Ford Motor is set to report earnings after the bell. Here's what Wall Street expects

Ford Motor is poised to report Q3 earnings, with analysts expecting 36 cents adjusted EPS and $43.08 billion in automotive revenue, potentially marking a beat for the quarter. However, Wall Street anticipates a disappointing Q4 outlook and revised 2025 guidance, primarily due to ongoing supply chain constraints from issues like the Novelis plant fire and a higher expected tariff impact, which has lowered its adjusted EBIT forecast from $7-$8.5 billion to $6.5-$7.5 billion.

Analysis

Ford Motor is anticipated to report third-quarter adjusted earnings per share of 36 cents and automotive revenue of $43.08 billion, aligning with prior year revenue but indicating a 26% drop in adjusted EPS. While Wall Street analysts, including JPMorgan's Ryan Brinkman, expect a Q3 earnings beat, the focus remains on potentially disappointing forward guidance. This cautious outlook stems from ongoing supply chain constraints, notably a fire at key aluminum supplier Novelis, which is expected to impact high-profit truck production in Q4.

The company's 2025 adjusted EBIT guidance has been revised downward to $6.5 billion to $7.5 billion, a reduction from the pre-tariff range of $7 billion to $8.5 billion. This adjustment reflects an increased expected tariff impact, which Ford previously upped from $2.5 billion to $3 billion, with only $1 billion expected to be offset. In contrast, rival General Motors recently reduced its tariff impact forecast and expects to offset a larger proportion.

Beyond tariffs and supply chain issues, investors are monitoring Ford's cost-cutting initiatives and quality improvements. Despite the lowered EBIT outlook, the company's adjusted free cash flow guidance remains stable at $3.5 billion to $4.5 billion, and capital spending is projected at approximately $9 billion. The moderately negative sentiment surrounding Ford (F: -0.5) suggests market apprehension regarding these forward-looking challenges.

Key Decisions for Investors

• Investors should closely monitor Ford's updated Q4 outlook and 2025 guidance for specific details on supply chain recovery and tariff mitigation strategies.
• Evaluate the sustainability of Ford's free cash flow and capital expenditure projections in light of the lowered EBIT forecast and potential operational headwinds.
• Consider Ford's relative performance against peers, particularly General Motors, in managing tariff impacts and supply chain disruptions, which could indicate differing operational efficiencies.