CNH Industrial (CNH) Q3 2024 earnings summary

Executive summary

• Q3 2024 saw consolidated revenue decline 22% year-over-year to $4.65 billion, driven by weak industry demand, depressed commodity prices, and elevated dealer inventories across all regions.

• Net income for Q3 2024 was $310 million, down 43% from Q3 2023, with diluted EPS at $0.24 compared to $0.40 last year.

• Cost reduction, strategic sourcing, and operational streamlining initiatives continued, with a focus on long-term value and efficiency.

• Inventory levels remain above target despite lower production and retail demand, prompting ongoing underproduction into 2025.

• Prior periods were revised for an immaterial correction related to highly inflationary accounting in Türkiye.

Financial highlights

• Consolidated revenues fell 22% year-over-year to $4.7 billion; Industrial Activities net sales dropped 25% to $4.0 billion.

• Adjusted net income was $304 million, with adjusted EPS at $0.24, down from $0.40 in Q3 2023.

• Adjusted EBIT for Industrial Activities was $336 million, down 46% year-over-year; margin fell 340 basis points to 8.4%.

• Gross margin for Industrial Activities declined to 21.7% from 23.9% year-over-year.

• Free cash flow from Industrial Activities was an outflow of $180 million, consistent with seasonal working capital trends and lower activity.

Outlook and guidance

• Full-year 2024 Agriculture net sales expected to decline 22–23% year-over-year; adjusted EBIT margin guidance lowered to 10.5–11.5%.

• Construction net sales forecasted to be down 21–22% for the year, with adjusted EBIT margin between 5–6%.

• Industrial EBIT margin now expected at 8–9%; free cash flow projected negative, with an outflow of $100–300 million.

• Adjusted diluted EPS guidance revised to $1.05–1.15, with part of the change due to accounting revision.

• Underproduction to retail demand will likely continue through H1 2025, aiming to align production with retail by H2.