Inquired about the key drivers of strong trim mix, particularly off-road performance trims and V8 series, and the expected continuation of this benefit.

Andrew Frick attributed the strong mix to brand positioning and regulatory changes aligning with customer demand. He highlighted record sales for the Bronco family, off-road mix growing over 4 points YoY in Q2, Tremor making up 15% of Expedition sales, and Raptor sales up 9% YTD. He expects this product and series mix to continue through the balance of the year. “We've seen growth in our portfolio mix, our product portfolio mix and large utilities and the Bronco family. In fact, Bronco family had our best first half sales ever.”

Asked about the F-Series outlook for the back half, given the guidance factors in lower volume recovery despite Novelis ramp-up, and if competitive dynamics are influencing this.

Jim Farley noted F-Series has a lean 45-day supply, indicating significant wholesale upside. Andrew Frick added that overall truck demand is strong, and F-Series leads in go-to-market metrics with lower incentives, higher share, and strong turn rates. Sherry House clarified that the lower volume recovery in guidance is due to mix changes, with the overall $1 billion EBIT improvement still expected, and Novelis costs tracking at the lower end of prior estimates. “F-Series is around 45-day supply, which for us, is very lean. So we have a lot of upside on the wholesale side, not just from retail side.”

Inquired about Ford's ability to mitigate tariffs, and Jim Farley's thoughts on USMCA discussions and potential impacts of increased U.S.-specific content requirements.

Jim Farley stated that an improved USMCA could be a great opportunity for Ford and the industry, aiming to level the playing field against foreign competitors with strong supply chains and weaker currencies. Ford is engaging with U.S., Mexico, and Canada administrations, focusing on promoting a more competitive U.S. auto sector. He noted Ford has managed its tariff exposure well, working with the administration. “We are prepared to support revising the USMCA so long as it allows the promotion of more competitive U.S. auto sector.”

Ford Motor Company (F) Q2 FY26 earnings call: guidance and Q&A

Earnings call· Jun 2026 (Q2 FY26)· Consumer Discretionary· Jul 28, 2026

Source: earnings call transcript

Executive summary

Ford Motor Company Q2 FY26 — Strong EBIT Growth and Raised Full-Year Outlook

Ford delivered strong Q2 FY26 results, demonstrating resilience and strategic execution despite macroeconomic complexities and supply chain disruptions. The company raised its full-year EBIT and free cash flow guidance, driven by strong pricing, mix, and ongoing cost discipline. Ford is advancing its Ford+ plan, focusing on profitable core automotive operations, scaling high-margin software and physical services, and building new adjacent businesses like Ford Energy, while navigating significant investments in EV and new product launches.

Highlights

Adjusted EBIT increased by 17% year-over-year to $2.5 billion.
Full-year adjusted EBIT guidance raised by $1 billion at the midpoint to between $10 billion and $11 billion.
Generated $2.1 billion in company adjusted free cash flow.
Ford finished #1 among All Mainstream Brands in J.D. Power's 2026 Initial Quality Study.
Ford Blue EBIT grew 72% to $1.1 billion, driven by strong mix and net pricing.
Total paid subscriptions grew about 50% to roughly 1.6 million.

Concerns

Reported a net loss of $1.3 billion due to a one-time special item charge of $3.6 billion related to the BlueOval SK Battery Joint Venture disposition.
Revenue decreased 4% year-over-year to $48.3 billion, impacted by expected volume reductions from Novelis aluminum supply and vehicle sunsetting.
Full-year cost impact from the Novelis disruption is now expected to be about $1.5 billion.
Model e reported an EBIT loss of $919 million, despite a 31% year-over-year improvement.

Guidance & targets

Category	Target	Timeline	Confidence
Full-year adjusted EBIT	$10 billion to $11 billion high materiality	FY26	High
Full-year adjusted free cash flow	$6 billion to $7 billion high materiality	FY26	High
Full-year capital expenditures	$9.5 billion to $10.5 billion medium materiality	FY26	High
Full-year Ford Blue EBIT	$5 billion to $5.5 billion medium materiality	FY26	High
Full-year Ford Pro EBIT	$7 billion to $7.5 billion medium materiality	FY26	High
Full-year Model e losses	about $4 billion medium materiality	FY26	High
Full-year Ford Credit EBT	above $2.5 billion medium materiality	FY26	High
Full-year U.S. SAAR assumption	16 million to 16.5 million units medium materiality	FY26	High
Full-year commodity headwinds	just above $2 billion medium materiality	FY26	High
Full-year material and warranty cost reductions	$1 billion medium materiality	FY26	High
Full-year U.S. industry pricing	plus 50 basis points medium materiality	FY26	High
Ford Energy annual capacity	20 gigawatt hours medium materiality	late 2027 · FY27	High
Model e Gen 1 EBIT improvement	approximately 40% medium materiality	2026 · FY26	High
Oakville Super Duty capacity	up to 100,000 units additional medium materiality	Q4 · FY26	High
UEV product customer deliveries	begin next year high materiality	next year · FY27	High
8% EBIT margin target	8% EBIT margin high materiality	2029 · FY29	High

Segment performance

Segment	Revenue	YoY	QoQ	Margin
Ford Blue Revenue and EBIT strength driven by favorable product mix enabled by U.S. regulatory changes and higher net pricing, more than offsetting wholesale decline. EBIT growth YoY: 72%Wholesales decline: 8%Record sales for Bronco family in Q2Explorer and Expedition retail sales up 22% in Q2Off-road enthusiast vehicles: 25% of U.S. sales in Q2Off-road mix grew over 4 points YoY in Q2Tremor: 15% of Expedition salesRaptor sales up 9% YTDHighest retail shareLowest incentive spendHighest share of revenue with sales focused through most profitable channels	$26.1 billion	1%	—	$1.1 billion EBIT
Ford Pro Solid quarter despite significant headwinds, primarily due to temporary Novelis disruption. Growth in software and physical services highlights ecosystem durability. EBIT decline YoY: 26%Ford Pro Intelligence paid subscriptions: over 900,000Ford Pro Intelligence paid subscriptions growth YoY: over 20%2027 model year customer contracting in North America: off to a fast start, about a month ahead of last year	$17.8 billion	-5%	—	$1.7 billion EBIT
Model e Progress driven by structural cost reductions, rightsized Gen 1 volumes, and lower U.S. incentives following regulatory relaxation. Prioritizing profitability and capital efficiency on path to breakeven. EBIT improvement YoY: 31%Third consecutive quarter of year-over-year EBIT improvement	$1 billion	declining	—	-$919 million EBIT loss
Ford Credit Solid quarter reflecting strong financing margin, high-quality portfolio, and disciplined capital/risk management. Executing multiyear certified preowned enterprise strategy. EBT increase YoY: $112 millionU.S. CPO unit sales growth YTD: over 20%CPO brand ranking in market: #2	—	—	—	$757 million EBT

F operating KPIs by quarter

F operating KPIs stated on its earnings calls, by fiscal quarter
KPI	Mar 2025 Q1 FY25	Sep 2025 Q3 FY25	Mar 2026 Q1 FY26	This call Jun 2026 Q2 FY26	Change vs prior quarter
Paid subscription members Ford Pro	675K On the software side, Pro's paid subscriptions, which deliver better than 50% gross margin rose to 675,000, up 20% from a year ago. Source: earnings call transcript	818K In software, Pro's paid subscriptions grew 8% to 818,000 subscribers, and we're also seeing growth in our ARPU and attach rates. Source: earnings call transcript	879K In fact, paid software subscriptions grew to 879,000, a 30% year-over-year increase. Source: earnings call transcript	900K+ Total paid subscriptions grew about 50% to roughly 1.6 million, including more than 900,000 Ford Pro Intelligence paid subscriptions. Source: earnings call transcript	—

Operating figures the company stated on at least two of the calls shown, checked against each call's transcript. Click a figure to read the sentence. A dash means it was not stated that quarter.

Product announcements

Product	Type	Timeline
UEV Platform	launch	Customer deliveries begin next year (2027)
Ford Energy	launch	20 gigawatt hours annual capacity by late next year (2027)
Oakville Expansion	expansion	Launch in the fourth quarter of this year (Q4 FY26)

Deals & partnerships

Geely Agreement to bring speed and capital efficiency to European operations.

Announced last week, focused on European operations.

EDF Power Solutions North America Agreement to serve a broad and enduring customer base for Ford Energy.

A step to integrate Ford Energy further into the energy ecosystem.

U.S. federal government Contract to produce 3 prototypes based on the Super Duty for military use.

Ford always answers the call to duty, aiming to offer the U.S. government the same advantages commercial customers get.

Apple Apple will be the embedded map provider for every UEV platform vehicle.

Integration of Apple Maps into the UEV platform for a great integrated solution for customers.

Risks & headwinds

Novelis aluminum supply disruption FY26

$1.5 billion full-year cost impact; revenue down 4% YoY due to volume reductions

Mitigation:Hot mill restart on track, contingency material secured, U.S. inventory expected to return to targeted levels (55-65 days supply).

Complex macroeconomic and industry environment Ongoing

Not quantified in guidance

Mitigation:Guidance does not include potential impacts of a significant escalation in the Middle East or a material downturn in the U.S. economy.

Commodity headwinds FY26

Just above $2 billion for FY26

Mitigation:Planning for 4 quarters of impact in 2027 versus 3 quarters in 2026; any softening would be a tailwind.

Accelerated investments in UEV and Ford Energy H2 FY26

$1 billion incremental investment in Model e losses

Mitigation:These investments are enabling future growth and profitability, funded by cost reductions in other areas.

Launch costs for new products FY27

Not quantified for 2027, but expected to be significant

Mitigation:Associated with Ford Energy and UEV launches, and preparing for an all-new U.S. truck lineup.

Non-repeat of IEEPA tariff EBIT benefit FY27

$1.3 billion booked in Q1 FY26

Mitigation:This one-time benefit will not repeat in 2027, creating a headwind for year-over-year comparisons.

What to watch in Q3 FY26

U.S. Inventory Levels

next quarter

Current 52 retail days supply

Target 55 to 65 days supply

Why it matters

Indicates the effectiveness of the Novelis recovery plan and the ability to meet demand, impacting wholesale volumes and sales.

U.S. inventory of 52 retail days supply is slightly below our target of 55 to 65 days, and we expect to return to targeted levels as the recovery progresses.

Find out whether F delivers this. Inve re-checks your case every morning.

Q&A highlights

Asked about conversations with hyperscalers for direct offtake of battery capacity and the progress in securing incremental contracts for Ford Energy.

Jim Farley stated that the demand signal for Ford Energy's 20-foot containerized LFP prismatic DC block solution is very strong, with broad customer interest beyond just utility providers. He indicated they are in the 'third inning' of selling out 2028 capacity of 20 GWh, and are building prototype cells in Marshall, Michigan, with Kentucky 1 following. Factors for additional capacity include tax treatment, strategic choices, and customer flows.

“I would say we're kind of in the third inning of selling out the 2028 capacity of 20 gigawatt hours.”

asked by Andrew Percoco · answered by James Farley

2 min read 6 chapters

Detailed narrative

Ford+ Plan Driving Transformation

Ford's Q2 FY26 results underscore the effectiveness of its Ford+ plan, focusing on three complementary areas: core auto operations, software and physical services, and adjacency businesses like Ford Energy. The company emphasizes becoming more profitable and disciplined, with every dollar invested expected to earn durable returns and drive profitable growth.

This strategic approach is intended to build competitive advantages and open new sources of profit for the company.

Quality Renaissance and Cost Structure Improvement

Ford achieved the #1 ranking among All Mainstream Brands in J.D. Power's 2026 Initial Quality Study, signaling a significant improvement in product quality. This quality renaissance is coupled with an intense drive to improve cost structure, having significantly reduced warranty and material costs since 2024.

Management expects these efforts to lead to lower recall costs, stronger customer loyalty, and improved pricing power, particularly as the company enters a heavy new product launch period.

Product Portfolio Strength and Hybrid Expansion

The company is reinforcing its strength in trucks, vans, personal utility vehicles, and off-roaders, which are delivering real pricing power. F-Series remains the #1 truck brand, on track for 50 consecutive years at the top, and off-road enthusiast vehicles now constitute 25% of U.S. sales in Q2.

Ford plans to extend its hybrid offerings across its entire lineup, building on the success of the F-150 hybrid and the Maverick hybrid, which achieved record sales in the first half.

Model e and Affordable EV Strategy

Model e is aggressively driving down Gen 1 costs and aims to become a major scaled competitor in affordable, versatile EVs. The Louisville plant changeover for the new UEV platform is underway, with customer deliveries expected to begin next year.

The first UEV product will target the affordable U.S. EV market, starting around $30,000, offering unique features like more cabin room than a Toyota RAV4, a pickup truck bed, and bidirectional charging capability, with Apple as the embedded map provider.

Ford Energy and Strategic Adjacencies

Ford Energy, launched earlier this year, is positioned as a strategic business with a short payback, leveraging Ford's manufacturing, battery technology, and service expertise. The company expects to reach 20 gigawatt hours of annual capacity by late next year, aiming to be among the leading energy storage manufacturers in North America.

Ford is also exploring other adjacencies, including a contract with the U.S. federal government to produce Super Duty-based prototypes for military use, emphasizing strong returns and capital efficiency for all new ventures.

Software and Physical Services Growth

Ford's software and physical services segment continues to grow, with over 14 million connected vehicles and total paid subscriptions increasing by 50% to approximately 1.6 million. This includes over 900,000 Ford Pro Intelligence paid subscriptions. The company is expanding its parts catalog and mobile service fleet, delivering 1.5 million remote services in Q2, which contributes to higher Net Promoter Scores and customer loyalty, and aims for these services to contribute significantly to future margins.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.