CNH earnings analysis
What we found in CNH's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
CNH delivered Q2 revenue of $4.803 billion, up 2.0% year over year, driven by 12.0% Construction growth, but profitability deteriorated materially: net income fell to $141 million from $217 million and Agriculture adjusted EBIT margin fell 290 basis points to 5.2%. Gross margin declined to 18.0% from 20.6% as tariffs and lower production volumes raised cost of goods sold to 82.0% of net sales. Cash generation also weakened, with first-half operating cash flow of $180 million versus $934 million a year earlier, largely due to a $436 million inventory-related cash use.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Revenue returned to modest growth
- Q2 total revenue increased 2.0% year over year to $4.803 billion, while net sales rose 3.0% to $4.143 billion. Construction was the principal growth driver.
- Construction shipment growth accelerated
- Construction net sales rose 12.0% to $866 million, led by a 23.5% increase in North America to $468 million; management cited higher shipments, including volumes delayed from Q1.
- Agriculture pricing supported sales
- Agriculture sales held broadly flat, rising 0.9% to $3.277 billion, as favorable pricing partly offset lower volumes. North America sales increased 9.9% to $1.229 billion and Asia-Pacific increased 11.3% to $346 million.
- Potential tariff-recovery tailwind
- CNH recognized a $5 million tariff recovery as a reduction in cost of sales during the first half and expects to recover approximately $150 million of IEEPA tariffs in future periods, subject to cash receipt and recognition criteria.
- Liquidity and covenant headroom remain solid
- Available liquidity remained substantial at $8.897 billion at June 30, including $6.273 billion of undrawn medium-term unsecured committed facilities. The company was in compliance with all covenants on its €3.25 billion revolving credit facility.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Margin pressure drove sharp earnings decline
- Net income declined 35.0% year over year to $141 million from $217 million. Cost of goods sold increased to 82.0% of net sales from 79.4%, reflecting tariff costs and lower production volumes.
- Agriculture profitability and South America weakened
- Agriculture adjusted EBIT fell $93 million to $170 million and margin contracted to 5.2% from 8.1%. South America agriculture sales declined 27.0% to $346 million amid lower volumes and unfavorable mix.
- Construction growth has low profitability
- Construction adjusted EBIT declined to $15 million from $35 million despite 12.0% sales growth, reducing adjusted EBIT margin to 1.7% from 4.5%; management cited tariffs and higher R&D expense.
- Working-capital build constrained cash flow
- Operating cash flow fell to $180 million for the first six months from $934 million, as inventories consumed $436 million of cash versus $51 million in the prior-year period. Consolidated inventory increased to $5.171 billion from $4.651 billion at year-end.
- South American credit quality deteriorated
- Financial Services receivables more than 30 days past due increased to 4.4% from 3.9% a year earlier, primarily reflecting pressure on South American farmers. Financial Services net income fell $16 million to $71 million.
- Liquidity declined and ratings outlook worsened
- Total available liquidity decreased $919 million from year-end to $8.897 billion, while S&P lowered CNH's rating to BBB from BBB+ and Fitch revised its BBB outlook to Negative from Stable.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $0.11
- Gross margin
- 18.0%
- Segment
- Agriculture net sales: $3.277 billion, +0.9% year over year
- Segment
- Construction net sales: $866 million, +12.0% year over year
- Segment
- Financial Services revenue: $656 million, -4.2% year over year
What they said about what is next.
The 10-Q does not provide explicit quantitative full-year revenue or EPS guidance. Management states it expects to recover approximately $150 million of IEEPA tariffs in future periods when recognition criteria are met, and believes current liquidity facilities and operating cash flow will satisfy debt-service needs for the coming year.
The filing reads about the same as the one before it.
What came before.
- 10-Q · April 30, 2026
- CNH Industrial reported Q1 2026 revenues of $3.83 billion, slightly below the $3.84 billion consensus estimate, with EPS matching estimates at $0.01. Despite flat revenues year-over-year, the company faced significant…
- 10-K · February 26, 2026
- CNH's 2025 10-K emphasizes remediation of a 2024 inventory control material weakness (concluded remediated as of December 31, 2025) and continued focus on cost, sourcing and R&D investments to respond to regulatory and…
- 10-Q · November 7, 2025
- CNH reported Q3 2025 revenues of $4,399 million (down 5.5% YoY from $4,654 million) and consolidated net income of $67 million, a large decline versus $310 million in Q3 2024. Industrial Activities’ Adjusted EBIT fell…
- 10-Q · August 4, 2025
- CNH reported total revenues of $4,711 million for Q2 2025, down 14.2% versus Q2 2024, with net income attributable to CNH of $213 million (net income $217 million). Industrial Activities saw Adjusted EBIT of $224…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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