Ford's shares tumbled as much as 5% in after-hours trading on Thursday after the automaker's fourth-quarter earnings fell short of Wall Street's forecast.
Ford Motor Company finished 2021 with $36 billion in cash, a slew of hot-selling new electric vehicles, and a strong estimate for sales and profit growth this year, but it wasn't enough to satisfy investors. Despite the fact that the number of automobiles it sold globally fell by 11% to 1.1 million. Because of the ongoing chip scarcity and supply chain concerns, most major automakers throughout the industry have been forced to temporarily halt their plants and curtail output during the quarter, resulting in limited stocks of new vehicles accessible to customers. As a result, automobile costs have reached new highs, reducing the need for automakers to give incentives to entice consumers.
The fourth-quarter net income increased to $12.3 billion, up from a $2.8 billion loss the previous year. Earnings before interest and taxes increased to $2.0 billion from $1.7 billion the previous year.
The business recorded $1.1 billion in profits excluding extraordinary items, down from $1.4 billion on the same basis a year earlier.
Ford enters 2022 in a better financial situation than it has been in for a long time. According to the corporation, it has $36 billion in cash and $52 billion in liquidity. These figures reflect Ford's investment in Rivian Automotive Inc (RIVN.O), which is valued at $10.6 billion by the end of 2021. For 2022, Ford expects to earn between $11.5 billion and $12.5 billion in adjusted pretax earnings and $5.5 billion to $6.5 billion in adjusted free cash flow.
Ford anticipates a 25% increase in full-year operating earnings this year as several of its worldwide units that lost money in the quarter, such as Europe and China, return to profitability. Vehicle sales are expected to fall in the first quarter of 2022 as a result of persistent supply chain challenges and a worldwide semiconductor shortage.
Customers have bought or requested more than 275,000 electric F-150 Lightnings, vans, and electric Mustangs. By the end of 2023, the corporation reaffirmed its objective of producing 600,000 electric vehicles per year.
