margins widen as revenue slips
Total revenue, which includes the financial arm, was down 4% to $48.3 billion compared with a year earlier. Adjusted EBIT reached $2.5 billion, a 17% improvement year-over-year. The adjusted EBIT margin expanded to 5.2%, up 90 basis points from the prior year.
However, Ford reported a net loss of $1.3 billion largely due to one-time special charges related to its previously announced pullback in all-electric vehicles. Those $4.2 billion in charges included $3.6 billion in restructuring of the BlueOval SK joint venture battery plant with SK On and $500 million due to a canceled EV program, leaving a loss wider than the $36 million net loss reported in the second quarter of 2025.
F-Series recovery runs into the second half
Chief Financial Officer Sherry House said the recovery of F-Series pickup truck production will continue into the back half of the year, reconfirming a roughly $1 billion improvement compared with last year's reported impact. Production problems date to two fires at Novelis, the aluminum supplier that provides material for Ford's large trucks and SUVs, which crippled output; Novelis restarted the affected production last month at its New York facility.
The automaker now expects to recover about $2.5 billion of the vehicle volume lost to the fires, the low end of a range of up to $3 billion, which House attributed to the mix of vehicles expected to be produced this year. Heading into the report, Jefferies upgraded Ford and General Motors to buy from hold, with analyst Philippe Houchois saying Ford is on track to start building momentum again and the second quarter set to mark a trough.
Sources: CNBC, Investing.com
Trading involves risk.
Risk Disclaimer
