Ford Q4 Earnings Beat, Issues Muted Full-Year Guidance

Key Points:

- Ford (F) reported better-than-expected Q4 earnings and revenue.
- Full-year profit slightly exceeded forecasts.
- Ford issued conservative full-year 2025 guidance due to market headwinds.
- Model e segment incurred a $5.1 billion full-year EBIT loss.
- Ford CEO Jim Farley calls for a comprehensive tariff policy.

Financial Performance:

- Q4 Revenue: $48.2 billion (vs. $43.01 billion estimated)
- Adjusted EPS: $0.39 (vs. $0.32 expected)
- Adjusted EBIT: $2.1 billion

Full-Year 2025 Guidance:

- Adjusted EBIT: $7.0-$8.5 billion
- Adjusted Free Cash Flow: $3.5-$4.5 billion

Business Unit Performance (Q4):

- Ford Blue: $27.3 billion revenue, $1.581 billion EBIT
- Model e: $1.4 billion revenue, -$1.389 billion EBIT
- Ford Pro: $16.2 billion revenue, $1.629 billion EBIT

Challenges:

- Market headwinds, including pricing pressures
- Potential loss of EV tax credits
- 25% tariff on imports

Outlook:

- Ford expects Q1 2025 to be "roughly breakeven" due to lower sales and unfavorable product mix.
- Farley emphasizes progress in quality and cost improvements as part of the Ford+ transformation.
- Ford anticipates $1 billion in cost savings.

Competition:

- Ford estimates GM's EV business incurred a $5 billion EBIT loss in 2024.
- Wolfe Research projects a $4.25 billion loss for GM's EV unit in 2025.

Tariff Concerns:

- Farley calls for a comprehensive tariff policy that addresses imports from all automakers.
- He highlighted the disparity in tariffs paid by Ford compared to competitors like Hyundai-Kia and Toyota.