Ford cites SUV demand as it lifts profit outlook

A 2025 Ford Bronco Badlands SUV. (Graham Hughes/Bloomberg)

Ford Motor Co. posted earnings ahead of Wall Street estimates and raised its outlook for the second time this year on higher prices and strong sales of high-margin sport-utility vehicles.

Adjusted earnings were 42 cents a share, topping the 36-cent average of analyst estimates compiled by Bloomberg. Ford now expects to earn as much as $11 billion before interest and taxes this year, up from its prior forecast for $8.5 billion to $10.5 billion, the company said in a July 28 statement. Analysts had expected about $9.5 billion on average.

The rosier outlook shows how Ford is cashing in on resilient demand for SUVs and pickups, echoing a similar move by rival General Motors Co. last week. Those models generate critical profit for Ford as the company scales back its loss-making electric vehicle operations and digests higher costs from tariffs and commodities.

It’s also a sign of momentum as the company invests $2 billion into a new energy storage business that could take years to generate returns.

CEO Jim Farley said in a statement that the results reflect “growing evidence that Ford is becoming a more profitable, more disciplined and genuinely different company.”

Ford’s shares rose 7.2% in after-hours trading in New York. The stock gained 14% this year through the close of July 28, better than the broader S&P 500 Index.

The automaker softened the blow of a 10% drop in U.S. vehicle sales in the second quarter by delivering large numbers of profitable Bronco and Explorer SUVs, particularly high-margin models outfitted with expensive off-road performance packages. 

That helped offset the profit hit of having fewer of its top-selling F-Series pickups on hand due to fires last year at the Novelis Inc. aluminum mill in New York state that provides material for the truck’s body panels. The mill resumed operations in the second quarter, and Ford expects to recoup some lost production in the back half of the year.

The company now expects to recover about $2.5 billion worth of F-Series production lost to the fires, the low end of its previous forecast for as much as $3 billion, according to an investor presentation.

Chief Financial Officer Sherry House said much of the more than $1 billion in tariff costs Ford expects this year comes from importing aluminum because of the Novelis fires.

“We have a very sizable tariff cost due to the Novelis supply disruption and our need to be able to secure aluminum from outside the United States,” House said in a call with reporters July 28. “Our tariff costs now are largely focused on aluminum and steel and incoming vehicles.”

Ford also has benefited from its foray into energy storage, which sent its shares soaring the most in 17 years in May as investors tied the old-economy automaker to the artificial intelligence spending boom. 

“We have many potential customers that are reaching out to us” from sectors including power generation and data centers, House said. Profit from the new energy business won’t show up in financial results until 2028, she said.

The move into the battery business came from Ford’s setback in attempting to sell electric vehicles, as it repurposes an EV battery plant in Kentucky to build batteries for energy storage.

That facility was part of Ford’s now-defunct joint venture with South Korea’s SK On to build EV batteries. Ford booked a $3.6 billion largely noncash charge in the second quarter related to the previously disclosed wind-down.

EV reckoning

Ford’s EV sales plunged 41% in the second quarter, after discontinuing its F-150 Lightning plug-in pickup as part of $19.5 billion in charges on underperforming EV assets. Ford is overhauling its EV strategy to focus on less expensive models, starting with a $30,000 small electric pickup truck due to launch later next year.

Farley has promised several affordable electric models to be built on what the company calls its universal electric vehicle platform, which are to be produced at a former SUV factory in Kentucky. He has said those models are critical to fending off competition from Chinese automakers that are gaining ground worldwide with cheap, high-tech EVs but are kept out of the U.S. by formidable trade barriers. Farley himself has said having Chinese cars in the U.S. would be "devastating."

RELATED: Ford CEO Farley says Chinese cars in U.S. would be devastating

On the other hand, Farley has also praised Chinese automakers’ cost and technological advantages, saying they represent an existential threat to western car companies. 

Last week, Ford announced a joint venture with China’s Geely Automobile Holdings to co-develop electric SUVs for Europe and to share production at a Ford factory in Spain. Ford also has a licensing agreement with Chinese battery giant Contemporary Amperex Technology Co. to build batteries for both EVs and energy storage.