Ford Motor Company (F) Income Statement

The revenue trajectory has been volatile, with growth swinging from -5.0% in 2025Q1 to +9.4% in 2025Q3, then back to negative in 2026Q2. This pattern suggests that Ford's top line is highly sensitive to product cycles and macroeconomic conditions, particularly in North America where the company is concentrated. The recent contraction may reflect lower average transaction prices and reduced volume, as the company prioritizes profitability over market share. Investors should monitor whether this is a temporary dip or the start of a sustained downturn.

The wide fluctuation in gross margin—from 3.7% to 18.4% over the past year—indicates that Ford's cost structure is highly sensitive to product mix, input costs, and production inefficiencies. The 2025Q4 collapse to 3.7% was likely driven by one-time charges, but the persistence of sub-10% margins in several quarters suggests that the company's legacy ICE business is not generating the same profitability as before. The elevated warranty expenses and the drag from Model e are likely compressing margins, and the company's ability to expand margins will depend on scaling EV production and reducing complexity.

SG&A expenses have remained relatively stable between $2.5B and $2.9B over the past ten quarters, even as revenue fluctuated between $40.7B and $50.5B. This indicates that Ford's overhead is largely fixed, and the company cannot easily scale down costs during downturns. The operating margin has been consistently low, ranging from -2.0% to 5.4%, which suggests that the company is not benefiting from economies of scale. The lack of operating leverage is a concern, as it means that any revenue decline will disproportionately impact profitability.

The cost of goods sold has been consistently high, with gross margins often below 10%, which is low for an automaker. This suggests that Ford is facing significant input cost pressures, including raw materials and labor, and is unable to pass these costs on to consumers. The 2025Q4 COGS ratio of 96.3% is particularly alarming, though it may include one-time charges. The company's high fixed-cost structure and ongoing EV investments are likely to keep cost pressures elevated, and management's focus on 'more profitable, more disciplined' operations may help, but evidence of improvement is not yet visible in the data.