10-QPeriod: Q2 FY2024

FORD MOTOR CO Quarterly Report for Q2 Ended Jun 30, 2024

Filed July 25, 2024For Securities:FF-PCF-PDF-PB

Summary

Ford Motor Company reported a mixed financial performance for the second quarter and first half of 2024. Total revenues saw an increase year-over-year, driven by higher sales in the Ford Pro segment and some recovery in Ford Blue. However, net income and adjusted EBIT declined due to significant cost pressures, particularly in the Ford Blue segment, and continued losses in the Ford Model e segment. The company is navigating a challenging electric vehicle market characterized by slower-than-anticipated adoption and pricing pressures, leading to a projected substantial loss for Ford Model e in 2024. Conversely, the Ford Pro segment continues to demonstrate robust growth and profitability. Ford Credit also reported increased net receivables and solid EBT, though with a slightly higher loss-to-receivables ratio and lower auction values. The company is actively managing its costs and investments, particularly in its EV strategy, while maintaining a strong liquidity position.

Financial Highlights

50 data points
Beta

Revenue

$47.81B

15.3% Gross Margin

Net Income

$1.83B

3.8% Net Margin

EPS (Diluted)

$0.46

Total Assets

$276.59B

Cash & Equivalents

$20.23B

Free Cash Flow

$5.51B

Financial Statements
Beta
Revenue$47.81B
Cost of Revenue$40.49B
Gross Profit$7.32B
SG&A Expenses$2.68B
Operating Expenses$45.92B
Operating Income$1.88B
Net Income$1.83B
EPS (Basic)$0.46
EPS (Diluted)$0.46
Shares Outstanding (Basic)3.98B
Shares Outstanding (Diluted)4.02B

Key Highlights

  • 1Total revenues increased by 6% to $47.8 billion in Q2 2024 and by 5% to $90.6 billion in the first half of 2024, compared to the prior year.
  • 2Net income attributable to Ford Motor Company decreased to $1.83 billion in Q2 2024 from $1.92 billion in Q2 2023, and fell to $3.16 billion in the first half of 2024 from $3.67 billion.
  • 3Company Adjusted EBIT saw a significant decline, down to $2.76 billion in Q2 2024 from $3.79 billion in Q2 2023, and down to $5.52 billion in the first half of 2024 from $7.17 billion.
  • 4Ford Blue segment EBIT decreased substantially by $1.14 billion year-over-year in Q2 2024, primarily due to higher warranty and material costs.
  • 5Ford Model e segment continued to report losses, with an EBIT loss of $1.14 billion in Q2 2024, a slight increase from $1.08 billion in the prior year, impacted by lower pricing and volumes.
  • 6Ford Pro segment demonstrated strong performance, with EBIT increasing by $173 million to $2.56 billion in Q2 2024, driven by higher volume and favorable mix.
  • 7Ford Credit reported total net receivables of $137.7 billion at June 30, 2024, up from $126.1 billion at June 30, 2023, with EBT of $343 million in Q2 2024, down from $390 million in Q2 2023.

Frequently Asked Questions

Ford Motor Company reported an increase in total revenues for both the second quarter and the first half of 2024 compared to the prior year. However, net income and adjusted EBIT have declined. This is primarily due to significant cost pressures in the Ford Blue segment and ongoing losses in the Ford Model e segment, despite strong performance in Ford Pro and increased receivables at Ford Credit.

Ford is experiencing lower-than-anticipated EV adoption rates and pricing pressures, which has led to a projected substantial EBIT loss for the Ford Model e segment in 2024. The company is adjusting its spending, production, and product launches to better match EV demand and has incurred expenses related to regulatory compliance credits and supplier payments. Despite these challenges, Ford continues to invest in its EV strategy and battery production.

Ford Pro is expected to continue its strong performance with projected EBIT of $9 billion to $10 billion for 2024, driven by sustained growth and favorable mix. Ford Blue's EBIT is projected between $6 billion to $6.5 billion, reflecting cost efficiencies offset by increased product, manufacturing, and warranty costs. Ford Model e is anticipated to incur an EBIT loss of $5 billion to $5.5 billion in 2024 due to pricing pressures and EV investments. Ford Credit's EBT is expected to be around $1.5 billion for the full year.

Ford maintains a strong liquidity position, with total balance sheet cash, cash equivalents, marketable securities, and restricted cash at $34.8 billion as of June 30, 2024. The company targets an ongoing Company cash balance of at least $20 billion, plus significant additional liquidity. Company adjusted free cash flow was $3.2 billion in Q2 2024, and full-year 2024 capital spending is projected between $8 billion to $9 billion.