# On Identifying Why and When Foundation Models Perform Well on Time-Series Forecasting Using Automated Explanations and Rating

## TL;DR

This paper investigates why and when different time-series forecasting models perform well, combining explainable AI with rating explanations to assess model interpretability and performance across diverse real-world domains.

## Contribution

It introduces a combined approach of traditional XAI methods with Rating Driven Explanations to evaluate and interpret various TSFM architectures across multiple domains.

## Key findings

- Gradient Boosting outperforms foundation models in volatile domains.
- Foundation models excel in stable, trend-driven contexts.
- Explainability varies significantly across model types and domains.

## Abstract

Time-series forecasting models (TSFM) have evolved from classical statistical methods to sophisticated foundation models, yet understanding why and when these models succeed or fail remains challenging. Despite this known limitation, time series forecasting models are increasingly used to generate information that informs real-world actions with equally real consequences. Understanding the complexity, performance variability, and opaque nature of these models then becomes a valuable endeavor to combat serious concerns about how users should interact with and rely on these models' outputs. This work addresses these concerns by combining traditional explainable AI (XAI) methods with Rating Driven Explanations (RDE) to assess TSFM performance and interpretability across diverse domains and use cases. We evaluate four distinct model architectures: ARIMA, Gradient Boosting, Chronos (time-series specific foundation model), Llama (general-purpose; both fine-tuned and base models) on four heterogeneous datasets spanning finance, energy, transportation, and automotive sales domains. In doing so, we demonstrate that feature-engineered models (e.g., Gradient Boosting) consistently outperform foundation models (e.g., Chronos) in volatile or sparse domains (e.g., power, car parts) while providing more interpretable explanations, whereas foundation models excel only in stable or trend-driven contexts (e.g., finance).