Car giant, FORD, takes an $800 million tariff hit but earnings still beat Wall Street expectations

Wednesday, July 30, 2025 - Ford Motor’s second-quarter earnings beat analysts’ expectations, but not without a significant hit from tariff-related costs.

The car manufacturer reported earnings per share of $0.27 cents and revenue of $50.2 billion after the market closed Wednesday. Earnings fell 10 cents from last year while revenue rose 5%.

Ford reported a net loss of $36 million, citing costs associated with a field service action and the cancellation of an electric vehicle program. Its adjusted earnings before interest and taxes were $2.1 billion, which Ford said included $800 million of "adverse net tariff-related impacts."

FactSet said that Wall Street estimated earnings per share of $0.33 and sales of $45.8 billion, according to Barron’s.

Ford’s stock closed at $10.91 and continued to dip in after-hours trading after opening at $11.13. It's been up about 5% since the presidential election last year. Analysts polled by FactSet gave Ford a mean price target of $10.31.

The company also reinstated its full-year guidance for 2025, with an adjusted EBIT of $6.5 billion to $7.5 billion, adjusted free cash flow of $3.5 billion to $4.5 billion, and capital spending of approximately $9 billion, plus a "net tariff-related headwind" of around $2 billion. In May, Ford had pulled its guidance for the rest of the year due to uncertain tariff impacts.

CFO Sherry House said during the company’s earnings call that Ford’s liquidity is “historically strong,” which can help the company keep investing through an economic downturn — like tariffs.

Ford said its new guidance "reflects the strong underlying first half performance across Ford Blue, Ford Model e, Ford Pro and Ford Credit, and continued improvement in cost."

Ford announced a regular dividend of $0.15 per share in the third quarter for payment on September 2.

While Ford Pro generated $2.3 billion and Ford Blue earned $661 million in EBIT, Ford Model e reported an EBIT loss of $1.3 billion, representing a $179 million increase in loss compared to the same period last year. The company said tariffs, EV investments, and the addition of a new battery plant contributed to Ford Model e's results.

Ford Credit reported $645 million in earnings before taxes, an 88% increase from last year.

"Our balance sheet keeps getting stronger, further enabling our ability to invest in areas of strength," House said in a release. "We are remaking Ford into a higher-growth, higher-margin and more durable business – and allocating capital where we can compete, win and grow.”

In April, President Donald Trump placed 25% tariffs on imported vehicles. Since then, some countries like Japan have negotiated lower tariffs. But tariffs on certain auto parts from Mexico and Canada could face rates higher than the baseline 25% rate. Additionally, imported steel and aluminum are subject to a tariff rate of 50%. 

Ford assembles its vehicles in locations all over the world, but primarily manufactures its cars in the U.S. and some in China.  

In response to the 25% tariffs, Ford offered employee pricing for customers on certain vehicles through July 4. This deal contributed to a sales increase in May. 

At the same time, Ford raised prices in May on some vehicles made in Mexico by $2,000, a Reuters report found, in part due to Trump’s auto tariffs. The price hike began impacting models sold at dealerships starting in late June. House had previously said Ford expects to increase prices for its U.S. vehicles by as much as 1.5% in the latter half of this year due to tariffs. 

Even with looming tariff concerns, Ford reported its second quarter sales earlier this month, marking its best quarterly sales numbers in six years. Sales rose 14.2%, largely thanks to an uptick in truck, hybrid, and SUV sales. However, its EV lineup disappointed, losing 31.4%. 

Ford’s declining EV sales come shortly after CEO Jim Farley said last month that China’s EVs are "far superior" to anything the West makes and threaten the very existence of U.S. automakers.

Earlier this month, The Wall Street Journal reported that Ford has issued the most or second-most recalls of any car company since 2020, cementing its place as the automaker with the most recalls in a single year.

And just two weeks ago, Ford was hit with another recall to some of its 2021-2024 Bronco Sport and 2020-2022 Escape models due to an issue with the fuel injector, according to the National Highway Traffic Safety Administration. The company said it estimated a fix would cost about $570 million and would “be reflected in our second quarter 2025 results," Reuters reported.