Wall Street didn't expect truck and engine manufacturer Navistar International (NYSE: NAV) to have a pretty Q3. Analysts had set downbeat expectations after two straight quarterly losses from the company, matched by Navistar's own predictions of losses totaling more than $100 million. With the company reporting earnings today, let's see how Navistar performed in the third quarter.

Could have been worse
The financials beat analyst expectations, sending shares of Navistar up more than 12% in early trading. The company reported net income of $84 million for Q3 2012, breaking out of the red but considerably down from last year's $1.4 billion Q3 profit.

EPS results came in at earnings of $1.22 per share, while analysts had expected a loss of $1.36 per share. Sales of just over $3.3 billion beat Navistar's own revenue predictions of $2.8 billion, but still fell 6% from year-ago revenues of nearly $3.5 billion. In brighter results, the company's truck division did cut losses year over year by more than 50%.

A $196 million tax benefit managed to save the company's quarter. The company reported a net loss of $100 million before income taxes, down from a $54 million loss in Q3 2011.

Planning the right future
New CEO Lewis Campbell expressed disappointment in the data, stating: "Clearly we are not pleased with these results." Fortunately for Navistar shareholders, Campbell has his eyes set on a brighter future. The company produced a plan to cut its workforce in expectations of saving around $80 million in costs this year. Furthermore, the company ceased its plans to develop a new diesel engine last month after struggling with the Environmental Protection Agency for approval. The high costs of the program weighed on this quarter's results, so its termination should shine a light on better future numbers.

Looking ahead, the company last month suspended guidance for the year and plans to sell operations off. Campbell wants to slash operating costs up to $175 million in FY13, a move that would greatly contribute to better results for the company's lackluster financials.

Investors should keep an eye out for this company. These numbers might not blow anyone away, but Navistar's new chief executive seems to have a great grasp on planning a stronger future. In planning cost-cutting moves and restructuring, Campbell will take the right moves to push the company forward and reward shareholders. It may take some time, but Navistar looks to be headed on the right track.

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