Ford guides to low end of 2024 earnings forecast as it slightly tops Wall Street's third-quarter expectations
DETROIT — Ford Motor guided to the low end of its previously announced 2024 earnings forecast as it slightly topped Wall Street's third-quarter expectations.
The Detroit automaker said Monday it now expects adjusted earnings before interest and taxes, or EBIT, of about $10 billion. It had previously guided to between $10 billion and $12 billion. It retained its forecast for adjusted free cash flow of between $7.5 billion and $8.5 billion.
Heading into Monday's results, several Wall Street analysts were concerned Ford would need to lower its forecast due to softening demand, rising vehicle inventory levels and worries about Ford's ability to achieve an announced $2 billion in cost cuts this year.
"Our focus continues on cost and quality, which are holding back our progress and represent tremendous upside potential," Ford CFO and Vice Chair John Lawler said Monday during a media briefing.
Lawler said Ford has achieved its $2 billion in material, freight and manufacturing costs, but higher inflationary and warranty costs have eaten into those improvements and have restricted the company "from having a record year."
Here's how the company performed in the third quarter, compared with average estimates compiled by LSEG:
Shares of the automaker were down by roughly 5% during after-hours trading after closing Monday at $11.37, up 2.7%.
The automaker was under pressure after a disappointing second quarter in which unexpected warranty costs caused the company to miss Wall Street's earnings expectations.
Lawler said the company's warranty costs in the third quarter were slightly lower than they were a year earlier after increasing by $800 million year over year during the second quarter.
"It's an improvement, but it's not as big as we