Ford Ends 2017 On A “Challenging” Note As Operating Margins Decline
Ford Motor Company (NYSE: F) announced its Q4 and full year 2017 results on January 24th 2018 and the company missed analyst expectations for EPS (earnings per share). For Q4 2017, Ford Motors reported an EPS of $0.39 per share, against the consensus estimates of $0.44 per share. Revenues stood at $41.3 billion which were higher than expected. The key takeaway from Ford’s earnings was that higher costs (rising commodity costs, warranties, exchange impacts and recalls) have impacted the company’s profitability in 2017 and its operating margin for Q4 2017 stood at 3.7% down 200 basis points compared to the same quarter in the previous year. The company expects higher costs to impact its profitability in 2018 as well.
The charts below summarize Ford’s performance in 2017 – quarter wise. You can click here to modify these charts.
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Guidance and Future Outlook:
- For 2018, Ford Motors expects its revenues to be flat and EPS (earnings per share) to be in the range of $1.45 to $1.70.
- The company is likely to launch 23 new products in 2018 compared to 11 products in 2017
- 2018 is likely to be a “transition” year for Ford Motors as the company addresses the “fitness” of its business. It is likely to make changes in areas such as product development, manufacturing, and marketing to become more efficient and customer centric in design. The results of these efforts are likely to be visible in 2019 and beyond.
We will be updating our model for Ford Motors based on the above results.
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