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Ford (F) Misses on Q3 Earnings, Withdraws 2023 Guidance
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Ford (F - Free Report) reported adjusted earnings of 39 cents per share for third-quarter 2023, which missed the Zacks Consensus Estimate of 40 cents but increased from 30 cents recorded in the year-ago quarter. The company’s consolidated third-quarter revenues came in at $43,801 million, rising 11.2% year over year.
The U.S. legacy automaker reports its automotive results under three business segments — Ford Model e, Ford Blue and Ford Pro. While Ford Blue focuses on the firm’s legacy gas-powered business, Ford Model e focuses on EVs, advanced technologies and several related aspects to support electrification plans. Ford Pro deals with commercial vehicles and services.
In the third quarter, total wholesale volume in the Ford Blue segment decreased 1% year over year to 736,000 units and also fell short of our forecast of 750,000 units. However, revenues from the segment increased 7% year over year to $25.6 billion and topped our estimate of $23.8 billion on better-than-expected pricing. Earnings before interest and taxes came in at $1,718 million with an EBIT margin of 6.7%. EBIT exceeded our projection of $1,557 million thanks to the company’s cost-containment efforts and higher-than-expected revenues.
Total wholesale volume in the Ford Model e segment increased 44% year over year to 36,000 units. Revenues from the segment rose 26% year over year to $1.8 billion. Loss before interest and taxes widened to $1,380 million with an EBIT margin of negative 75.6% amid high costs in the development of technologically advanced products.
Total wholesale volume in the Ford Pro segment decreased 2% year over year to 314,000 and missed our expectation of 382,000 units. However, revenues from the segment grew 16% year over year to $13.8 billion and beat our expectations of $11.8 billion. Earnings before interest and taxes came in at $1,654 million with an EBIT margin of 12%.
Overall, Ford’s total automotive revenues came in at around $41,176 million, surpassing our estimate of $36,588 million on stronger-than-expected results from Ford Blue and Ford Pro units.
Second-quarter revenues from the Ford Credit unit came in at $2,625 million, up 20% year over year. Pretax earnings totaled $358 million, falling from $589 million in the year-ago quarter. Reduced financing margin, the absence of gains in derivative market valuations and a decrease in the residual values of leased vehicles adversely impacted the results.
Financial Position
Ford reported adjusted free cash flow of $1,225 million for the quarter. It had cash and cash equivalents of $26,427 million as of Sep 30, 2023. Long-term debt, excluding Ford Credit, totaled $19.33 billion at the end of the third quarter of 2023.
Despite a tentative agreement with the United Auto Workers, the strike brought uncertainty to Ford’s fiscal year results. Given the extent of its influence and the pending ratification of the agreement, Ford withdrew its full-year 2023 guidance.
The Zacks Consensus Estimate for TM’s fiscal 2024 sales and EPS implies year-over-year growth of 10.5% and 27.5%, respectively. The earnings estimate for fiscal 2024 and 2025 has been revised upward by 18 cents and 37 cents, respectively, in the past seven days.
The Zacks Consensus Estimate for HMC’s fiscal 2024 sales and EPS implies year-over-year growth of 7.7% and 27.7%, respectively. The earnings estimate for fiscal 2025 has been revised upward by 5 cents in the past seven days.
The Zacks Consensus Estimate for NSANY’s fiscal 2024 EPS implies year-over-year growth of 12.6%. The earnings estimate for fiscal 2024 and 2025 has been revised upward by 10 cents and 3 cents, respectively, in the past seven days.
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Ford (F) Misses on Q3 Earnings, Withdraws 2023 Guidance
Ford (F - Free Report) reported adjusted earnings of 39 cents per share for third-quarter 2023, which missed the Zacks Consensus Estimate of 40 cents but increased from 30 cents recorded in the year-ago quarter. The company’s consolidated third-quarter revenues came in at $43,801 million, rising 11.2% year over year.
Ford currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Ford Motor Company Price, Consensus and EPS Surprise
Ford Motor Company price-consensus-eps-surprise-chart | Ford Motor Company Quote
Segmental Performance
The U.S. legacy automaker reports its automotive results under three business segments — Ford Model e, Ford Blue and Ford Pro. While Ford Blue focuses on the firm’s legacy gas-powered business, Ford Model e focuses on EVs, advanced technologies and several related aspects to support electrification plans. Ford Pro deals with commercial vehicles and services.
In the third quarter, total wholesale volume in the Ford Blue segment decreased 1% year over year to 736,000 units and also fell short of our forecast of 750,000 units. However, revenues from the segment increased 7% year over year to $25.6 billion and topped our estimate of $23.8 billion on better-than-expected pricing. Earnings before interest and taxes came in at $1,718 million with an EBIT margin of 6.7%. EBIT exceeded our projection of $1,557 million thanks to the company’s cost-containment efforts and higher-than-expected revenues.
Total wholesale volume in the Ford Model e segment increased 44% year over year to 36,000 units. Revenues from the segment rose 26% year over year to $1.8 billion. Loss before interest and taxes widened to $1,380 million with an EBIT margin of negative 75.6% amid high costs in the development of technologically advanced products.
Total wholesale volume in the Ford Pro segment decreased 2% year over year to 314,000 and missed our expectation of 382,000 units. However, revenues from the segment grew 16% year over year to $13.8 billion and beat our expectations of $11.8 billion. Earnings before interest and taxes came in at $1,654 million with an EBIT margin of 12%.
Overall, Ford’s total automotive revenues came in at around $41,176 million, surpassing our estimate of $36,588 million on stronger-than-expected results from Ford Blue and Ford Pro units.
Second-quarter revenues from the Ford Credit unit came in at $2,625 million, up 20% year over year. Pretax earnings totaled $358 million, falling from $589 million in the year-ago quarter. Reduced financing margin, the absence of gains in derivative market valuations and a decrease in the residual values of leased vehicles adversely impacted the results.
Financial Position
Ford reported adjusted free cash flow of $1,225 million for the quarter. It had cash and cash equivalents of $26,427 million as of Sep 30, 2023. Long-term debt, excluding Ford Credit, totaled $19.33 billion at the end of the third quarter of 2023.
Despite a tentative agreement with the United Auto Workers, the strike brought uncertainty to Ford’s fiscal year results. Given the extent of its influence and the pending ratification of the agreement, Ford withdrew its full-year 2023 guidance.
Zacks Rank & Key Picks
Ford currently carries a Zacks Rank #3 (Hold).
A few top-ranked players in the auto space include Toyota (TM - Free Report) , Honda (HMC - Free Report) and Nissan (NSANY - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for TM’s fiscal 2024 sales and EPS implies year-over-year growth of 10.5% and 27.5%, respectively. The earnings estimate for fiscal 2024 and 2025 has been revised upward by 18 cents and 37 cents, respectively, in the past seven days.
The Zacks Consensus Estimate for HMC’s fiscal 2024 sales and EPS implies year-over-year growth of 7.7% and 27.7%, respectively. The earnings estimate for fiscal 2025 has been revised upward by 5 cents in the past seven days.
The Zacks Consensus Estimate for NSANY’s fiscal 2024 EPS implies year-over-year growth of 12.6%. The earnings estimate for fiscal 2024 and 2025 has been revised upward by 10 cents and 3 cents, respectively, in the past seven days.