Ford Motor Company surpassed Wall Street's top- and bottom-line expectations for the fourth quarter of 2024. The automaker reported a net income of $1.8 billion, or 45 cents per share, marking a significant turnaround from a net loss of $526 million, or 13 cents per share, in the same period last year. The company achieved a record-breaking total revenue of $185 billion, including contributions from its financial arm.
Despite these promising results, Ford anticipates a more challenging 2025. The company has forecasted adjusted earnings before interest and taxes (EBIT) between $7 billion and $8.5 billion, influenced by anticipated headwinds from market factors such as 2% lower industry pricing and slower sales. These forecasts do not account for potential additional tariffs by the Trump administration.
For 2024, Ford reported an adjusted EBIT of $10.2 billion and an adjusted earnings per share (EPS) of $1.84. Net income reached $5.9 billion, or $1.46 EPS, as the company managed to reduce costs by $1.4 billion. Ford's adjusted free cash flow is projected to be between $3.5 billion and $4.5 billion, with expected capital expenditures ranging from $8 billion to $9 billion in the coming year.
The automaker's stock declined nearly 20% in 2024, largely due to unexpected warranty and recall issues that affected earnings. However, Ford's incoming CFO, Sherry House, highlighted the company's focus on a $1 billion reduction in material and warranty costs compared to last year as part of their 2025 strategy.
"'I'm really excited about this year because it's Ford's chance, like in '07 and '08, to take our future in our own hands and perform financially like we should," – Farley
Ford's CEO, Jim Farley, expressed optimism about the company's prospects, drawing parallels to past periods where Ford has successfully navigated economic challenges. Ford's financial outlook for 2025 remains aligned with or lower than many analyst expectations.