CNH Raises 2026 Outlook After Kobelco Construction Deal

The Tip Desk · November 9, 2026 · 4 min read

Adjusted net income reached $205 million in the third quarter as the company lifted full-year adjusted diluted EPS to $0.44–$0.48.

CNH Industrial N.V. (CNH) reported net income of $35 million, or $0.02 a share, for the three months ended September 30, 2026, after a $156 million non-cash valuation allowance against Financial Services’ deferred tax assets in Brazil. Adjusted net income was $205 million, compared with $109 million a year earlier.

Consolidated revenues were $4.35 billion, essentially unchanged from the year-ago quarter. Net sales of Industrial Activities were $3.68 billion. The company recognized $109 million of pre-tax IEEPA tariff refunds in the quarter.

Adjusted EBIT of Industrial Activities was $202 million, with a 5.5% margin, after a 25% year-over-year decline in the second quarter. Adjusted diluted EPS was $0.16.

Agriculture remained the bulk of the industrial business. Net sales were $2.91 billion, down 2% from a year earlier, as volumes fell in South America and EMEA and were partly offset by Asia Pacific and price realization. Agriculture adjusted EBIT was $173 million and the margin was 6.0%, up 140 basis points from a year earlier. The company said the improvement primarily reflected IEEPA tariff refunds and better quality-related costs, partly offset by lower volumes in South America and EMEA.

North American industry sales volume was down 12% for tractors under 140 HP and 5% for tractors over 140 HP; combines were down 13%. In EMEA, tractor and combine demand were down 4% and 3%. South America saw tractor and combine demand decline 22% and 19%. Asia Pacific tractor demand decreased 4% while combine demand increased 76%.

Construction net sales were $777 million, up 5% from a year earlier, on higher volumes in North America partly offset by lower volumes in South America. Construction adjusted EBIT was $65 million and the margin was 8.4%. The company said the profit increase primarily reflected IEEPA tariff refunds and lower SG&A, partly offset by lower volumes in South America. Global industry sales volume rose 13% for heavy equipment and 6% for light equipment.

Financial Services total revenues were $665 million, down 3%. The unit recorded a net loss of $77 million, compared with net income of $47 million a year earlier, primarily reflecting the $156 million Brazil valuation allowance, unfavorable currency, and lower volumes in South America and North America, partly offset by lower risk costs in South America. Adjusted net income, which excludes the allowance, was $79 million. Retail loan originations were $2.48 billion. The managed portfolio was $27.8 billion. Receivables more than 30 days past due were 4.1% of receivables.

Net cash provided by operating activities was $686 million. Free cash flow used in Industrial Activities was $10 million.

Chief Executive Officer Gerrit Marx said the third-quarter results and the Kobelco agreement “reflect clear progress in the execution of our strategy.” The company said it reinvested about 35% of tariff refunds received in the quarter in selective time-limited efforts to clear aged inventory and accelerate its transformation. Agriculture used almost half of its refunds received in the quarter and will have reinvested over 90% by year-end in discrete time-limited priorities, the company said.

CNH announced an agreement with Kobelco Construction Machinery Co., Ltd., a wholly owned subsidiary of Kobe Steel, Ltd., to establish the Construction Equipment business as a joint venture under Kobelco’s majority ownership. The company said the transaction positions it as the largest pure-play agriculture machinery OEM.

CNH updated its 2026 outlook. Agriculture net sales are expected about flat year-over-year, including +2% currency translation effects, unchanged. Agriculture adjusted EBIT margin is now expected between 5.1% and 5.4%, previously 5.0% and 5.5%. Construction net sales are expected up 8% to 10% year-over-year, including +1% currency translation effects, previously 5% to 10% with 2% currency translation. Construction adjusted EBIT margin is now expected between 2.0% and 2.3%, previously 1.8% and 2.3%. Free cash flow of Industrial Activities is expected between $300 million and $450 million, previously $200 million and $400 million. Adjusted diluted EPS is expected between $0.44 and $0.48, previously $0.41 and $0.46.

The company said it forecasts a full-year net refund benefit of only $5 million in Agriculture after reinvesting in discretionary programs, and a full-year $30 million net refund benefit in Construction. It said the combined effect of tariff refunds, associated reinvestments, and prevailing market conditions is expected to have only a modest net impact on previously communicated guidance ranges.