Ford Motor Co. reported a narrower-than-expected adjusted loss in the second quarter on Thursday night, with sales halved compared to the previous year, but in line with Wall Street forecasts.
Ford F,
He said he made $ 1.1 billion, or 28 cents a share, in the quarter, including a $ 3.5 billion gain on investments in Argo AI, and compared to earnings of 4 cents a share in the same period a year ago. .
Adjusted for one-off items, the company lost 35 cents a share in the quarter, compared to an adjusted profit of 28 cents a share a year ago. Revenue fell 50% to $ 19.4 billion from $ 38.9 billion a year ago.
Analysts surveyed by FactSet expected Ford to report an adjusted loss of $ 1.17 per share on sales of $ 19.4 billion.
Ford’s shares rose nearly 4% in off-hours trading as the company also sought to allay any concerns about its liquidity and said it remained focused on autonomous and electric vehicles. The stock trimmed gains as the extended session progressed.
The adjusted second-quarter loss “was not as steep as the street had anticipated,” said Garrett Nelson, a CFRA analyst.
“From our perspective, the most positive was the guidance for third quarter adjusted EBIT” between $ 500 million and $ 1.5 billion, which is ahead of the current consensus of $ 477 million “and implies a significant improvement in the loss of the second quarter of $ 1.95 billion. “
However, Nelson cautioned that while the results were “solid,” Ford’s shares have already rebounded sharply from their March lows, “and the company remains in the midst of a costly multi-year restructuring.
“Also, we don’t see Ford’s sales returning to pre-pandemic levels any time soon, but we believe the buzz surrounding the Bronco and Mustang Mach-E is positive.”
In a call with analysts after the results, Chief Executive Jim Hackett said the newly revealed new Bronco has been received with great enthusiasm, and the vehicle’s stock at 150,000 has exceeded even the “most optimistic initial projections of the company”. . ”
Hackett said he feels “better and better” about the company’s decision to focus on SUVs and trucks rather than sedans two years ago. It was a controversial move at the time, but it was worth it, he said.
Ford delivered “a strong Q2 while staying safe, caring for customers and neighbors and securing tomorrow,” Hackett said in a statement before the call.
Ford highlighted “further progress” in moves to cut costs and capital expenditures and said it closed the deal with Volkwagen AG VOW,
for commercial vehicles, electric vehicles and trucks.
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The automaker said it had more than $ 39 billion in cash at the end of the quarter, in part due to $ 10 billion in new debt over the three-month period, and this week it repaid $ 7.7 billion against lines of credit. renewable.
“The company’s current liquidity of nearly $ 40 billion is expected to be sufficient to maintain or exceed a target cash balance of $ 20 billion during the second half of this year, even if global demand declines or there is another wave. of plant closures related to the pandemic. ” Ford said in a statement.
Ford’s earnings come as Tesla Inc. TSLA,
and General Motors Co. GM,
reported better-than-expected second-quarter earnings.
GM earlier this week reported a narrower-than-expected loss primarily in sales of its trucks, and said nearly all of its U.S. factories are operating at pre-pandemic levels.
Last week, Tesla reported a surprise quarterly profit, putting the shares on a course to join the S&P 500 index.
Ford shares have lost 28% so far this year, compared to losses of about 8% for the DIA Jones Industrial Average DJIA,
and in contrast to gains of around 0.4% for the S&P 500 SPX index,
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