Ford Motor Co (F) Stock: First Quarter Earnings Beat Expectations Despite Tariff Challenges

TLDR

Ford reported Q1 EBIT of $1 billion, exceeding breakeven expectations Company anticipates $1.5 billion net adverse impact from tariffs in 2025 Ford suspended full-year guidance due to tariff uncertainty First-quarter US pickup sales were the best in over 20 years Ford assembly in US provides some protection from tariff impacts compared to competitors

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Ford Motor Company started 2025 with mixed results. Their first quarter showed better-than-expected earnings despite revenue declines and tariff challenges.

The company reported $41 billion in revenue for Q1 2025. This marks a 5% decrease from the same period last year.

Despite lower revenue, Ford delivered $1 billion in earnings before interest and taxes (EBIT). This significantly beat analyst expectations of breaking even for the quarter.

Net income fell by about two-thirds to $473 million (12 cents per share). This compares to $1.33 billion (33 cents per share) in the first quarter of 2024.

The results still topped the expectations of analysts. FactSet’s survey had forecast flat earnings per share for the quarter.

Ford Motor Company (F)

Tariff Challenges Ahead

Ford has withdrawn its full-year financial guidance due to uncertainty from evolving trade policies. The company originally forecast 2025 EBIT between $7 billion and $8.5 billion.

The automaker now expects a $2.5 billion gross adverse EBIT impact from tariffs in 2025. After mitigation efforts, the net impact is expected to be $1.5 billion.

This tariff impact is split between parts and imported vehicles. It also includes effects on steel and aluminum pricing.

Ford plans to offset about $1 billion of the tariff impact. They’ll use market equation optimization and cost mitigation strategies.

CEO Jim Farley highlighted Ford’s advantage of having more US production. “Automakers with the largest US footprint will have a big advantage, and, boy, that is that true for Ford. It puts us in the pole position,” Farley stated.

Bright Spots Amid Challenges

Ford achieved its best first-quarter US pickup sales in over 20 years. This shows strong demand for their core products.

The company is also on track to deliver $1 billion in net cost reductions this year. This excludes the impact of tariff policy changes.

Ford Pro continues to perform well. It holds over 40% share of the US Class 1 truck and van market.

Model e wholesale volumes more than doubled in the first quarter. US retail sales grew 15% during this period.

Ford and Lincoln were the most improved brands in J.D. Power’s 2025 US Vehicle Dependability Study. This highlights their progress in quality improvements.

The company declared a regular second-quarter dividend of $0.15 per share. As of March 31, Ford had over $27 billion in cash and more than $45 billion in liquidity.

Ford Credit reported earnings before taxes up significantly. It provided a $200 million distribution to the automotive company.

The tariff situation has created supply chain concerns. COO Kumar Galhotra noted specific challenges with rare earth materials from China: “It would take only a few parts to potentially cause some disruption into our production.”

Last week, President Donald Trump relaxed some of his 25% tariffs on automobiles and auto parts. This was described as giving automakers more time to transition manufacturing operations.

Ford expects to be less affected by tariffs than some competitors. Both Ford and Tesla assemble more of their cars in the US compared to GM and other automakers.

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