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    Earnings call· Jun 2026(Q2 FY26)

    FORD MOTOR Q2 FY26 earnings call F

    Jul 28, 2026 Source

    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

    6

    • 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

    4

    • 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

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

    Segment performance

    4
    SegmentRevenueYoYQoQMargin
    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 billion1%—$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 billiondeclining—-$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

    Operational metrics

    29
    Adjusted EBIT
    $2.5 billionup 17% YoY
    Q2 FY26

    Strong performance in a complex environment.

    Cash Balance
    $22.3 billion
    end of Q2 FY26

    Strong balance sheet.

    Total Liquidity
    $43.4 billion
    end of Q2 FY26

    Strong balance sheet.

    Capital Returned
    More than $16 billion
    last 5 years

    Committed to returning capital to shareholders.

    Q3 Regular Dividend
    $0.15
    Q3 FY26

    Announced regular dividend.

    Special Item Charge
    $3.6 billion
    Q2 FY26

    Recognized in the quarter, contributing to net loss.

    Remaining Cash Charges
    up to $2 billion
    FY26

    Expected to be completed by year-end.

    Novelis Related Temporary Costs
    $800 million
    YTD

    Incurred year-to-date due to aluminum supply recovery plan.

    Novelis Full Year Cost Impact
    $1.5 billion
    FY26

    Expected full-year cost impact, lower than originally thought.

    U.S. Inventory
    52 retail days supplyslightly below target of 55 to 65 days
    Q2 FY26

    Expected to return to targeted levels as recovery progresses.

    F-Series Days Supply
    45 daysvery lean
    Q2 FY26

    Indicates significant upside on the wholesale side.

    Total Paid Subscriptions
    1.6 millionup about 50%
    Q2 FY26

    Includes Ford Pro Intelligence and retail subscriptions.

    Ford Pro Intelligence Paid Subscriptions
    900,000up over 20% YoY
    Q2 FY26

    Customers actively choosing to pay for these services.

    Remote Services Delivered
    1.5 million
    Q2 FY26

    Customers love mobile service, leading to higher loyalty.

    BlueCruise Contribution to Retail Integrated Services Revenue
    50%
    Q2 FY26

    Significant contribution from BlueCruise.

    BlueCruise Paid Subscriptions Growth
    20%
    Q2 FY26

    Continued revenue growth for BlueCruise.

    BlueCruise Hours Used
    12.1 million+
    since launch

    Dimension of BlueCruise scale.

    BlueCruise Miles
    840 million
    since launch

    Approaching 1 billion miles.

    Number of Recalls
    down about 40%YoY
    this year

    Reflects intensive strategy to quickly find and fix issues.

    Vehicles Recalled
    12 million
    this year

    Total vehicles recalled this year.

    Off-road enthusiast vehicles as % of U.S. sales
    25%
    Q2 FY26

    Growing segment, bringing new customers to Ford.

    Off-road mix growth
    over 4 pointsYoY
    Q2 FY26

    Strong growth in off-road segment.

    Tremor as % of Expedition sales
    15%
    Q2 FY26

    Strong series mix.

    Raptor sales growth
    9%
    YTD

    Strong growth across the portfolio.

    Oakville additional Super Duty capacity
    up to 100,000 units
    Q4 FY26

    Investment to increase manufacturing flexibility and meet demand.

    UEV starting price
    around $30,000
    next year

    First UEV product to compete in the affordable heart of the U.S. EV market.

    Connected vehicles
    over 14 million
    Q2 FY26

    Enormous base to grow from for software and services.

    Mobile service vans and trucks
    over 5,000
    Q2 FY26

    Expanding mobile fleet for physical services.

    CPO unit sales growth
    over 20%
    YTD

    Positioning Ford as the #2 CPO brand in the market.

    Industry KPIs

    7
    MetricValueDetails
    Order book backlogahead of last yearstatus
    Warranty recall costsdown about 40%%
    Autonomous robotaxi metrics1.6 millionsubscriptions
    Vehicle deliveries wholesalesdown 8%%
    Dealer inventory days of supply52 retail days supplydays
    Energy storage battery capacity20 gigawatt hoursGWh
    Ev unit volumes mix segment economics-$919 millionEBIT loss

    Product announcements

    3
    ProductTypeDetails
    UEV Platformlaunch
    Ford Energylaunch
    Oakville Expansionexpansion

    Deals & partnerships

    4
    GeelyAgreement to bring speed and capital efficiency to European operations.

    Announced last week, focused on European operations.

    EDF Power Solutions North AmericaAgreement 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 governmentContract 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.

    AppleApple 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

    6
    Novelis aluminum supply disruptionFY26

    $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 environmentOngoing

    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 headwindsFY26

    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 EnergyH2 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 productsFY27

    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 benefitFY27

    $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

    5

    U.S. Inventory Levels

    next quarter
    Current52 retail days supply
    Target55 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.

    Q&A highlights

    8

    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 read6 chapters

    Detailed Narrative

    01

    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.

    02

    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.

    03

    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.

    04

    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.

    05

    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.

    06

    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.

    AI-generated summary of the company’s earnings call. Not investment advice.