Ford shares down as it fires EV warning shot into the headlights
While Ford Motor raised its 2023 profit guidance along with a significant beat on its second quarter earnings, it warned that losses in its electric vehicle division will continue.
It delivered an adjusted earnings per share of 72 cents against an expectation of 55 cents and saw automotive revenues of $42.43 billion on forecasts of $40.38 billion. Strong pricing and demand for the automaker's trucks were the main motor behind the numbers, but shares fell almost 1% after it warned that its determination to compete in the burgeoning EV market will see losses in that division continue.
(Video Transcript)
Ford Motor
Ford Motor has raised its guidance for 2023, along with a significant beat on its second quarter earnings, but as we'll see in just a minute, Shares ended down on the session. Let’s take a look at the figures as we saw them come through. Adjusted earnings per share were $0.72 against $0.55 expected automotive revenue, which is in line with the share of the business at 42.43 billion. We've been looking for 40.38.
Earnings forecast
Strong pricing and demand from the automaker's trucks were the main drivers behind the numbers. The company is also increasing its full year adjusted earnings forecast to range between 11 and $12 billion, up from the prior 9 to 11 billion. It also increased its expected adjusted free cash flow from $6 to $6 and a half billion.
But if we look at what happened on the markets in the session late in the trading day yesterday, the stock was on the way down. But losing almost 1%. And in fact, at one point, despite the fact that we saw a big rise in shares late last night from those earnings, the statement came through and people realised what was going on.
Share outlook
Shares are falling because of losses in the electric vehicle section of the business. And the company says it wants to remain competitive. It wants to keep prices low. It wants more people to adopt Ford over other automakers to put a lot more Ford Electric vehicles on the market. And they're paying the price. And the shares ended down as a result.
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