Ford Motor (F) earnings Q4 2024

DETROIT — Ford Motor beat Wall Street’s top- and bottom-line expectations for the fourth quarter but forecast a tougher year ahead for the company, as CEO Jim Farley promises improvements in vehicle quality and costs.

Shares of Ford fell 5% in after-hours trading.

Ford’s forecast this year calls for adjusted earnings before interest and taxes (EBIT) of $7 billion to $8.5 billion; adjusted free cash flow of $3.5 billion to $4.5 billion; and capital expenditures of between $8 billion to $9 billion.

For 2024, Ford reported adjusted EBIT of $10.2 billion, or $1.84 adjusted earnings per share, and net income of $5.9 billion, or $1.46 EPS. The automaker reported total revenue, including its financial arm, was a company record of $185 billion and adjusted free cash flow was $6.7 billion.

“We think it’s prudent. There’s a lot of external factors … but our future is really in our hands,” Farley said Wednesday during CNBC’s “Closing Bell” on the cautionary guidance. 

Here’s how the company performed in the fourth quarter, compared with average estimates compiled by LSEG:

• Earnings per share: 39 cents adjusted vs. 33 cents expected
• Automotive revenue: $44.9 billion vs. $43.02 billion expected

The company said its 2025 guidance, which is in line with or lower than many analyst expectations, “presumes headwinds related to market factors.” They include 2% industry lower pricing and slightly lower wholesales for Ford but not additional tariffs by the Trump administration.

“Given the pause in the current tariff situation, specifically in Mexico and Canada, we are not choosing to take any actions at this time,” Ford CFO Sherry House told media Wednesday during a call. “We’re going to let this run itself out so we can better understand the potential impacts on our business.”

House said this year’s forecast also takes into account expectations of a $1 billion reduction in material and warranty costs compared with last year. This follows $1.4 billion in cost reductions in 2024, which were largely offset by unexpected quality and warranty costs.

The first half of 2025 is expected to be weaker than the backend. That includes first-quarter adjusted EBIT that is projected to be roughly breakeven due to lower wholesales and less profitable vehicles being produced, including launch activity at major U.S. assembly plants in Kentucky and Michigan.

For the fourth quarter of 2024, Ford reported net income of $1.8 billion, or 45 cents per share, compared with a net loss of $526 million, or a loss of 13 cents per share, a year earlier. Adjusting for one-time items, the company reported earnings per share of 39 cents.

Ford’s traditional “Blue” operations and “Pro” fleet businesses carried the automaker to profitability, as its “Model e” EV business lost $5.08 billion in 2024, including $1.39 billion during the fourth quarter.

Its Blue business, which includes internal combustion engine vehicles, earned $5.28 billion in 2024, a nearly $2.2 billion decrease from the year before. Pro earned more than $9 billion last year, including $1.63 billion in the fourth quarter.

For 2025, Ford is forecasting EBIT of $7.5 billion to $8 billion from Ford Pro; $3.5 billion to $4 billion for Ford Blue; and a loss of $5 billion to $5.5 billion for Ford Model e. Its Ford Credit arm is expected to post earnings of $2 billion.

Ford was under pressure to perform after crosstown rival General Motors easily topped Wall Street’s fourth-quarter expectations and said its 2025 guidance is in line with or above analysts’ expectations.

Ford underperformed expectations last year largely due to unexpected warranty and recall problems plaguing the company’s earnings. Shares of the automaker declined nearly 20% in 2024 amid the problems, which Farley has promised to rectify.