Ford Motor reported its largest quarterly earnings miss in four years, underscoring the cost pressures still facing global automakers, even as the company struck an optimistic tone about a recovery beginning in 2026.
For the fourth quarter, Ford posted adjusted earnings of 13 cents per share, well below the 19 cents expected by analysts, according to LSEG. Revenue offered a bright spot, coming in at $42.4 billion, slightly ahead of forecasts.
The earnings shortfall marked Ford’s first quarterly miss since 2024 and its showiest stumble since late 2021, when results diverged sharply from Wall Street expectations.
Tariffs and Supply Shocks Take a Toll
The primary drag came from unexpected tariff-related costs totaling roughly $900 million. Ford said credits for auto parts failed to materialize as early as anticipated, forcing the company to absorb higher expenses during the quarter.
Those costs shaved down what had been tracking as $7.7 billion in earnings before interest and taxes to $6.8 billion by quarter-end.
Compounding the issue were lingering effects from a fire at a Novelis aluminum supplier plant in New York, a key source for the company’s high-margin F-Series pickup trucks. The facility is not expected to return to full operations until mid-2026, pushing Ford to source aluminum elsewhere at higher tariff-inclusive prices.
“We expect a billion-dollar benefit in 2026,” CFO Sherry House said, “but in the near term, replacement sourcing is offsetting those gains.”
2026 Framed as a Turning Point
Despite the weak quarter, Ford is leaning heavily into its 2026 rebound narrative. The company guided for:
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Adjusted EBIT: $8 billion to $10 billion
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Adjusted free cash flow: $5 billion to $6 billion
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Capital expenditures: $9.5 billion to $10.5 billion
That outlook implies meaningful improvement over last year’s $6.8 billion in adjusted EBIT and $3.5 billion in free cash flow, signaling management’s confidence that cost pressures will ease and operations will stabilize.
Business Units Tell a Mixed Story
Ford’s performance continues to diverge sharply across its business lines. The Model e electric vehicle unit is expected to lose $4 billion to $4.5 billion this year, reflecting slower EV adoption and heavy investment costs.
Those losses are projected to be offset by stronger profits elsewhere. The Ford Pro commercial and fleet business is forecast to generate $6.5 billion to $7.5 billion in pre-tax earnings, while the traditional Ford Blue unit is expected to add another $4 billion to $4.5 billion.
Headline Loss Masks Core Progress
On an unadjusted basis, Ford reported a net loss of $8.2 billion for the year, its largest since the 2008 financial crisis. The figure was heavily influenced by $15.5 billion in special charges, largely tied to a pullback from aggressive all-electric vehicle plans.
Fourth-quarter net loss totaled $11.1 billion, compared with a profit a year earlier. Stripped of one-time items, however, Ford remained profitable, highlighting the gap between reported losses and the underlying business.
What this really shows is a company still wrestling with external shocks, but increasingly confident that the worst is temporary. For Ford, 2026 isn’t just another forecast year. It’s the reset investors will be watching closely.
