Ford Motor to Report Earnings After Bell in 2023: Wall Street’s Expectations.
Ford Motor is set to announce its second-quarter earnings after the market closes on Thursday. Analysts predict that the results will be solid, although less robust than those reported by their rival, General Motors, on Tuesday.
According to average estimates compiled by Refinitiv, Wall Street expects Ford to report adjusted earnings per share of 55 cents and automotive revenue of $40.38 billion.
Compared to previous year, the results indicate a 6.5% increase in automotive revenue but a significant 20% decline in adjusted earnings per share. The company’s profits in the previous year’s second quarter were bolstered by high vehicle prices resulting from lower inventory levels.
In second quarter of 2022, Ford reported a net income of $667 million on total revenue of $40.19 billion. However, there is pressure on Ford to perform well following General Motors’ decision to raise its yearly guidance for the second time this year.
Ford has previously stated its expectations for full-year adjusted earnings to be between $9 billion and $11 billion, with approximately $6 billion in adjusted free cash flow. Additionally, the automaker has plans for capital expenditures of between $8 billion and $9 billion in 2023.
Recently, Ford changed its financial reporting structure, providing results by business unit rather than by region. This move came with the release of revised results for 2021 and 2022 following the new reporting approach.
One significant area of interest for investors is Ford’s “Model E” electric vehicle business, which reported losses of $2.1 billion in operating expenses last year and $722 million in the first quarter of this year, reflecting a more comprehensive loss compared to previous year due to increased EV production.
To boost sales and production of its F-150 Lightning pickup, Ford reduced pricing by up to $10,000.
Despite this move, some Wall Street analysts criticized General Motors for its slow rollout of electric vehicles and raised questions about the automaker’s EV strategy, pricing, sales targets, and its decision to revive the Chevy Bolt after announcing its discontinuation.
Morgan Stanley analyst Adam Jonas believes both GM and Ford face challenges in on-shoring advanced EV battery technology profitably and at scale. This indicates that Ford may also face scrutiny over its own EV investment strategy.
Another area of concern is the upcoming contract negotiations with the UAW union. The talks, expected to be contentious, have drawn attention due to the yearslong national labour movement, new union leadership, and record company profits.
Talks began earlier in the month between the UAW and GM, Ford, and Stellantis. The current contracts are set to expire on September 14 and cover approximately 150,000 UAW members working for the automakers.
As investors eagerly await Ford’s second-quarter earnings report, the company’s performance and insights into its EV strategy and UAW negotiations will be closely scrutinized. Wall Street will be keep a close eye on whether Ford can deliver solid results amid industry challenges and fierce competition.
