Core Insights - CNH Industrial is hosting its Investor Day 2025 at the New York Stock Exchange, focusing on strategic direction, innovation, sustainability, and productivity [1][3][7] - The event features presentations from key executives covering various aspects of the company, including agriculture products, precision technology, and financial performance [1][7] Company Overview - CNH Industrial is a global leader in equipment, technology, and services, with a mission centered on innovation and sustainability [3][4] - The company operates under several brands, including Case IH, New Holland, CASE, and others, providing a comprehensive range of agricultural and construction products [3][4] Event Details - The Investor Day presentations will begin at 9:00 am ET, with a full agenda including opening remarks, product overviews, and a Q&A session [1][7] - A recording of the event will be available shortly after its conclusion [2]

Financial Performance - Total revenues for the three months ended March 31, 2025, were $3,828 million, a decrease of 20.5% compared to $4,818 million in the same period of 2024[12] - Net income attributable to CNH Industrial N.V. for Q1 2025 was $131 million, down 64.4% from $368 million in Q1 2024[12] - The company incurred a net loss of $132 million for Q1 2025, compared to a net income of $369 million in Q1 2024, representing a decline of 135.7%[12] - Comprehensive income attributable to CNH Industrial N.V. was $188 million for Q1 2025, down 41.0% from $319 million in Q1 2024[15] - Basic earnings per share (EPS) attributable to common shareholders decreased from $0.29 in Q1 2024 to $0.10 in Q1 2025, with net income attributable to CNH Industrial N.V. dropping from $368 million to $131 million[37] Cash Flow and Liquidity - Cash and cash equivalents decreased to $1,695 million as of March 31, 2025, from $3,191 million at December 31, 2024, representing a decline of 46.9%[10] - The company reported a net cash used by operating activities of $162 million for Q1 2025, compared to a net cash used of $894 million in Q1 2024[18] - Cash flows from operating activities improved to $162 million in Q1 2025, compared to a cash outflow of $894 million in Q1 2024[18] Assets and Liabilities - Total assets decreased to $42,057 million as of March 31, 2025, from $42,933 million at December 31, 2024, a reduction of 2.0%[10] - Total liabilities decreased to $34,098 million as of March 31, 2025, from $35,165 million at December 31, 2024, a decline of 3.0%[10] - The company’s total liabilities for consolidated VIEs decreased from $10,577 million on December 31, 2024, to $9,967 million on March 31, 2025[35] Revenue Breakdown by Segment - Agriculture segment revenues decreased to $2,581 million in Q1 2025 from $3,373 million in Q1 2024, representing a decline of 23.5%[30] - Construction segment revenues fell to $591 million in Q1 2025, down 22.0% from $758 million in Q1 2024[30] - Financial Services revenues decreased to $651 million in Q1 2025 from $685 million in Q1 2024, a decline of 5.0%[30] Research and Development - Research and development expenses for Q1 2025 were $184 million, down 19.3% from $228 million in Q1 2024[12] - Research and development expenses for the Agriculture segment were $163 million in Q1 2025[51] Inventory and Receivables - Total inventory increased from $4,776 million as of December 31, 2024, to $5,156 million as of March 31, 2025, indicating growth in stock levels[58] - Financing receivables decreased from $10,831 million on December 31, 2024, to $10,207 million on March 31, 2025[35] - Total past due receivables in North America for 2025 were $1,182 million, with no charge-offs reported[70] Tax and Accounting - The effective tax rate increased from 19.2% in Q1 2024 to 29.0% in Q1 2025, attributed to the company's income mix and reduced rate relief from Argentina's economy[39] - The company is evaluating the impact of new accounting standards on its financial disclosures, with changes expected to be adopted in future reporting periods[27][28][29] Derivatives and Other Comprehensive Income - The total notional amount of CNH's foreign exchange derivatives was $4.7 billion as of March 31, 2025, compared to $4.2 billion at December 31, 2024[113] - The company's other comprehensive income for the three months ended March 31, 2025, was $60 million, compared to a loss of $49 million for the same period in 2024, reflecting a significant improvement[126] Related Party Transactions - Net revenues from transactions with Iveco Group for Q1 2025 were $27 million, down from $38 million in Q1 2024, indicating a decline in sales[136] - Related party transactions showed net sales of $76 million in Q1 2025, a decrease from $158 million in Q1 2024, highlighting a significant drop in sales to related parties[138]

Core Insights - CNH Industrial reported first-quarter 2025 adjusted earnings per share (EPS) of 10 cents, down from 33 cents in the prior-year quarter, but above the Zacks Consensus Estimate of 9 cents [1] - Consolidated revenues for the first quarter declined nearly 21% year over year to $3.82 billion, exceeding the Zacks Consensus Estimate of $3.79 billion [1] Segmental Performance - Agriculture segment net sales fell 23% year over year to $2.58 billion, missing the estimate of $2.62 billion, with adjusted EBIT down 64% to $139 million, also below the estimate of $237.6 million [2] - Construction segment sales declined 22% year over year to $591 million, missing the estimate of $592.1 million, with adjusted EBIT down 73% to $14 million, below the estimate of $26.1 million [3] - Financial Services segment revenues decreased 5% to $651 million, surpassing the estimate of $536.7 million, while net income fell to $90 million from $118 million in the prior year [4] Financial Overview - As of March 31, 2025, CNH Industrial had cash and cash equivalents of $1.7 billion, down from $3.19 billion as of December 31, 2024 [4] - Total debt was $26 billion as of March 31, 2025, down from $26.9 billion as of December 31, 2024 [5] - The company reported negative free cash flow from industrial activities of $567 million in the quarter, an improvement from negative free cash flow of $1.21 billion in the first quarter of 2024 [5] Guidance Updates - For 2025, Agriculture sales are expected to decrease by 12-20%, with adjusted EBIT margin projected between 7-9%, revised from the previous guidance of 8.5-9.5% [6] - Construction segment sales are expected to decline by 4-15%, with adjusted EBIT margin expected between 2-4%, down from the earlier guidance of 4-5% [6] - Free cash flow from industrial activities is now expected in the range of $100-$500 million, revised from $200-$500 million, and adjusted EPS is expected between 50 cents and 70 cents, down from 65-75 cents [7]

Core Insights - CNH Industrial reported $3.83 billion in revenue for Q1 2025, a year-over-year decline of 20.6%, with an EPS of $0.10 compared to $0.33 a year ago, indicating a significant drop in profitability [1] - The revenue exceeded the Zacks Consensus Estimate of $3.79 billion by 1.14%, while the EPS surpassed the consensus estimate of $0.09 by 11.11% [1] Revenue Breakdown - Total Industrial Activities in Agriculture generated $2.58 billion, exceeding the five-analyst average estimate of $2.48 billion, but reflecting a year-over-year decline of 23.5% [4] - Total Industrial Activities in Construction reported $591 million, below the average estimate of $624.37 million, marking a 22% year-over-year decrease [4] - Net Sales amounted to $3.17 billion, surpassing the five-analyst average estimate of $3.12 billion, with a year-over-year decline of 23.2% [4] - Finance, interest, and other income reached $656 million, slightly below the estimated $660.13 million, representing a 4.5% year-over-year decline [4] - Financial Services generated $651 million, exceeding the average estimate of $635.15 million, but showing a 5% decrease compared to the previous year [4] - Total Industrial Activities reported $3.20 billion, above the average estimate of $3.15 billion, with a year-over-year decline of 23.3% [4] - Eliminations resulted in a loss of $25 million, significantly worse than the average estimate of $1.49 million, reflecting a 37.5% year-over-year decline [4] Adjusted EBIT Performance - Adjusted EBIT for Industrial Activities in Agriculture was $139 million, slightly below the average estimate of $143.03 million [4] - Adjusted EBIT for Industrial Activities in Construction was $14 million, below the average estimate of $21.91 million [4] - Adjusted EBIT for Unallocated items, eliminations, and other was -$52 million, compared to the average estimate of -$54.20 million [4] - Total Industrial Activities adjusted EBIT was $101 million, exceeding the average estimate of $83.73 million [4] Stock Performance - CNH shares have returned -6.2% over the past month, contrasting with the Zacks S&P 500 composite's -0.7% change [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

Financial Data and Key Metrics Changes - Consolidated revenues for Q1 2025 were down 21% at $3.8 billion, with industrial adjusted EBIT at $101 million, down 73% year-over-year, and EPS for the quarter at $0.10 [12][19] - Free cash flow for industrial activities was an outflow of $567 million, which is significantly better compared to Q1 2024 due to more contained growth of finished goods and component inventories [19] - Gross margin for agriculture was 20%, down 380 basis points year-over-year, primarily due to lower production volumes and unfavorable mix, partially offset by operational cost reductions [19] Business Line Data and Key Metrics Changes - In agriculture, net sales decreased 23% in Q1 2025, driven by lower shipments across all regions due to weak industry demand and network destocking [19] - Construction net sales for Q1 were $591 million, down 22% year-over-year, with a gross margin of 14.9%, down 250 basis points compared to Q1 2024 [21] - Financial Services segment reported net income of $90 million, with a year-over-year decrease mainly due to higher expected risk costs and taxes [22] Market Data and Key Metrics Changes - Retail demand was slow in Q1, with production hours down 26% compared to Q1 2024, agriculture down 27%, and construction down 19% [13] - The Turkish market showed continued softness, impacting joint venture results in the Other category [21] - Delinquencies increased, particularly in South America and growing in North America, aligning with expectations during a downturn [22] Company Strategy and Development Direction - The company is focused on operational excellence, advancing technologies, and executing cost-saving initiatives while preparing for a new model year lineup [11][14] - The company aims to balance production levels with market demand, keeping production low to manage inventory effectively [12][14] - Strategic discussions are ongoing regarding potential partnerships in the construction business, but decisions are paused until market uncertainty settles [41] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the soft industry demand and the need for a cautious approach to production and inventory management [12][16] - The company expects the second half of the year to show improved profitability, returning to double-digit margins [67] - Management is actively monitoring tariff discussions and their potential impacts on operations and pricing strategies [15][28] Other Important Information - The company announced leadership changes, including the appointment of Jim Nicholas as the new CFO [6][10] - The company is committed to maintaining a strong presence in North America while adapting to global trade changes [31][35] - The company is preparing for an Investor Day to provide more insights into its product roadmap and strategic initiatives [44] Q&A Session Summary Question: Can you quantify the EPS impact from tariffs? - Management indicated that all changes in guidance are due to tariff scenarios, with a midpoint estimate reflecting potential impacts [50][51] Question: What is the outlook for production costs related to quality? - Management expects quality-related costs to improve in the coming quarters as product quality has been enhanced [55][56] Question: Can you elaborate on price adjustments and procurement efforts? - Price adjustments are moderate and aligned with cost movements, and the company is actively working with suppliers to share tariff-related costs [61][63] Question: How should we think about ag segment margins as the year progresses? - The first quarter is typically low, with expectations for improved margins in the second half of the year [66][67] Question: What is the current state of dealer inventories? - The company aims for a significant inventory reduction, having achieved a $100 million reduction in Q1, and will continue to monitor production levels closely [81][82]

Financial Data and Key Metrics Changes - Consolidated revenues for Q1 2025 were down 21% at $3.8 billion, with industrial adjusted EBIT down 73% to $101 million, and EPS for the quarter was $0.10 [12][20][23] - Free cash flow for industrial activities was a $567 million outflow, which is an improvement compared to Q1 2024 due to better management of finished goods and component inventories [20][23] - Gross margin for agriculture was 20%, down 380 basis points year over year, primarily due to lower production volumes and unfavorable mix [20][21] Business Line Data and Key Metrics Changes - Agriculture net sales decreased 23% in Q1 2025, driven by lower shipments across all regions due to weak industry demand and dealer destocking [20][22] - Construction net sales for Q1 were $591 million, down 22% year over year, primarily due to lower shipment volumes in North America [22] - Financial Services segment reported net income of $90 million, with a year-over-year decrease mainly due to higher expected risk costs and taxes [23][24] Market Data and Key Metrics Changes - Retail demand was slow, with production hours down 26% compared to Q1 2024, with agriculture down 27% and construction down 19% [13] - The Turkish market showed continued softness, impacting joint venture results in the Other category [22] - Delinquencies increased, particularly in South America and North America, aligning with expectations during a downturn [25] Company Strategy and Development Direction - The company is focused on operational excellence, advancing technologies, and executing cost-saving initiatives while preparing for a new model year lineup [11][12] - A modest price adjustment was implemented in North America for new orders, with the aim to share tariff cost impacts with suppliers [15][63] - The company is committed to maintaining a balanced global exposure and is actively engaged in scenario planning regarding tariffs and trade impacts [30][31] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the current market headwinds and the necessity of keeping production low to navigate the downturn effectively [12][17] - The company expects a gradual recovery in the second half of the year, with a return to double-digit profitability in agriculture [68] - There is cautious optimism regarding the potential for a rebound in demand, particularly in Brazil, contingent on global trade developments [88] Other Important Information - The CFO announced his departure effective May 6, with Jim Nicholas set to succeed him [5][6] - The company is preparing for an Investor Day to provide more insights into its product roadmap and strategic initiatives [11][45] Q&A Session Summary Question: Can you quantify the EPS headwind from tariffs? - Management indicated that all changes in guidance are due to tariff scenarios, with a midpoint estimate provided for potential impacts [51][53] Question: What is the outlook for production costs in the Ag business? - Management confirmed that production costs were down, with expectations for improved quality and reduced warranty spend in the coming quarters [55][57] Question: Can you elaborate on price adjustments and procurement efforts? - Price adjustments were implemented to balance cost increases, and discussions with suppliers are ongoing to share tariff-related costs [63][65] Question: How should we think about Ag segment margins as the year progresses? - The first quarter is typically low, with expectations for improved margins in the second half of the year [68] Question: What is the current state of dealer inventories? - The company reported a $100 million reduction in dealer inventories, with plans to continue monitoring and adjusting production levels [85][86]

分组1 - CNH Industrial reported quarterly earnings of $0.10 per share, exceeding the Zacks Consensus Estimate of $0.09 per share, but down from $0.33 per share a year ago, representing an earnings surprise of 11.11% [1] - The company posted revenues of $3.83 billion for the quarter, surpassing the Zacks Consensus Estimate by 1.14%, but down from $4.82 billion year-over-year [2] - Over the last four quarters, CNH has only surpassed consensus EPS estimates once and has topped consensus revenue estimates just once [2] 分组2 - The stock has increased approximately 2.1% since the beginning of the year, while the S&P 500 has declined by 5.3% [3] - The current consensus EPS estimate for the upcoming quarter is $0.17 on revenues of $4.47 billion, and for the current fiscal year, it is $0.64 on revenues of $17.06 billion [7] - The Manufacturing - Farm Equipment industry, to which CNH belongs, is currently ranked in the bottom 32% of over 250 Zacks industries, indicating potential challenges ahead [8]

Q1 2025 RESULTS REVIEW May 1, 2025 SAFE HARBOR STATEMENT AND DISCLOSURES All statements other than statements of historical fact contained in this presentation including competitive strengths; business strategy; future financial position or operating results; budgets; projections with respect to revenue, income, earnings (or loss) per share, capital expenditures, dividends, liquidity, capital structure or other financial items; costs; and plans and objectives of management regarding operations and products, ...

[First Quarter 2025 Financial and Operational Highlights](index=1&type=section&id=First%20Quarter%202025%20Financial%20and%20Operational%20Highlights) CNH Industrial reported a significant decline in Q1 2025 results, with consolidated revenues falling 21% to $3.8 billion and diluted EPS dropping to $0.10, driven by lower demand and dealer destocking [Q1 2025 Performance Summary](index=1&type=section&id=Q1%202025%20Performance%20Summary) CNH Industrial reported a significant decline in Q1 2025 results, with consolidated revenues falling 21% to $3.8 billion and diluted EPS dropping to $0.10, driven by lower demand and dealer destocking | Metric | Q1 2025 | Q1 2024 | Change | Change at constant currency | | :--- | :--- | :--- | :--- | :--- | | **Consolidated revenues** | $3,828 Million | $4,818 Million | (21)% | (17)% | | **Net sales of Industrial Activities** | $3,172 Million | $4,131 Million | (23)% | (21)% | | **Net income** | $132 Million | $369 Million | (64)% | - | | **Diluted EPS** | $0.10 | $0.29 | ($0.19) | - | | **Adjusted net income** | $132 Million | $388 Million | (66)% | - | | **Adjusted diluted EPS** | $0.10 | $0.30 | ($0.20) | - | | **Cash flow from operating activities** | $162 Million | ($894) Million | +$1,056 Million | - | | **Free cash flow of Industrial Activities** | ($567) Million | ($1,209) Million | +$642 Million | - | - The decline in Net sales of Industrial Activities was mainly attributed to lower shipments resulting from decreased industry demand and dealer destocking[4](index=4&type=chunk) - Management emphasized a focus on reducing dealer inventories and managing costs to navigate current macroeconomic uncertainties, expressing confidence in strategic initiatives ahead of the upcoming Investor Day[1](index=1&type=chunk) [Segment Performance](index=3&type=section&id=Segment%20Performance) This section details the performance of Agriculture, Construction, and Financial Services segments, all experiencing revenue declines and margin contractions [Agriculture](index=3&type=section&id=Agriculture) The Agriculture segment saw a 23% decline in net sales to $2.58 billion and a 64% drop in Adjusted EBIT to $139 million due to lower demand and shipments | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | **Net sales** | $2,581 Million | $3,373 Million | (23)% | | **Gross profit margin** | 20.0% | 23.8% | (380) bps | | **Adjusted EBIT** | $139 Million | $388 Million | (64)% | | **Adjusted EBIT margin** | 5.4% | 11.5% | (610) bps | - Industry demand for tractors and combines fell sharply in North America (down **12-51%**) and EMEA (down **23-34%**), while South America saw a rebound with tractor and combine demand up **10%** and **1%** respectively[7](index=7&type=chunk) - The decrease in Adjusted EBIT was primarily caused by lower shipment volumes, partially offset by improved purchasing and manufacturing costs and reduced SG&A expenses[9](index=9&type=chunk) [Construction](index=3&type=section&id=Construction) The Construction segment's net sales decreased by 22% to $591 million, with Adjusted EBIT falling 73% to $14 million due to lower volumes and unfavorable pricing | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | **Net sales** | $591 Million | $758 Million | (22)% | | **Gross profit margin** | 14.9% | 17.4% | (250) bps | | **Adjusted EBIT** | $14 Million | $51 Million | (73)% | | **Adjusted EBIT margin** | 2.4% | 6.7% | (430) bps | - Global industry volume for Heavy construction equipment increased by **2%**, while Light construction equipment decreased by **6%**, with aggregated demand falling in North America (**-11%**), EMEA (**-9%**), and South America (**-1%**), but growing in Asia Pacific (**+7%**)[10](index=10&type=chunk) [Financial Services](index=3&type=section&id=Financial%20Services) Financial Services revenues declined 5% to $651 million, with net income decreasing 24% to $90 million due to currency impacts and increased risk costs | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | **Revenues** | $651 Million | $685 Million | (5)% | | **Net income** | $90 Million | $118 Million | (24)% | - The managed portfolio stood at **$28.0 billion** as of March 31, 2025, a slight decrease from the prior year[14](index=14&type=chunk) - The balance of receivables more than 30 days past due as a percentage of the receivable portfolio increased to **2.3%** from **1.7%** as of March 31, 2024[14](index=14&type=chunk) [2025 Outlook](index=4&type=section&id=2025%20Outlook) CNH updated its 2025 full-year guidance, lowering and widening ranges for net sales, EBIT margins, and EPS due to macroeconomic uncertainty and inventory reduction strategy [Updated 2025 Full-Year Guidance](index=4&type=section&id=Updated%202025%20Full-Year%20Guidance) CNH updated its 2025 outlook, lowering and widening guidance ranges for net sales, EBIT margins, and EPS due to macroeconomic uncertainty and inventory reduction strategy - The company anticipates lower global industry retail sales in 2025 for both agriculture and construction equipment markets compared to 2024[15](index=15&type=chunk) - CNH is focused on reducing excess channel inventory by producing fewer units than the retail demand level, which will negatively impact 2025 net sales[15](index=15&type=chunk) | Metric | Updated 2025 Outlook | Previous 2025 Outlook | | :--- | :--- | :--- | | **Agriculture Net Sales (YoY)** | Down 12% to 20% | Down 13% to 18% | | **Agriculture Adj. EBIT Margin** | 7% to 9% | 8.5% to 9.5% | | **Construction Net Sales (YoY)** | Down 4% to 15% | Down 5% to 10% | | **Construction Adj. EBIT Margin** | 2% to 4% | 4% to 5% | | **Free Cash Flow of Industrial Activities** | $100 Million to $500 Million | $200 Million to $500 Million | | **Adjusted Diluted EPS** | $0.50 to $0.70 | $0.65 to $0.75 | [Financial Statements](index=8&type=section&id=Financial%20Statements) This section presents the Consolidated Statements of Operations, Balance Sheets, and Cash Flows, detailing the company's financial performance and position [Consolidated Statements of Operations](index=8&type=section&id=Consolidated%20Statements%20of%20Operations) This statement details the company's revenues, costs, and profits, showing a decline in total revenues from **$4.8 billion** to **$3.8 billion** and net income from **$369 million** to **$132 million** | ($ million, except per share data) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | **Total Revenues** | $3,828 | $4,818 | | Cost of goods sold | $2,569 | $3,195 | | Total Costs and Expenses | $3,666 | $4,416 | | Income before Income Taxes | $162 | $402 | | **Net Income** | $132 | $369 | | Net Income attributable to CNH | $131 | $368 | | **Diluted EPS** | $0.10 | $0.29 | [Consolidated Balance Sheets](index=9&type=section&id=Consolidated%20Balance%20Sheets) This statement shows the company's financial position, highlighting a decrease in cash from **$3.2 billion** to **$1.7 billion** and total debt from **$26.9 billion** to **$26.0 billion** | ($ million) | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $1,695 | $3,191 | | Inventories, net | $5,156 | $4,776 | | **Total Assets** | **$42,057** | **$42,933** | | **Liabilities and Equity** | | | | Debt | $26,010 | $26,882 | | **Total Liabilities** | **$34,098** | **$35,165** | | **Total Equity** | **$7,902** | **$7,713** | [Consolidated Statements of Cash Flows](index=11&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) This statement details cash flows from operating, investing, and financing activities, showing a significant improvement in net cash from operating activities to **$162 million** from a **($894 million)** use | ($ million) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | **Net cash provided (used) by operating activities** | **$162** | **($894)** | | Net cash provided (used) by investing activities | ($280) | ($419) | | Net cash provided (used) by financing activities | ($1,422) | $319 | | Net increase (decrease) in cash, cash equivalents and restricted cash | ($1,468) | ($1,086) | [Supplemental Financial Information and Non-GAAP Reconciliations](index=5&type=section&id=Supplemental%20Financial%20Information%20and%20Non-GAAP%20Reconciliations) This section provides reconciliations for key non-GAAP financial metrics and details an immaterial correction to prior period financial statements [Non-GAAP Reconciliations](index=18&type=section&id=Non-GAAP%20Reconciliations) This section provides reconciliations for key non-GAAP metrics, including Adjusted EBIT by segment, Net Cash (Debt), Free Cash Flow of Industrial Activities, and Adjusted Diluted EPS Adjusted EBIT of Industrial Activities by Segment | ($ million) | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Agriculture | $139 | $388 | | Construction | $14 | $51 | | Unallocated items, eliminations and other | ($52) | ($67) | | **Total Adjusted EBIT of Industrial Activities** | **$101** | **$372** | Reconciliation to Free Cash Flow of Industrial Activities | ($ million) | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided (used) by Operating Activities | $162 | ($894) | | Less: Cash flows from Operating Activities of Financial Services | (638) | (198) | | Less: Investments in PP&E and intangibles of Industrial Activities | (103) | (96) | | Other adjustments | 12 | (21) | | **Free cash flow of Industrial Activities** | **($567)** | **($1,209)** | [Revision of Prior Period Financial Statements](index=22&type=section&id=Revision%20of%20Prior%20Period%20Financial%20Statements) The company disclosed an immaterial correction to prior period financial statements due to accounting treatment for an unconsolidated affiliate in Türkiye under highly inflationary conditions - An immaterial correction was made to prior periods' results for the accounting treatment related to the highly inflationary economy in Türkiye and its impact on an unconsolidated affiliate[58](index=58&type=chunk) - The correction fixed an overstatement of CNH's 'Equity in income of unconsolidated subsidiaries and affiliates' by **$96 million** in 2023 and **$67 million** in the first half of 2024[58](index=58&type=chunk) Impact of Revision on Q1 2024 Results | ($ million, except EPS) | Previously Reported | Revision Impacts | As Revised | | :--- | :--- | :--- | :--- | | Equity in income of unconsolidated subsidiaries | $77 | ($33) | $44 | | Net income | $402 | ($33) | $369 | | Diluted EPS | $0.31 | ($0.02) | $0.29 |

Financial Performance - CNH Industrial reported consolidated revenues of $3.83 billion for Q1 2025, a decrease of 21% compared to Q1 2024 [1][5] - Net income for the quarter was $132 million, down 64% from $369 million in the same period last year [1][6] - Diluted earnings per share (EPS) were $0.10, compared to $0.29 in Q1 2024, reflecting a decline of $0.19 [1][5] Segment Performance - Net sales of Industrial Activities were $3.17 billion, down 23% year-over-year, primarily due to lower shipments and dealer destocking [1][5][10] - In the Agriculture segment, net sales decreased by 23% to $2.58 billion, with a gross profit margin of 20.0%, down from 23.8% [8][10][11] - The Construction segment saw net sales decline by 22% to $591 million, with an adjusted EBIT margin of 2.4%, down from 6.7% [12][13] Cash Flow and Financial Health - Cash flow provided by operating activities was $162 million, a significant improvement from a cash outflow of $894 million in Q1 2024 [1][7] - Industrial free cash flow absorption was $567 million, showing a year-over-year improvement of $642 million [1][7] - Cash and cash equivalents decreased to $1.70 billion from $3.19 billion at the end of Q1 2024 [5][37] Market Outlook - The company anticipates lower global industry retail sales in both agriculture and construction equipment markets for 2025 compared to 2024 [17][18] - CNH is focused on reducing excess channel inventory by producing fewer units than retail demand levels, which will lead to lower net sales in 2025 [17][18] - The ongoing macroeconomic uncertainties and potential global trade scenarios, including tariffs, may impact the company's forecasts for the year [19][20]