Key Points

• Q4 adjusted earnings: 29 cents
• Revenue from cars: $43.2B
• Special dividend: 18 cents

In addition to projecting better-than-expected performance for 2024, Ford Motor exceeded Wall Street's top- and bottom-line estimates for the fourth quarter.

The business has projected adjusted free cash flow of $6 billion to $7 billion, capital expenditures of $8 billion to $9.5 billion, and adjusted earnings before interest and taxes, or EBIT, of between $10 billion and $12 billion for the entire year.

Many analysts' investor notes state that they had anticipated Ford's adjusted earnings projection to be between $9 billion and $11 billion.

In addition to the ordinary dividend of 15 cents per share for the first quarter, the automaker also declared a special payout of 18 cents per share. To shareholders of record as of the close of business on February 16th, the dividends are payable on March 1st.

Ford's stock increased by about 6% in after-hours trading to settle at $12.07, up 4.1% during Tuesday's trade.

The following represents Ford's performance in the fourth quarter vs Wall Street's expectations, derived from average forecasts provided by LSEG (previously Refinitiv):

• Profits: 29 cents adjusted per share as opposed to the anticipated 14 cents per share
• Revenue from cars: $43.2 billion as opposed to the projected $40.12 billion

Ford CEO Jim Farley referred to the previous year as the company's "foundational year," highlighting a number of cost reductions, the high gross margin on its hands-free BlueCruise highway system, and the company's 40% sales growth prediction for hybrid vehicles.

Farley addressed investors on Tuesday, saying, "It was a solid year, but I want to be really clear we are nowhere near our earnings potential for Ford Motor Co." "This year, we are really well-positioned for growth, profitability, and revenues as well."

Ford had a net loss of $526 million, or 13 cents per share, for the fourth quarter of this year, as opposed to a profit of $1.29 billion, or 32 cents per share, for the same period last year. After deducting one-time expenses, the business declared 29 cents in earnings per share.

From roughly $44 billion in revenue a year earlier to $46 billion throughout the period, overall revenue grew by roughly 4%. At $1.05 billion, adjusted EBIT decreased 59% from the same time last year.

Ford Blue, the company's core business, saw adjusted earnings of $813 million in the fourth quarter of 2018, a decrease of almost 48% from the same period the previous year. $1.81 billion was made by its Ford Pro commercial division, a 25% increase over the previous year. From October to December, Ford's Model e electric vehicle division reported a $1.57 billion loss, more than tripling its deficit from the fourth quarter of 2022 ($631 million).

Ford reported adjusted EBIT of $10.42 billion for the full year 2023, which was unchanged from 2022; sales of $176.2 billion, up 11% from the previous year; and adjusted free cash flow of $6.8 billion, down $2.3 billion from the previous year. After losing $2.15 billion in 2022, net income increased to $4.33 billion in 2023.

The company's fleet and traditional businesses helped to counterbalance the $4.7 billion in losses incurred by its electric vehicle division.

In November, Ford revised down its full-year estimate due to ongoing contract talks with the United Auto Workers union.

According to Ford's Chief Financial Officer John Lawler, the firm is still searching for methods to reduce rising labor expenses brought on by the new UAW contract, which will likely cost $8.8 billion when it expires in April 2028. Ford has already made plans to reduce or postpone investments in a number of electric vehicle offerings.

"Our EV teams are intensely focused on cost and efficiency in our products because the Chinese [automakers] and the more affordable Tesla will be our main competitors," Farley stated.

This year, Ford is anticipated to have challenges such as decreased car prices, increased warranty expenses, and sustained losses from all-electric vehicles. The Ford Pro fleet division and the classic Ford Blue internal combustion engine business are anticipated to be strong points.