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Investing.com -- Ford Motor on Wednesday forecasted weaker annual profit that overshadowed better-than-expected fourth-quarter results at a time when the threat of U.S. tariffs on Canada and Mexico that have been temporarily paused continues to stoke uncertainty.
Ford Motor Company (NYSE:F) was down nearly 5% in premarket trading Thursday.
For 2025, the company said it expects adjusted earnings before interest and taxes, or EBIT, a measure of profitability of $7B to $8.5B, which is well below the adjusted EBIT of $10.2B seen in 2024.
The company said the guidance "presumes headwinds related to market factors."
The first half of 2025 is expected to be weaker than the latter half, with first-quarter adjusted EBIT projected to be around breakeven. This is due to lower wholesales and a shift toward less profitable vehicle production, including launch activity at key U.S. assembly plants in Kentucky and Michigan.
While notably below consensus, investors are wondering if Ford’s 2025 guidance "could mean numbers are derisked," RBC Capital Markets analysts noted.
"We think it is too early to tell," they added. "Inventory days are elevated, and this could lead to down net pricing. Ford also faces launch cost headwinds and greater EV volumes coming at the expense of profits."
Separately, Barclays analysts emphasized that they "certainly wouldn’t characterize the guidance as conservative."
They highlighted a contrast in Ford’s 2025 outlook, stating that it reflects a weaker outlook despite a generally favorable U.S. auto market—assuming no tariffs—with stable volume and only modest price erosion.
"Accordingly, we believe 2025 represents a key “show me” year for Ford on two fronts – cost and inventory management," they continued.
The weaker outlook overshadowed Q4 results that topped Wall Street estimates.
The automotive company reported adjusted earnings per share of $0.39 on revenue of $48.2 billion. Analysts polled by Investing.com anticipated per-share income of $0.36 on revenue of $47.79B.
Yasin Ebrahim contributed to this report.