02:05 PM EDT, 10/24/2025 (MT Newswires) -- Ford's (F) third-quarter results were strong, though the automaker must arrest continued losses in its electric-vehicle business to become a "compelling" story in 2026, RBC Capital Markets said in a note e-mailed Friday.

Late Thursday, Ford reported third-quarter adjusted earnings of $0.45 a share, down from $0.49 a year earlier, while revenue rose 9% to $50.53 billion. The results comfortably exceeded Wall Street's views for $0.35 and $47.05 billion, respectively.

Ford now anticipates reporting 2025 adjusted earnings before interest and taxes of $6 billion to $6.5 billion, down from $6.5 billion to $7.5 billion previously expected. A recent fire at an aluminum plant in Oswego, New York, is expected to cost Ford about $1 billion or less between 2025 and 2026, the company said.

"We not only solidly beat expectations, but our underlying performance has us on track to raise our full-year 2025 EBIT guidance if it weren't for the impact of the Novelis fire in Oswego," Ford Chief Executive Jim Farley said on an earnings conference call, according to a FactSet transcript.

The company's core loss at its Model e segment widened to $1.41 billion from $1.23 billion a year earlier, bringing the division's year-to-date loss to $3.59 billion.

Overall, Ford's September-quarter results were strong, likely benefiting from some pull-forward from the fourth quarter, though worsening Model e losses could prove "problematic," RBC analyst Tom Narayan said in a note to clients.

"Should Ford be able to reduce its EV losses and tariffs come down further, we think it could be a compelling (2026) story," Narayan wrote.

RBC raised its price target on the Ford stock to $12 from $11, with a sector perform rating.

The company's shares were up 12% in Friday afternoon trade. The stock has surged nearly 40% so far this year.

Ford has made "substantial progress" to minimize the impact of the fire incident at the Novelis plant and to recover production in 2026, Farley said in an earnings release. The automaker outlined plans to create up to 1,000 jobs to boost F-Series production volume to recover losses due to the Novelis fire.

RBC raised its 2026 EBIT outlook for Ford to $7.9 billion from $7.6 billion.

Recently, General Motors ( GM ) announced a $1.6 billion charge based on a planned "strategic realignment" of its EV capacity and production footprint. RBC said Ford could be "doing something similar."

"Regarding upside on tariffs, the (2026) level assumes the current 25% level on Canada and Mexico, and we do expect (US-Mexico-Canada Agreement) resolution to occur latest by July," Narayan said. "This could include US contenting requirements at 50%, which Ford could achieve easily. This could provide further upside to (2026) estimates."

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