Ford Q4 results hit by tariffs and EV losses, but investors focused on improved outlook-bymostbusiness

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2026-02-12

Ford Q4 results hit by tariffs and EV losses, but investors focused on improved outlook

Ford (F) reported fourth quarter results Tuesday after the bell that missed expectations, with charges stemming from its EV business resulting in a net loss for the quarter and the year. But investors seem to be looking forward, with Ford’s improved outlook in focus.

Looking ahead to 2026 guidance, Ford projected adjusted EBIT of $8 billion to $10 billion, adjusted free cash flow of $5 billion to $6 billion, and capital expenditures of $9.5 billion to $10.5 billion. Ford said it expects its Model e unit to post another loss of $4 billion to $4.5 billion.

Ford stock edged higher in early trade on Wednesday.

Ford said its 2026 first-half EBIT would be lower than the second half of the year, as temporary aluminum sourcing for its F-Series pickups will weigh on costs. Last year, fires at the Novelis aluminum plant in upstate New York hurt pickup production, but Ford said that will “normalize” by the end of the year.

Ford posted a fourth quarter and full-year net loss of $11.1 billion and $8.2 billion, respectively, which reflected the impact of special items, the company said. Ford’s full-year adjusted EBIT of $6.8 billion came in near its forecast of around $7 billion but missed estimates of $8.86 billion.

Ford said it would have had full-year EBIT in the mid $7 billion range if not for a change the White House communicated to Ford regarding tariff-offsets in December, which ended up adding $900 million more in tariff costs.

“The underlying results, both for Q4, the 2026 outlook and even beyond to us were pretty encouraging. If you remove some of the tariff timing issue in Q4, Ford would have beat, including on costs,” said TD Cowen analyst Itay Michaeli in an interview with Yahoo Finance.

Michaeli was also encouraged by Ford’s 2026 outlook.

AUSTIN, TEXAS - JUNE 24: Ford Mustang Mach-E vehicles are seen for sale on a dealership lot on June 24, 2025 in Austin, Texas. Ford Motor is recalling more than 197,000 Mustang Mach-E vehicles after a malfunction with the door latches has surfaced according to the National Highway Traffic Safety Administration. (Photo by Brandon Bell/Getty Images) — Ford Mustang Mach-E vehicles are seen for sale on a dealership lot on June 24, 2025, in Austin, Texas. (Brandon Bell/Getty Images) · Brandon Bell via Getty Images

“Though that also included some non-repeating Novelis items, that suggests a stronger underlying earnings rate than what the street kind of had coming in, and lastly, the company also provided 2029 margin target of about 8%, which supports a much higher earnings power going forward. So we’re actually pretty encouraged with the results last night.”

Ford reported Q4 automotive revenue of $42.40 billion vs. $42.40 billion expected, per Bloomberg consensus, with adjusted earnings per share (EPS) of $0.13 vs. $0.19 expected, on adjusted EBIT of $1 billion vs. $1.16 billion.

Last December, Ford reported a $19.5 billion charge due to a pivot in its EV business. The majority of the special items would be recognized in the fourth quarter ($12.5 billion), with the balance ($7 billion) hitting in 2026 and 2027.

Ford’s Model EV unit reported a $4.8 billion EBIT loss for the year, though it was an improvement over 2024 by 299 basis points. Ford CFO Sherry House said in a call with reporters that the pathway to EV profitability likely won’t happen until 2029, when the company has its EV products from Renault on sale in Europe, and its Universal EV platform vehicles are on sale in the market.

“Ford delivered a strong 2025 in a dynamic and often volatile environment,” Ford CEO Jim Farley said in a statement. “We improved our core business and execution, made significant progress in the areas of the business we control — lowering material and warranty costs and making real progress on quality — and made difficult but critical strategic decisions that set us up for a stronger future.”

House added that Ford was hit by $2 billion in net tariff costs for the year, as well as a $2 billion in added costs due to the Novelis aluminum plant fire that affected F-Series truck production.

“We’re currently expecting to be fully operational somewhere in the middle of the year,” House said regarding the Novelis plant.

Farley added that the company aims to hit an adjusted EBIT margin target of 8% by 2029. In 2025, the company’s EBIT margin was 3.6%.

As part of its Ford+ plan, Ford divided its business into three units: Ford Blue for the traditional gas-powered business, Ford Model e for the electric vehicle division, and Ford Pro for its commercial and super-duty truck business. Ford reported the following for Q4:

Ford Blue: $26.2 billion in revenue, $727.0 million in EBIT
Model e: $1.3 billion in revenue, ($1.22 billion) in EBIT loss
Ford Pro: $14.9 billion in revenue, $1.23 billion in EBIT

Despite issues with the EV business and F-150 production, Ford said US sales in Q4 rose 2.7% versus a year ago, powered by truck and hybrid sales. For the year, the company reported a 6% jump in US sales, totaling approximately 2.2 million vehicles. Ford rival GM posted a 5.5% gain in 2025 sales, resulting in 2.853 million vehicles sold, but reported a Q4 sales dip.

Like GM, Ford’s EV sales tumbled after the expiration of the federal EV tax credit, with EV sales falling 50%. While GM’s Q4 sales slipped due to the credit expiration, Ford was able to report a net gain, driven by sales of its popular hybrid vehicles.

Ford said total hybrid sales hit a record in Q4 and for the year, with 228,072 vehicles sold, a 21.7% gain from a year ago.