Shares of Ford Motor Co. are tumbling Thursday after the automaker’s second-quarter adjusted profit badly missed Wall Street’s expectations thanks in part to stubborn warranty costs.
A motorist puts an electric 2024 Ford Mustang Mach-E through its paces on a test track at the Electrify Expo in The Yards Sunday, July 14, 2024, in north Denver. Ford reports earnings on Wednesday, July 24, 2024. Shares of Ford Motor Co. are tumbling Thursday after the automaker's second-quarter adjusted profit badly missed Wall Street's expectations thanks in part to stubborn warranty costs.reported an adjusted profit of 47 cents per share.
Ryan Brinkman of JPMorgan said in an analyst note that the weaker-than-expected quarterly profit was surprising, particularly whenreported a strong performance a day earlier. Brinkman outpointed that warranty costs were the culprit at Ford, which were above his expectation for flat to lower costs sequentially.
“Ford management believes its initial quality on newly built vehicles has since improved, implying stronger-than-might appear current-period execution and lower future-period warranty expense, although we do not expect investors to give Ford a pass, including given the automaker has intermittently struggled with higher repair costs for coming on several years,” he wrote.Copyright 2024 The Associated Press. All rights reserved.
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