Ford stock surged in after-hours trading following the release of fourth-quarter sales that exceeded expectations and a full-year profit outlook that outperformed estimates. Despite predicting further losses for its EV unit, Ford reported better-than-expected results, with top-line revenue of $46 billion, beating Bloomberg’s estimate by $2 billion, and adjusted earnings per share of $0.29, compared to the estimated $0.13. Ford’s projections for adjusted EBIT for 2024 exceeded estimates and the company reinstated its 2023 profit outlook following the ratification of its labor deal with the United Auto Workers. The announcement of a regular dividend and supplemental dividend for the first quarter, as well as plans to improve capital efficiency, further fueled the stock’s rise.
Ford’s performance in its various business units, particularly the Ford Model e EV division, was under scrutiny, with the company projecting a wider loss of $5 billion to $5.5 billion for 2024, indicating ongoing struggles in the increasingly competitive EV market. Moreover, Ford’s sales of EVs declined, especially for the Mustang Mach-E, following the loss of federal EV tax credit eligibility. The company emphasized its commitment to developing next-gen EVs that will be profitable and announced investments in the production of smaller EV products. Despite challenges, Ford’s overall strength in 2023, as indicated by a 7.1% increase in US total sales, bodes well for the company’s future, especially as it continues to innovate and adapt to evolving market demands.
Amid ongoing challenges in its EV division, Ford’s impressive sales performance in various segments, its commitment to improving capital efficiency, and the announcement of dividends indicate a positive outlook for the automaker. Despite ongoing losses in the EV division, Ford’s overall strength in its traditional gas-powered business and commercial truck line demonstrates resilience and adaptability in an ever-changing market. With its focus on developing profitable next-gen EVs and increasing hybrid sales, Ford is positioning itself to maintain or even amplify its performance in the coming years.