EV loss drags down Ford’s second-quarter profit

A loss before interest and taxes dragged down Ford’s second-quarter net profit, missing analysts’ expectations despite revenue growth.

The company reported revenue of $47.8 billion for the period, up 6% from the same quarter last year, and net income of $1.8 billion on earnings before interest and tax of $2.8 billion.

Even more interesting is the breakdown of the financial data by segment, after Ford divided its business into three parts: Ford Blue, which deals with the gasoline-powered passenger car line, Ford Model e, which deals with electric vehicles, and Ford Pro, which deals with the commercial vehicle and truck business.

Ford Blue reported revenue growth of 3% to $26.7 billion in the second quarter, with earnings before interest and taxes of $1.17 billion. The unit had an EBIT margin of 4.4%, down 4.8 percentage points from a year earlier.

Ford Pro also performed well, reporting a 3% increase in revenue to $17 billion in the second quarter of 2024, and EBIT rising $173 million over the year to $2.56 billion. The unit boasted an EBIT margin of 15.1% in the period.

Things didn’t look so good in the electric vehicle segment, however. Revenues came in at $1.1 billion, down 37% from the segment’s revenues in Q2 2023. Earnings before interest and taxes were negative $1.143 billion, and EBIT margins were negative 99.5%. The segment’s total loss for the full year is $5.5 billion.

Ford expects to book adjusted EBIT of $10 billion to $12 billion for the full year, another disappointment for investors because it represents no change from its previous profit forecast. However, the company raised its free cash flow forecast by $1 billion to $7.5 billion to $8.5 billion.

By Irina Slav for Oilprice.com

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