Ford released its second-quarter earnings today, revealing a mix of positive revenue growth and missed earnings expectations. Despite revenue climbing 6% to $44.8 billion, surpassing projections, Ford’s Q2 2024 earnings per share (EPS) fell short at $0.47 versus the expected $0.64. The company’s overall revenue, including its finance unit, reached $47.81 billion, while net income was $1.8 billion.
EV sales have shown remarkable growth for Ford, surging 61% year-over-year in Q2 2024. Ford sold nearly 23,957 EVs in the quarter, maintaining its position as the second best-selling EV maker in the U.S. behind Tesla and outpacing rival GM, which sold 21,930 electric models. Notable performance was seen in the F-150 Lightning, with sales up 77% to 7,902 units, and the Mustang Mach-E, with sales increasing 46.5% to 12,645 units. The E-Transit van also saw a significant rise, with sales surging 95.5% to 3,410 units.
However, Ford has adjusted its EV strategy due to “slower-than-expected” demand, cutting back on F-150 Lightning production and delaying around $12 billion in EV spending. The company plans to build more Super Duty trucks at its EV plant in Ontario and is pivoting towards hybrids, which saw a 55.6% sales increase in Q2.
Ford’s commercial and software unit, Ford Pro, was a key growth driver, with revenue up 9% to $17 billion and a substantial EBIT margin of 15.1%. The unit posted Q2 EBIT of $2.6 billion and noted profitability in every region it operates. Ford Pro software subscriptions increased by 35% in the quarter, and mobile repair orders more than doubled. CEO Jim Farley emphasized commercial customers’ early adoption of new technology, including connected and EVs.
Despite these positive developments, Ford’s Model E unit faced challenges, losing $1.1 billion in the second quarter, with revenue falling to $1.3 billion and volume down 23%. EV losses totaled $2.5 billion for the first half of 2024 due to lower volume and industry-wide pricing pressure. Ford still expects its Model E EV business to lose between $5.0 and $5.5 billion this year.
Ford’s ICE business, Ford Blue, saw modest gains, with volume and revenue rising 3% and 7%, respectively. Full-year EBIT guidance remains unchanged at $10 to $12 billion, while adjusted free cash flow expectations have been raised by $1 billion, ranging from $7.5 to $8.5 billion.
On the earnings call, Farley stressed Ford’s focus on smaller, more profitable EVs to compete with Tesla and low-cost Chinese competitors like BYD. He highlighted the development of a new platform by a “skunkworks” team in Long Beach as central to Ford’s revised EV strategy aimed at achieving profitability. Farley also hinted at potential partnerships in the EV space, suggesting more announcements to come.
