Summary
Ford Motor Company reported a net loss of $827 million for the third quarter of 2022, a significant shift from the net income of $1,832 million in the same period last year. This loss was largely driven by a substantial $2.7 billion pre-tax impairment charge related to its investment in Argo AI, reflecting a strategic pivot away from Level 4 autonomous driving technology. Despite the net loss, the company's total revenues increased to $39.4 billion, up from $35.7 billion in Q3 2021, primarily due to higher automotive sales and improved pricing, partially offset by weaker currency exchange rates. Adjusted EBIT, a non-GAAP measure that excludes special items like the Argo AI impairment, was $1.8 billion, down from $3.0 billion in the prior year. The decline in adjusted EBIT was primarily attributed to increased commodity, material, and freight costs, along with unfavorable mix and weaker currencies impacting the Automotive segment. Ford Credit also saw a decrease in earnings before taxes (EBT) due to lower lease residual gains and financing margin. The company continues to navigate supply chain challenges, inflation, and rising interest rates. However, positive factors include robust demand for new products, strong pricing power, and a significant improvement in wholesale units and revenue in the Automotive segment, especially in North America and Europe.
Financial Highlights
51 data points| Revenue | $39.39B |
| Cost of Revenue | $34.35B |
| Gross Profit | $5.04B |
| SG&A Expenses | $2.85B |
| Operating Expenses | $38.89B |
| Operating Income | $504.00M |
| Net Income | -$827.00M |
| EPS (Basic) | $-0.21 |
| EPS (Diluted) | $-0.21 |
| Shares Outstanding (Basic) | 4.02B |
| Shares Outstanding (Diluted) | 4.02B |
Key Highlights
- 1Net loss of $827 million in Q3 2022, compared to a net income of $1,832 million in Q3 2021, primarily due to a $2.7 billion impairment charge on the Argo AI investment.
- 2Total revenues increased 10% year-over-year to $39.4 billion in Q3 2022, driven by higher Automotive sales and pricing.
- 3Company Adjusted EBIT decreased to $1.8 billion from $3.0 billion year-over-year, impacted by higher costs and unfavorable mix in the Automotive segment.
- 4Automotive segment EBIT decreased to $1.7 billion from $2.5 billion year-over-year, despite a 7% increase in wholesales, due to increased commodity, material, and freight costs.
- 5Ford Credit's EBT decreased by $478 million year-over-year to $599 million, primarily due to lower lease residual gains and unfavorable financing margin.
- 6Company cash stood at $32.0 billion and liquidity at $49.2 billion as of September 30, 2022, demonstrating a strong liquidity position.
- 7Full-year 2022 guidance for Adjusted EBIT was revised to about $11.5 billion, with expected Adjusted Free Cash Flow between $9.5 billion and $10.0 billion.