Shares of Ford are lower by about 6% in the pre-market session this morning after the company reported fourth quarter earnings that missed estimates on Thursday and failed to garner the praise of sell side analysts.
The company reported 2022 earnings of $10.4 billion after guiding to $11.5 billion to $12.5 billion. "Poor execution" and "higher costs" were to blame for the drastic miss, which had been reaffirmed just weeks prior to the Q4 report coming out.
The company reported Q4 EPS of $0.51 adjusted versus estimates of $0.62 adjusted. On revenue, 4th quarter beat expectations coming in at $41.8 billion versus $40.37 billion estimated. EBITDA adjusted margins were 9.7%, under Wall Street's best case expectations of around 10%.
CEO Jim Farley said in the company's press release: “I’m excited about 2023, which is pivotal for us. We’ve got clarity and ambition with the Ford+ plan, a strong team carrying it out, and a lineup of great products and customer experiences that’s getting even better.
“We should have done much better last year. We left about $2 billion in profits on the table that were within our control, and we’re going to correct that with improved execution and performance," he continued.
Despite the miss, the company heralded some of its achievements for the year as well:
CEO Jim Farley told CNBC on Thursday: “We have to change our cost profile. We know what we have to go after. I’d love to give you all the metrics and all the specific gaps we see. But you know, whether it’s absenteeism, the number of sequencing centers, the number of wiring harnesses we have, we know what it is.”
He continued; “We have a lot of complexity relative to the customer and also inside our company. And we can cut the customer-facing complexity like we have, but it takes time to work that down to parts on the line, to the manufacturing line. It just takes time to work through that and that’s what we’ll do.”
“I can’t wait to show you and the whole world this next cycle of products. Many of our competitors are just coming out with their first cycle and we can see their batteries are too big. Their distribution costs are too expensive. They’re spending too much money on advertising. You know, we can’t do that. We don’t plan on doing that.”
Other analysts also weighed in with their take on Friday morning, from Bloomberg:
Deutsche Bank, Emannuel Rosner (downgrades to sell)
Citi, Itay Michaeli (neutral)
Jefferies, Philippe Houchois (hold)