Ford Motor 2025 Q2 Earnings Misses Targets with Net Income Down 101.6%

Ford Motor reported its fiscal 2025 Q2 earnings on Jul 31st, 2025. Ford Motor exceeded revenue expectations with $50.2 billion, surpassing the consensus estimate of $43.93 billion. However, adjusted EPS of $0.37 also beat estimates of $0.33, but GAAP net income swung to a loss due to special charges. Full-year guidance was reinstated with adjusted EBIT expected between $6.5 billion to $7.5 billion, indicating a reduced outlook from initial projections. The company's financial performance was affected by tariff impacts and rising costs.

Revenue
The total revenue of Ford Motor increased by 5.0% to $50.18 billion in 2025 Q2, up from $47.81 billion in 2024 Q2. The revenue breakdown for Ford is as follows: Excluding Ford Credit, the company achieved $46.94 billion, while Ford Credit contributed $3.24 billion, culminating in total revenues of $50.18 billion.

Earnings/Net Income
Ford Motor swung to a loss of $0.01 per share in 2025 Q2 from a profit of $0.46 per share in 2024 Q2, representing a negative change of 102.2%. The company reported a net loss of $-29 million in 2025 Q2, reflecting a 101.6% deterioration from the net income of $1.83 billion achieved in 2024 Q2. The EPS performance was disappointing, indicating a challenging quarter for Ford.

Price Action
The stock price of Ford Motor edged up 2.76% during the latest trading day, declined 1.69% during the most recent full trading week, and rose 2.03% month-to-date.

Post-Earnings Price Action Review
The strategy of buying Ford shares when earnings surpass expectations, then holding for 30 days, resulted in moderate returns but fell short of benchmark performance. The strategy delivered an 80.12% return, with a Sharpe ratio of 0.32, suggesting a reasonable risk-adjusted return. However, it experienced a maximum drawdown of 0.00%, indicating no risk of losses, and displayed a volatility of 38.86%, reflecting substantial price fluctuations. While promising, the strategy's returns did not fully capitalize on market potential, highlighting the need for improved risk management and strategic adjustments. Investors should be cautious of the volatility and consider diversifying to mitigate potential risks associated with Ford's stock movements post-earnings.

CEO Commentary
Jim Farley, CEO of Ford Motor Company, expressed optimism regarding the company's strategic execution under the Ford+ plan, emphasizing that Ford Pro continues to be a significant competitive advantage driving growth. He highlighted the robust demand within the commercial vehicle sector and noted that the company's focus on enhancing software and services is opening new high-margin revenue streams. Farley acknowledged the ongoing challenges posed by tariffs but underscored that Ford is committed to adapting its strategies amidst changing market dynamics. He reaffirmed the company's dedication to strengthening its operations and improving vehicle quality, aiming for greater efficiency and sustainability in its manufacturing processes.

Guidance
Ford has reinstated its full-year 2025 guidance, anticipating adjusted EBIT between $6.5 billion and $7.5 billion, alongside adjusted free cash flow projected at $3.5 billion to $4.5 billion. The capital expenditure is expected to be approximately $9 billion. The company acknowledges a tariff-related EBIT headwind of about $2 billion, reflecting increased costs due to ongoing trade policies. These numbers indicate a cautious yet hopeful outlook as Ford navigates the current economic landscape.

Additional News
Ford is preparing to unveil more details about its low-cost electric vehicle initiative on August 11th, 2025, in Kentucky. CEO Jim Farley confidently stated that this event marks a pivotal moment for Ford, reminiscent of the revolutionary Model T era. The automaker is focusing on introducing affordable EVs to expand accessibility for consumers. This announcement follows Ford’s recent financial updates, where the company highlighted its strategic commitment to developing cost-effective electric vehicles, driven by a dedicated team including former Tesla executives. As Ford continues to innovate in the EV space, it aims to maintain its competitive edge and broaden its market presence amidst evolving industry dynamics.