ford (F) reported better-than-expected first-quarter results late Wednesday, although revenue fell short of forecasts. The company also revised aspects of its 2024 outlook as it expects losses from its EV segment. Ford shares jumped after the market closed.
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Ford reported a 3% increase in first-quarter revenue to $42.8 billion, while earnings per share fell 22% to 49 cents. Wall Street expected earnings per share to fall 32% to 43 cents on total revenue of $42.93 billion. Earlier this month, Ford said U.S. sales rose 6.8% in the first quarter, with total sales of electric vehicles including hybrids rising 82%.
The company is the latest auto giant to announce quarterly results after this General Motors (GM) surprised Wall Street with better-than-expected earnings and Tesla (TSLA) shares rose sharply on Tuesday’s outlook.
On March 26, Ford management reiterated guidance for annual core profit of $10 billion to $12 billion. Ford again said hybrids will be crucial as electric vehicles slow down. The company had announced that it would shift investments from electric vehicles to hybrid vehicles.
On Wednesday, Chief Financial Officer John Lawler said Ford’s full-year adjusted earnings before interest and taxes (EBIT) forecast was unchanged.
Meanwhile, Ford now expects free cash flow of $6.5 billion to $7.5 billion in 2024, up from its original forecast of $6 billion to $7 billion. The auto giant also said Wednesday that it expects capital spending of $8 billion to $9 billion in 2024, a narrower estimate compared to its previous forecast of $8 billion to $9.5 billion.
Ford also maintained its EBIT guidance of $8 billion to $9 billion for Ford Pro, $7 billion to $7.5 billion for Ford Blue and an EBIT loss of $5.0 billion to $5.5 billion for Ford Model e at.
In the first quarter, the company experienced a decline in Ford Model e sales as wholesale sales declined and significant industry-wide pricing pressure on electric vehicles continued to impact the market. The segment posted an EBIT loss of $1.3 billion, with costs remaining stable compared to the previous year.
Ford added that it expects the cost of electric vehicles to improve in the future.
Ford shares rose 1.3% late Wednesday. Shares rose 0.4% to 12.99 in regular market action. Ford shares rose about 0.5% on Tuesday on strong results and guidance from GM. According to MarketSurge, Ford shares have gained 6.7% ahead of this week’s earnings and are below the official buy point of 13.95.
On Tuesday, General Motors raised its 2024 forecast, expecting full-year earnings of $9.00 to $10.00 per share on adjusted earnings before interest and taxes (EBIT) between $12.5 billion and $14.5 billion -Dollar.
GM previously forecast earnings of $8.50 to $9.50 per share on adjusted EBIT of $12 billion to $14 billion. According to FactSet, Wall Street forecast full-year earnings of $8.89 per share on revenue of $172.27 billion.
Ford stock has a Composite Rating of 78 out of a best possible 99. It has a Relative Strength Rating of 66 and an EPS Rating of 85.
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