CNH Industrial Q3 Adjusted EPS Doubles to $0.16 on Tariff Refunds; 2026 Outlook Raised
CNH Industrial's adjusted earnings doubled in the third quarter as refunds of IEEPA tariffs lifted margins in both of its equipment segments, and the farm and construction machinery maker raised its full-year profit outlook, according to its earnings release filed Monday.
Adjusted diluted EPS was $0.16 for the three months ended Sept. 30, 2026, up from $0.08 a year earlier. Adjusted net income rose 88.1% to $205 million from $109 million. The quarter included $109 million in pre-tax IEEPA tariff refunds, the company said.
Reported results moved the other way. Net income fell 47.8% to $35 million, or $0.02 per diluted share, from $67 million, or $0.06, after CNH recorded a $156 million non-cash charge to establish a valuation allowance against Financial Services' deferred tax assets in Brazil. That charge pushed the effective tax rate to 89.9% from 2.0%.
Consolidated revenue slipped 1.0% to $4.35 billion, and net sales of Industrial Activities were $3.68 billion, both essentially in line with the third quarter of 2025.
Outlook moves up
CNH now expects 2026 adjusted diluted EPS of $0.44 to $0.48, up from its previous range of $0.41 to $0.46. It raised its forecast for free cash flow of Industrial Activities to $300 million to $450 million, from $200 million to $400 million.
The company also now sees Construction net sales rising 8% to 10% for the year, compared with 5% to 10% before, and narrowed its Agriculture adjusted EBIT margin range to 5.1% to 5.4%.
CNH said it will reinvest nearly all of its tariff refunds in "selective and time-limited priorities." In Agriculture, it expects an estimated $70 million of gross refunds this year, with an estimated $50 million going to one-off efforts to clear aged and discontinued equipment inventory, leaving a full-year net refund benefit of just $5 million, the company said.
"Stronger quality performance, supply chain focus, and operational efficiencies reflect disciplined execution in a challenging market environment," Chief Executive Gerrit Marx said.
Construction's margin jump
Construction net sales rose 5.1% to $777 million on higher volumes in North America. Adjusted EBIT climbed to $65 million from $14 million, and the segment's adjusted EBIT margin widened to 8.4% from 1.9%, reflecting tariff refunds and lower SG&A expenses, partly offset by weaker volumes in South America.
Agriculture, the larger business, posted a 1.9% drop in net sales to $2.91 billion as volumes fell in South America and EMEA. Its adjusted EBIT still rose to $173 million from $137 million, lifting the margin to 6.0% from 4.6%.
Financial Services swung to a $77 million net loss from net income of $47 million, mainly because of the Brazil tax charge. Excluding that charge, the unit's adjusted net income rose to $79 million from $46 million.
Separately on Monday, CNH said in another 8-K that it agreed to sell a 70% interest in its Construction Equipment business to Kobelco Construction Machinery in a deal valuing that business at an enterprise value of $1 billion.
By the numbers
- Adjusted diluted EPS: $0.16, versus $0.08
- GAAP diluted EPS: $0.02, versus $0.06
- Consolidated revenue: $4.35 billion, down 1.0%
- Industrial Activities adjusted EBIT margin: 5.5%, versus 2.8%
- Operating cash flow: $686 million, versus $659 million
- 2026 adjusted diluted EPS outlook: $0.44 to $0.48
Sources
- CNH Industrial Form 8-K with third-quarter 2026 earnings release (Exhibit 99.1), filed Nov. 9, 2026 (accession 0001567094-26-000020)
- CNH Industrial Form 8-K on Construction Equipment joint venture agreement with Kobelco Construction Machinery, filed Nov. 9, 2026 (accession 0001193125-26-452698)
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