Ford earnings preview: Guidance update, shifting product strategy key for investors

Ford (F) will report first quarter results after the bell on Wednesday. Its changing product game plan will be front and center with its focus on gas and hybrid offerings to offset heavy spending on EVs.

The results come after GM reported strong Q1 results and boosted its yearly profit outlook, and investors will be looking to see if Ford can match that performance.

For the quarter, Ford is expected to report revenue of $40.04 billion, per Bloomberg consensus, a result that would be 3.5% lower than a year ago. Ford is also expected to post adjusted earnings per share of $0.42 on adjusted EBIT (earnings before interest and taxes) of $2.54 billion. Ford’s results should be slightly better than those in Q4, when it was dealing with the lingering effects of the United Auto Workers (UAW) strike.

Last year Ford divided its business into three units: Ford Blue, for traditional gas-powered autos; Ford Model e, for the EV division; and Ford Pro, for its commercial and super duty truck business. Here’s the expected breakdown:

  • Ford Blue: $24.57 billion in revenue, EBIT of $1.65 million

  • Model e: $1.22 billion in revenue, EBIT loss of $1.36 billion

  • Ford Pro: $15.28 billion in revenue, EBIT of $2.19 billion

During the first quarter, Ford pushed deeper into its gas and hybrid vehicles, with EV spending and production taking a back seat. Earlier this month, Ford said that it is pushing back EV production at its massive BlueOval City EV campus in Tennessee to 2026 from its initial 2025 start date. Ford also revealed it is “retiming” the launch of upcoming EVs at its plant in Oakville, Ontario, where it plans to build next-generation three-row EVs, and most likely a full-size SUV. The company is aiming to launch those vehicles in 2027, pushing back the original 2025 timeline.

Ford also said earlier in the quarter it would add a third shift to boost production of its Bronco SUV and midsize ranger pickup to meet customer demand. Meanwhile, Ford is focusing on its hybrid offerings, like the Maverick pickup and brand new F-150 with hybrid powertrain.

This was reflected in Ford’s Q1 US deliveries which jumped 6.8% to 508,083 vehicles, powered by strong sales of electrified products such as hybrids. Ford’s Maverick hybrid pickup saw its best quarter ever, with sales jumping 77% in the first quarter. Maverick also powered overall hybrid sales to a 42% jump to 38,421, with Ford claiming this was also the best quarter for hybrids and that momentum will continue.

DEARBORN, MICHIGAN - APRIL 11: The new Ford F-150 truck is launched at a celebratory event at the Ford Dearborn Plant on April 11, 2024 in Dearborn, Michigan. Both the F-150 and the all-new Ford Ranger trucks are now shipping to customers across North America. (Photo by Bill Pugliano/Getty Images)

The new Ford F-150 truck is launched at a celebratory event at the Ford Dearborn Plant on April 11, 2024, in Dearborn, Michigan. (Photo by Bill Pugliano/Getty Images) (Bill Pugliano via Getty Images)

Even Ford’s EV offerings — the Mustang Mach-E, Ford Lightning EV, and its commercial E-Transit vans —bucked the recent trend of softening demand. Ford’s overall EV portfolio saw a massive 82% jump to 20,223 EVs sold in Q1, with the Mustang Mach-E jumping 77.3% to 9,589 units sold and the Lightning pickup seeing sales surge 80.4% to 7,743 units. While the sales numbers here are strong, Ford relied on heavy discounting, cheap financing rates, and lease deals to move inventory.

A down note for Ford, however, was its flagship F-150 sales. Though the F-Series (which includes the F-150 and heavy-duty F-250 and F-350 offerings) retained the crown of America’s top-selling truck, sales fell 10.2% in the quarter to 152,943 units. Ford has experienced a slow ramp-up of the all-new F-150, which started sales in March.

Updated guidance will also be key to Ford’s stock performance. In late March, Ford CFO John Lawler reiterated 2024 guidance that Ford provided in early February, projecting adjusted earnings before interest and taxes (EBIT) of $10 billion to $12 billion, adjusted free cash flow of $6 billion to $7 billion, and capital expenditures of $8 billion to $9.5 billion.

Investors and analysts will likely require Ford to boost its full-year profit guidance following a similar move by GM. GM now sees full-year adjusted EBIT of $12.5 billion-$14.5 billion, up from prior outlook of $12 billion-$14 billion.

Pras Subramanian is a reporter for Yahoo Finance. You can follow him on Twitter and on Instagram.

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