Loading...
01/09 21:01
Loading...
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call reveals significant challenges: declining sales, reduced EBIT margins, and negative cash flow outlook. Although there are cost reductions and a stable shareholder return plan, the financial health and future guidance are concerning. The Q&A highlights potential tariff impacts and flat pricing expectations, adding to uncertainties. Despite optimistic guidance for the second half of 2025, the immediate outlook is negative, with expected underproduction and margin pressures. These factors suggest a negative stock price movement in the near term.
Q4 2024 EPS $0.15, down from $0.39 in Q4 2023.
Q4 2024 Net Sales (Industrial Activities) $4.1 billion, down 31% year-over-year, driven by lower equipment deliveries and dealer inventory reductions.
Full Year 2024 Net Sales $17.1 billion, down 23% from 2023.
Full Year 2024 Adjusted EBIT Margin 8.2%, down 370 basis points compared to 2023, primarily due to lower volumes.
Q4 2024 Free Cash Flow $848 million, aligned with seasonal inventory depletion.
Full Year 2024 Cash Flow Outflow of $401 million, impacted by lower production levels and retail incentives.
Q4 2024 Gross Margin 20.6%, driven down by lower volumes.
Full Year 2024 Gross Margin 22.9%, down 260 basis points from 2023.
Q4 2024 SG&A Expenses $61 million lower compared to Q4 2023.
Full Year 2024 SG&A Expenses $176 million lower year-over-year.
Full Year 2024 R&D Expenses Down $105 million year-over-year.
Q4 2024 Adjusted EBIT Margin (Construction) 2.5%.
Full Year 2024 Adjusted EBIT Margin (Construction) 5.5%.
Q4 2024 Net Income (Financial Services) $92 million, down $21 million compared to Q4 2023.
Full Year 2024 Net Income (Financial Services) $379 million, up $8 million compared to 2023.
Retail Originations (Q4 2024) $3.2 billion.
Managed Portfolio (End of 2024) $27.8 billion.
Delinquencies (End of 2024) 1.9%, up from 1.4% at the end of 2023.
Run Rate Savings (End of 2024) $600 million, on top of $185 million in 2023.
New Product Launches: Launched renewed tractor and combine lineup with in-house precision digital technologies.
Precision-Related Components: In-house solutions for precision-related components increased from 60% to 80% in 2024.
Market Positioning: Expecting global industry demand to decline by 5% to 10% in 2025, with a more significant decline of 10% to 15% for CNH due to high exposure to cash crop equipment.
Channel Inventory Reduction: Dealers reduced inventory by over $700 million in Q4 2024, but still above target levels.
Operational Efficiencies: Achieved $600 million in run-rate savings by the end of 2024, on top of $185 million in 2023.
Production Adjustments: Cut Ag production hours by 34% year-over-year to manage inventory levels.
Strategic Focus: Continued focus on quality improvements and cost-saving initiatives to prepare for future market upturns.
Capital Allocation: Returned approximately $1.3 billion to shareholders through dividends and share repurchases in 2024.
Earnings Miss: CNH Industrial reported an EPS of $0.15, missing expectations of $0.19.
Market Demand: Industry demand remained weak throughout 2024, leading to a 20% decline in consolidated revenues and a 23% drop in industrial net sales.
Inventory Management: Despite efforts to reduce channel inventories, levels remained too high, with dealers having about 1.5 months of new equipment inventory above target.
Production Cuts: Production hours were cut by 34% year-over-year to manage inventory, with expectations to remain low through the first half of 2025.
Economic Factors: Depressed commodity prices negatively impacted farm income, leading to reduced equipment demand, particularly in North America.
Geopolitical Uncertainty: Ongoing geopolitical uncertainties, including situations in Ukraine and the Middle East, could affect operations and market conditions.
Labor Costs: Rising labor costs are anticipated as a headwind for the company in 2025.
Credit Risk: Increased credit risk provisions were noted due to higher delinquencies, particularly in South America, influenced by economic and climate factors.
Tariff Sensitivity: The company is preparing for potential tariff impacts on global material flows, with strategies for dual sourcing and pricing adjustments.
Cost Savings Initiatives: Exited 2024 with about $600 million of run rate savings, on top of $185 million in 2023, contributing to good decremental margins.
Production Adjustments: Cut Ag production hours by 34% year-over-year to reduce channel inventories.
Quality Improvement Focus: Investing in quality improvements to enhance customer product and service experience.
Strategic Sourcing Program: Implementing a strategic sourcing program for global flexibility and dual sourcing.
Capital Allocation: Continued investment in business and technology while maintaining a healthy balance sheet.
2025 Revenue Expectations: Forecasting Ag net sales to be lower than 2024 by 13% to 18% and construction net sales to be 5% to 10% lower.
EBIT Margin Projections: Ag EBIT margin forecasted between 8.5% and 9.5%; construction EBIT margin between 4% and 5%.
Overall Sales Guidance: Total industrial net sales expected to be 12% to 17% lower than 2024.
EPS Forecast: EPS is forecasted to be between $0.65 and $0.75.
Free Cash Flow Expectations: Positive free cash flow projected between $200 million and $500 million.
CapEx Guidance: CapEx estimated at about $0.5 billion in 2025.
Dividends Returned to Shareholders: In 2024, CNH Industrial returned approximately $1.3 billion to shareholders through dividends and share repurchases. The company will continue an annual dividend in 2025.
Share Repurchase Program: CNH Industrial will maintain its share repurchase program in 2025.
The earnings call presents a mixed picture. While there are positive signs like reaffirmed EPS guidance and better-than-expected currency impacts, concerns remain over tariff costs and declining margins. The Q&A reveals uncertainties about offsetting tariffs and achieving inventory targets, which could weigh on investor sentiment. Despite positive developments in production and sales, the lack of guidance for 2026 and global trade uncertainties further complicate the outlook, resulting in a neutral sentiment.
The earnings call reveals a mixed outlook with several concerning factors: declining revenue and EBIT margin guidance for 2025, uncertainties around tariffs, and increased delinquencies in Brazil. Although there are positive signs for 2026 and efforts towards cost savings and quality improvements, the immediate guidance is weak. Additionally, management's unclear responses on tariffs and partnerships further add to uncertainties. Given these factors, and without the influence of market cap data, the overall sentiment is negative, expecting a stock price decline of -2% to -8%.
The earnings call reveals significant challenges: declining revenues, margins, and EPS, compounded by tariff uncertainties. While management projects improvement in the latter half of the year, immediate financial metrics are weak. The Q&A session highlighted uncertainties and management's lack of clarity on key issues like EPS impact from tariffs and pricing adjustments. Despite a share buyback and dividend, the overall sentiment is negative due to weak guidance and financial performance, suggesting a likely stock price decline in the near term.
The earnings call reveals significant challenges: declining sales, reduced EBIT margins, and negative cash flow outlook. Although there are cost reductions and a stable shareholder return plan, the financial health and future guidance are concerning. The Q&A highlights potential tariff impacts and flat pricing expectations, adding to uncertainties. Despite optimistic guidance for the second half of 2025, the immediate outlook is negative, with expected underproduction and margin pressures. These factors suggest a negative stock price movement in the near term.
All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.
Full verbatim transcripts are typically published within 4–12 hours after the call ends. Same-day availability is guaranteed for all S&P 500 and most mid-cap companies.
No material content is ever changed or summarized in the “Full Transcript” section. We only correct obvious spoken typos (e.g., “um”, “ah”, repeated 10 times”, or clear misspoken ticker symbols) and add speaker names/titles for readability. Every substantive sentence remains 100% as spoken.
When audio quality is poor or multiple speakers talk over each other, we mark the section instead of guessing. This ensures complete accuracy rather than introducing potential errors.
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
