Ford Motor Co. on Wednesday, Oct. 28 increased the bottom-end of its annual financial guidance as it reported a $2 billion net income in the third quarter of 2026, a decrease of 17% year-over-year.

The Dearborn, Michigan, automaker is forecasting annual operating income of $10.5 billion to $11 billion, up from $10 billion to $11 billion and the $6.8 billion earned in 2025. Adjusted operating income in the third quarter was $2.7 billion, up 4% year-over-year, on strong product mixes and cost-reduction efforts, despite supplier disruptions and rising commodity costs.

"Q3 shows how a leaner, more fit industrial system and focused portfolio can grow profits amid rising cost pressures, intensified competition and macroeconomic uncertainty," Chief Financial Officer Sherry House said during an earnings briefing. "Our focus now is to make this progress repeatable and translate it into sustained earnings, cash flow and returns."

Ford recorded $49.5 billion in revenue in the third quarter, down 2% from the discontinuation of low-margin vehicles in North America and Europe like the Escape crossover, conflicts in the Middle East and increased material costs, namely steel and copper. Ford's adjusted earnings per share came in at 49 cents, up 9%. Ford beat average analyst expectations of $45.8 billion in revenue and 40-cent earnings per share.

Ford's adjusted operating income margin was 5.4%, up from 5.1% with a target of 8% by 2029. Its guidance assumes commodity headwinds approaching $2.5 billion year-over-year and $1 billion in material and warranty cost reductions, excluding tariffs and expenses related to an aluminum shortage after multiple fires at supplier Novelis Inc. last fall. With plants back to full run rates, the automaker is on track for a $1 billion tailwind compared to last year.

House also said 2027 is expected to look similar in profits to 2026. She predicted increased commodity costs, despite some relief on aluminum tariffs with Novelis back to full production, particularly from memory chip shortages induced by the artificial intelligence boom and increased logistic costs from higher fuel prices. Plus, Oakville Assembly Plant should be producing Super Dutys, though F-150 production is slated for downtime next year for a new generation.

Additionally, the automaker will be launching its stationary energy storage business, Ford Energy, later in 2027. It'll also be making investments for more products built off its Universal Electric Vehicle platform and more EVs in Europe, House said.

Ford Blue, the company's internal combustion engine and hybrid vehicle business, posted operating income down 10% to $1.392 billion. Its 5.1% operating margin decreased from 5.5% a year ago. Annual earnings guidance is expected to be about $5.5 billion compared to the previously shared $5 billion to $5.5 billion.

"Super Duty demand and orders have been resilient," House said, though acknowledged some softening on the retail side amid high fuel costs.

Ford Pro, the commercial vehicle business, reported $1.665 billion in operating income, down 16% year-over-year from Super Duty launch costs in Canada and higher commodity prices, and a 9.4% operating margin compared to 11.4% a year ago. Annual earnings are expected to fall at the low end of the previously estimated $7 billion to $7.5 billion guidance.

The loss posted by Ford Model e, the business unit dedicated to electric vehicles, was $1.058 billion compared to $1.41 billion in the third quarter of 2025. Revenue from the division fell 31% to $1.2 billion. Ford has said it expects Model e to post profits by 2029 and is set to improve first-generation EV operating profit by around 40%. It expects the loss for the division in 2026 will come in at the low end of its previously stated $4 billion to $4.5 billion guidance.

The automaker also had a record revenue quarter for software and parts sales, House added, underscoring growth expected in software products in 2027 as crosstown rival General Motors Co. this week announced it was switching to the Nasdaq from the New York Stock Exchange.

"At this time," House said, "we don't have any plans to make any such changes at Ford."

The company also is on track to launch in 2027 the first vehicle — a midsize truck starting at $30,000 called the Fathom — off its next-generation Universal Electric Vehicle Platform. The automaker this week announced that the vehicle that will be assembled at Louisville Assembly Plant in Kentucky will be able to power a home without the need for a separate inverter, giving consumers access to bidirectional power at a more affordable cost.

Ford also said it has manufactured more than 5,000 large aluminum unicastings at Shelbyville Technical Center in Kentucky ahead of Fathom's launch as its refines the manufacturing process and tests prototypes. Each Fathom will have a front and rear unicasting that simplifies assembly of the truck from 146 structural parts.

Adjusted free cash flow for the third quarter was $4.7 billion, and Ford predicts the measure still will range from $6 billion to $7 billion for 2026. Capital expenditures also are expected to fall between $9.5 billion and $10.5 billion.

Ford will pay a 15-cent regular dividend on Dec. 1 to shareholders of record on Nov. 10.

GM last week said it was on-track for a record annual adjusted operating profit after recording $3.35 billion in net income in the third quarter. Stellantis NV on Wednesday posted a net loss of more than $500 million from special charges in the period.

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