The shares of automotive giant Ford plummeted after the company reported below-expectations second-quarter earnings, as well as a disappointing next year forecast.
Ford cut thousands of jobs earlier this year, and the company’s plan is to invest over $11 billion into electric cars and hybrid vehicles by 2022, in order to keep up the pace with the changes in the automotive industry.
Chief Executive Jim Hackett said: “Midway through this key year of action, we are pleased with the progress we are making toward creating a more dynamic and profitable business. In this time of profound change in our industry, Ford has amazing opportunities to delight customers, innovate and collaborate in new ways, and create value.”
Even so, shares fell by more than 6% in extended trading. Here is what the company expected, and what Wall Street professional analysts estimated – 28 cents per share, vs. estimates of 31 cents per share, and 35.76 billion vs an estimate of $35.07 billion. Revenue fell from $38.92 billion a year before, to $38.85 billion.
Ford’s biggest profits in the second-quarter are from North America. Their F-Series dominated the pickup market, and its Ranger is also being sold well. Their newest SUVs, the Expedition, EcoSport, and Edge, amounted to a 14% sales boost in the second quarter of 2019. Ford is also introducing new versions of the Explorer and Escape later this year.
Tim Stone, Ford CFO, said that the company is still in early stages of restructuring, but is already starting to see improved free cash flow. Better results in the second half of 2019 are expected as the restructuring progresses on schedule and more Ford SUVs are released on the market.