Automaker misses earnings expectations but signals confidence in a multi-year turnaround
Ford Motor Company (F) reported weaker-than-expected fourth-quarter results Tuesday after the bell, with significant charges tied to its electric vehicle strategy and warranty expenses pushing the company into a net loss for both the quarter and the full year. While core operations showed signs of stabilization, investors focused on the near-term financial strain from Ford’s EV pivot.
Ford posted fourth-quarter automotive revenue of $42.4 billion, roughly in line with expectations, but adjusted earnings per share came in at $0.13, below the $0.19 analysts had forecast. Adjusted EBIT totaled $1 billion, also short of consensus estimates. Including special items, Ford recorded a fourth-quarter net loss of $11.1 billion and a full-year net loss of $8.2 billion. The losses were largely driven by restructuring charges associated with the company’s EV business, following a previously announced $19.5 billion write-down.
Ford’s Model e electric vehicle division continued to be a drag, posting a $4.8 billion EBIT loss for the year, though management noted this represented an improvement from 2024. CEO Jim Farley said Ford made “difficult but critical strategic decisions” in 2025, including steps to reduce material and warranty costs and improve quality, positioning the company for longer-term gains.
Looking ahead, Ford offered more optimistic guidance for 2026. The company expects adjusted EBIT of $8 billion to $10 billion and free cash flow of $5 billion to $6 billion, even as it anticipates another $4 billion to $4.5 billion loss from Model e. Capital expenditures are projected at $9.5 billion to $10.5 billion, reflecting continued investment discipline amid a slower EV adoption curve.
Operationally, Ford’s diversified business model helped offset EV softness. The Ford Pro commercial unit and Ford Blue gasoline business remained profitable, while hybrid vehicles emerged as a bright spot. U.S. hybrid sales hit a record in 2025, rising more than 21%, as consumers gravitated toward lower-cost electrification options following the expiration of the federal EV tax credit.
Farley reiterated Ford’s long-term goal of reaching an 8% adjusted EBIT margin by 2029. While EV losses continue to weigh heavily, Ford’s growing hybrid momentum and improving core execution suggest the company is betting on a steadier, more balanced path forward.
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