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Earnings

Natasha Piñon

cfobrew.com

Call it a tale of two cities. Okay, three. And instead of cities, it’s automakers.

Fine, you got us. We’re really just here to talk about auto earnings, as General Motors, Tesla, and Ford all reported the week of October 20, and “a tale of three automakers” is a lot less catchy than we’d like it to be.

Going into the earnings-heavy week, Morningstar analyst David Whiston, who covers GM, Ford, and other auto retailers, told CFO Brew that on top of “the general expectation” that the auto industry will start passing tariff costs on to consumers in 2026, there’s a lot of, you guessed it, 

“You’ve got the threat of possibly a slowing economy,” he noted. “There’s a lot of concerns about vehicle affordability. There’s concerns about loan delinquencies.”

But “despite all the volatility, all the economic news that has people spinning around, we’re still going to end up with a relatively decent, if not healthy, automotive market [from a] sales perspective by the end of the year,” Erin Keating, executive analyst for Cox Automotive, told us.

Looking ahead to 2026, adaptability and strategic clarity are the name of the game, she said: “Those that are able to navigate these geopolitical shifts and make decisions and stick to them strategically, even with some uncertainty…are going to be the ones that are going to be able to sustain themselves throughout next year and beyond.”

So let’s see how everyone’s doing, shall we?

In Q3 2025, General Motors seemed like someone a little too excited to go to their high school reunion: They’re not just doing fine or pretty good…they’re doing 

The company raised its 2025 fiscal guidance, and better yet, expects 2026 to outperform this year.

“Looking ahead to 2026, we have multiple levers to carry our current momentum forward, including progress on [electric vehicle] losses, warranty costs, tariff offsets, regulatory requirements and fixed costs,” CFO Paul Jacobson said during an earnings call October 21. “As a result, we expect next year to be even better than 2025.”

Of course, that’s the kind of thing investors love to hear. “Usually they won’t say anything about the upcoming year until they report fourth quarter results in January of that year,” Whiston noted. “The fact they’re willing to say that early is a good sign.”

The automaker also lowered its expected tariff impact this year, now anticipating costs of between $3.5 billion and $4.5 billion, down from the previously expected $4 billion to $5 billion.

“[GM] continue[s] to have inventory discipline and pricing strength that just really keeps them pumping along at good average transaction prices, balancing volume of profitability,” Keating said. “They obviously want to focus on the bigger, more profitable models that honestly sell best in the US, and I think that’s part of the reason they’re relatively positive on their outlook.”

Ford also had cost impacts to share. In September, a 

 a Novelis aluminum plant in Oswego, New York. That was bad news for Ford, which relied on the supplier for its vehicle production.

The automaker said it anticipates the fire will cost it between $1.5 billion and $2 billion, though it has plans to mitigate that; CEO Jim Farley said in the company’s earnings report that Ford is “working intensively with Novelis and others to source aluminum” that can be made in the operational section of the plant “while also working to restore overall plant production.”

In its October 23 earnings report, Ford now expects adjusted earnings before interest and taxes to come in between $6 billion and $6.5 billion, down from its previous forecast of $6.5 billion to $7 billion.

Over at Tesla, CEO Elon Musk is seeking a trillion-dollar 

 because, among other things, he wouldn’t feel comfortable building “a robot army” at Tesla if he were at risk of “being ousted.”

“I wish I could say the temper tantrum around the paycheck for Elon was out of the ordinary, but I fully expected him to bring that up on the call and to speak to his need to be involved with the company,” Keating said.

According to its October 22 earnings report, Tesla’s profit fell 37% YoY. Revenue climbed 12% to $28.1 billion, with Tesla selling more cars between July and September than in Q3 2024. Notably, though, the company offered significant discounts to boost sales, meaning Tesla earned less money per car on those sales.

Automakers offer a wide range of guidance in latest earning batch 

After last week’s big-name earnings reports, we got a better look at the state of the auto industry. 

Need a dollar amount? Tariffs are expected to hit FedEx with $1 billion in costs in fiscal 2026, executives said during the company’s Q1 2026 earnings call last week.

Export volumes decreased for the quarter, especially stalling between the US and China. The company reduced its “trans-Pacific Asia outbound capacity by 25% YoY,” CEO Raj Subramaniam said on an earnings call Thursday.

The bulk of FedEx’s troubles with that particular trade route came from the halting of the 

, which President Trump ended last month via executive order. It allowed duty-free shipments to the US on orders under $800.

“Given a significant portion of our de minimis volume exposure previously came from China, we were able to use learnings from our experiences in May to help shippers elsewhere navigate the more recent exemption elimination,” Subramaniam said on the call.

Now, the shipping giant is focusing its efforts on other markets, including shipping within the US.

“Knowing our strongest international lane would be under pressure, we pivoted the commercial team and they have done a tremendous job capturing demand out of Southeast Asia and Europe,” Brie Carere, FedEx’s chief customer officer, told investors on the earnings call.

US average daily volume climbed 5% in the quarter, while Subramaniam noted that “Q1 also marked our best new business quarter in Europe in the last 2 years.”

And it’s not like the company is exactly struggling. Revenue climbed to $22.2 billion, a 3% YoY jump. Analysts FactSet polled expected $21.7 billion in revenue, the 

 reported. The company anticipates YoY revenue growth within the 4% to 6% range for fiscal 2026, ahead of Wall Street expectations.

Some big hits, sure, but FedEx is doing fine.

FedEx halts package shipping from some retailers

FedEx hurt by tariffs in Q1, but sales and profit rose 

 While the company reported a steep tariff hit, it was buoyed by domestic shipping strength. 

There’s nothing better than a good matchup. George Foreman versus Muhammad Ali, milk versus cookies, Star Wars versus the other one that can’t be named.

And that’s exactly what appeared to be happening in the latest batch of earnings reports, which looked like battle royale for big box retailers, with key players facing their competitors. These closely watched reports each offered a look at how cash-strapped consumers are (and aren’t) spending in a darkening economic landscape.

In one corner, Home Depot. In the other, Lowe's. Both are watched for their proximity to the housing market and homebuilding, neither of which have been doing especially well lately. In August, homebuilder sentiment in the US 

 to its lowest level in over two-and-a-half years.

Home Depot seemed unfazed by the low morale in housing, sticking to its full-year outlook. In its latest earnings report, the company said it still expects full-year total sales to climb by 2.8%.

But is that confidence fully founded? This marks the second straight quarter of earnings misses for the home improvement retailer, and its Q2 2025 report was the first since May 2014 to miss on both earnings and revenue expectations, 

But you can see where the optimism is coming from, as the company waits for the tides of home improvement spending to tick up. On the company’s earnings call, CEO Ted Decker noted that “some relief on mortgage rates, in particular, could help.”

The biggest culprit holding consumers back from spending is the elephant in 

“The No. 1 reason for deferring the large [home improvement] project is general economic uncertainty,” he said. “That, you know, is larger than prices of projects, of labor availability, all the various things we’ve talked about in the past by a wide margin.”

And those deferred projects have caused Home Depot to change its course on tariff-induced price hikes, with McPhail telling the 

 now “there will be some modest price movement for some categories.”

Meanwhile, competitor Lowe’s was largely playing catchup. The company announced a $8.8 billion cash deal to purchase building materials maker Foundation Building Materials; this follows a Home Depot subsidiary’s purchase of a specialty building products distributor for $4.3 billion under 

Lowe’s reported $2.4 billion in net income, a 0.6% climb from the same time last year. Michael Baker, an analyst at financial services company D.A. Davidson, 

 that Lowe’s showcased plenty of positives in its latest report, especially when it comes to comparable sales growth. Lowe’s bested Home Depot in that category, which he said was the first time that has happened since Q3 2024.

 There was a more obvious winner in the showdown between Target and Walmart.

. Its longtime CEO Brian Cornell is stepping down, a widely anticipated move that analysts thought could usher in a fresh, outside voice to the struggling company. Instead, Cornell 

 in February 2026 by the company’s COO Michael Fiddelke, who’s been with the company for 20 years.

In its latest earnings report, Target posted sales that marked a 

. This year, Target’s stock has ranked among the worst performing companies on the S&P 500, 

With that backdrop, everything that competitor Walmart had to offer looked positively rosy. So, even as the big box retailer missed on quarterly earnings for the first time since May 2022, 

The company raised its full-year earnings and sales outlooks. On an earnings call, CEO Doug McMillon noted that while lower- and middle-income consumers have turned to cheaper alternatives, the company hasn’t encountered an across-the-board pullback on consumer spending because of tariffs, which have pushed up Walmart’s costs every week.

Even in the best matchups, it’s not always a fair fight.

Big box retailers duked it out in earnings reports last week  

These closely watched reports offered a look at how cash-strapped consumers are (and aren’t) spending in a darkening economic landscape. 

Courtney Vien

Spirit Airlines may soon find itself grounded.

’ about its ability to continue as a going concern over the next year,” according to the Associated Press. In securities filings, it stated that it’s having difficulty meeting its credit card processors’ 

Spirit, which flies to destinations in the US, the Caribbean, and Central and South America, mentioned “adverse market conditions” as one reason for its struggles. Demand for domestic flights is down, it said, and it expects that trend to continue through the end of this year. Consumers appear to be 

 on travel spending this summer due to concerns about tariffs and the economy, and lower- and middle-income travelers may opt to drive rather than fly.

, at least in some income brackets. Delta had a record second quarter, driven by a 5% rise in sales for premium seats, though sales of main cabin seats fell by 5%. It revised its third-quarter EPS guidance downward.

Spirit has had years of financial struggles. It failed to capitalize on the post-pandemic travel boom and lost more than $2.5 billion between 2020 and 2024, per the AP. In 2024, it cut its domestic flights by 20%, and started charging for snacks, drinks, and wi-fi. Despite those measures, it 

The airline emerged from bankruptcy protection in March 2025, having restructured its debt and secured new funding. To free up cash, it said, it plans to furlough around 270 pilots and demote around 140 others, and it will sell or monetize some aircraft and real estate.

If Spirit does go under, look for other airlines to pounce on it. Its fleet is newer, making it an “attractive takeover target,” the AP reported. Frontier and JetBlue have tried unsuccessfully to acquire Spirit in the past.

Spirit Airlines doubts it can continue as a going concern

Decreased travel demand and increased competition are sinking the budget carrier.

Jesse Klein

You probably won’t see Elon posting about this news much.

Tesla’s total revenue fell for the second straight quarter, coming in at $22.5 billion, slightly less than the $22.6 billion–$22.7 billion analysts forecast. This represents a 12% YoY revenue drop, down from $25.5 billion a year ago.

. At the beginning of the year, the company seemed 

 the benefits of President Trump’s favor as Musk palled around with the president as head of the “Department of Government Efficiency.”

But the happy days didn’t last long—Trump and Musk fell out 

 soured on Musk’s involvement with Trump. Now the blowback is showing up in Tesla’s balance sheet; deliveries fell 13% YoY. And there are more sales challenges on the horizon: Trump’s “One Big Beautiful Bill” cuts the 

 for electric vehicles at the end of September, making the company’s vehicles more expensive to buy.

On the earnings call, Musk pointed to the 

 as a factor that could hurt future Tesla sales, warning that the company “probably could have a few rough quarters.”

Even with the incentive to buy an EV before September 30, Tesla’s vehicle deliveries dropped in the second quarter as 

looked to other, more affordable (or less controversial) brands.

CFO Vaibhav Taneja signaled Tesla would increase production of its more affordable model for the post-EV credit era. Tesla has been flirting with a 

 for years, and started production in June. The company is also looking into other delayed projects like the Tesla Semi and its Cybercab robotaxi, which has started a 

As for Musk’s frenemy, Trump posted on Truth Social that he isn’t 

 and that he wants “Elon, and all businesses within our Country, to thrive, in fact, THRIVE like never before!”

We’ll see if that warrants a tweet from Elon.

Tesla revenue drops 12% year over year 

With an expiring EV credit and more competition from other automakers, Tesla is feeling the heat.

If the Oscars tell us the best movies of the year, there’s always the Razzies to honor the worst. And if earnings reports can tell us who’s winning amidst a 

Enter a new loser in the tariff saga: General Motors, which reported a $1.1 billion hit from tariffs in the latest quarter. Yes, 

. That sent GM’s profit plummeting in Q2 by 

In May, GM lowered its full-year profit guidance, saying it expected to face from $4 billion to $5 billion in tariff-related costs over the course of the year. In its latest earnings report, the company affirmed its guidance, but said it anticipates a larger tariff hit in Q3 than in the latest quarter “due to timing of indirect tariff costs.”

For Q2, profit came in at $1.9 billion, declining from $2.9 billion in Q2 2024.

Despite the apparent doom and gloom, General Motors stressed that it was “making solid progress” toward its goal of mitigating “at least 30%” of the tariff impact “through manufacturing adjustments, targeted cost initiatives, and consistent pricing.”

And if the company is sweating, it’s not letting it show. “We’ve got a longer-term plan to be able to mitigate a substantial part of this,” CFO Paul Jacobson said in reference to tariffs during the company’s earnings call. “We’re obviously looking for things to normalize around these trade deals that will get done, and we expect that will happen.”

GM is far from the only automaker struggling with tariff costs. Earlier this week, Stellantis, which makes Chrysler, Jeep, and Ram cars and trucks, reported a 

, which it attributed in part to tariffs and other Republican policies.

GM reports $1.1 billion tariff hit 

Oof, that’s gotta hurt. 

 about the impact that tariffs will have on companies’ bottom lines. For Stellantis, the tariff bill has come in at 

—and that’s for just the first half of the year.

The automaker, which owns Dodge, Ram, Fiat, Chrysler, and Peugeot in addition to Jeep, atypically 

 unaudited financial information for the first half of the year because it was “shaping up to be worse than analyst forecasts,” according to the Wall Street Journal. Analysts had predicted a $2.2 billion profit, but Stellantis reported only $585 million. Shipments dropped 6% YoY in Q2, and the company saw a $2.7 billion loss for the first six months of the year, its worst since 2021.

Stellantis cited several factors driving the losses, including higher industrial costs, adverse foreign exchange rate changes, shuttered production capacity, and the monster wallop of US tariffs.

Chief Financial Officer Doug Ostermann said the full year impact of tariffs could climb to $1.8 billion.

Revenue dropped 12.6% to $87 billion, down from $99.4 billion in the first half of 2024. The company expects North American shipments to continue to decline by 25% YoY in H2.

Stellantis will publish audited financial results as planned on July 29.

Chrysler Dodge Jeep Ram Stellantis dealership