Ford Earnings Were Messy. The Stock Is Rising.

Coming into Wednesday trading, Ford stock was up about 5% since the Nov. 5 presidential election. That’s better than the performance of either GM or Stellantis shares. (Brandon Bell/Getty Images)

Ford Motor delivered impressive second-quarter results that were partially spoiled by a bevy of special charges related to electric vehicles and quality. Tariff news wasn’t great either.

That sums up what it has been like for the auto investors in 2025: a little frustrating and hard to follow.

Wednesday evening, the Dearborn, Michigan-based auto maker reported adjusted second-quarter operating profit of $2.1 billion and earnings per share of 37 cents from sales of $50.2 billion. Wall Street was looking for an operating profit of $1.9 billion and earnings per share of 33 cents on sales of $45.8 billion, according to FactSet. A year ago, in the second quarter of 2024, Ford reported operating profit of $2.8 billion and earnings per share of 47 cents on sales of $47.8 billion.

Ford stock has risen 2% to $11.08 after falling in late trading Wednesday, while the S&P 500 has risen 0.6% and the Dow Jones Industrial Average gad advanced 0.2%.

Sales were a record for the company. And operating profit beat Wall Street despite $800 million in tariff headwinds. Excluded from the adjusted operating profit, however, were some $1.3 billion in one-time charges, including about $600 million for a fuel-injector recall and $500 million related to EVs.

The charges aren’t great news, but Ford reinstated its full-year financial guidance after suspending it in May. The company expects a 2025 operating profit of between $6.5 billion and $7.5 billion. At the start of 2025, the forecast was for an operating profit of $7 billion to $8.5 billion, down from $10.2 billion in 2024.

The new guidance is lower, but implies second-half operating profits of about $3.8 billion. Wall Street currently projects about $3.7 billion for the second half of 2025.

Tariff headwinds, net of Ford’s cost reductions, were raised to about $2 billion for 2025, up from prior guidance of about $1.5 billion. The increase might surprise investors because Ford is in a better position to deal with import tariffs than many of its peers.

About 80% of the cars Ford sells in the U.S. are made domestically. That ratio for GM and Stellantis is about 55%. Overall, the U.S. imported about 50% of new car demand in 2024, mainly from Mexico, South Korea, and Japan.

Ford CFO Sherry House pointed out that new tariffs hit Ford’s financial forecasts. U.S. steel tariffs were raised from 25% to 50% during the second quarter. Ford management also pointed out that the company didn’t believe that 15% tariff rates, recently implemented for Japan and the European Union, create a significant incentive to move manufacturing back to the U.S.

Ford’s EV business is getting better. It lost $1.3 billion in the second quarter, with sales up 128% year over year. The per-car loss—operating profit divided by unit sales—fell to roughly $22,000 per car from $44,000 a year ago.

Ford’s traditional car business earned an operating profit of $661 million for a profit margin of 2.6%, down from 4.4% a year ago. Ford’s commercial division, Ford Pro, continued to be the company’s standout business, earning an operating profit of $2.3 billion. Margins, however, fell to 12.3% from 15.1% in the second quarter of 2024.

Strong sales helped Ford’s inventory position. The company sold about 612,000 vehicles in the U.S. in the second quarter, up 14.2% year over year. Dealer inventories ended the quarter at about 101 days of sales, according to data provider Cox Automotive. That’s an improvement from 113 days at the end of 2024. The industry average is about 75 days.

Ford sells cars to dealers, and dealers sell to consumers. Lower numbers are better. When inventories get too high, dealers don’t need to replenish stocks. Higher dealer inventories was an issue for Ford at the start of 2025.

Coming into Wednesday trading, Ford stock was up about 5% since the Nov. 5 presidential election. General Motors and Stellantis shares were down about 3% and 30%, respectively.

Options markets imply Ford stock will move about 6% up or down following earnings. Shares have moved an average of about 9% over the past four quarterly reports. Shares have fallen three times and risen once over that span.

It might take a while for investors to figure out exactly how they feel about the quarter.

Write to Al Root at allen.root@dowjones.com