Ford Motor (NYSE: F) surged 2.5% after its announcement that its adjusted pre-tax Q2 earnings would “surpass its expectations” and be much higher compared to the previous year’s numbers. Furthermore, it expects net income to be “substantially lower” than the same period last year. Shares rose 1% in early morning trading upon the news.
The company published the forecast before CEO Jim Farley’s presentation at Deutsche Bank’s global automotive industry conference on Thursday. The strong results are led by lower than expected costs as well as strong market elements.
“The improvement in automotive is being driven by lower-than-anticipated costs and favorable market factors,” the company said. “Additionally, higher vehicle auction values are benefitting Ford Credit.”
The company said Farley will inform attendees that Ford has experienced improvement within its business since revealing its full-year operating guidance on April 28. The strong results are in spite of the turbulent market, which includes the shortage of semiconductor chips needed to manufacture cars.
“Net income for the second quarter of 2021 is expected to be substantially lower than a year ago, when results included a $3.5 billion gain on Ford’s investment in Argo AI,” the company said in a press release.
Ford is set to report its second quarter results and guidance on July 28.
“We’re providing customers with great value today and there’s much more on the way, because we’re executing Ford+ from strength – with iconic nameplates and leading positions with retail and commercial customers around the world, and the best financing company in our industry in Ford Credit,” President and CEO Jim Farley said.