US automaker Ford topped earnings expectations in the fourth quarter of 2023 and is forecasting higher profits this year despite greater labor costs and losses in its electric vehicle segment, according to a financial report released Tuesday.
The company reported adjusted earnings per share of 29 cents for the fourth quarter, above analyst estimates, while revenue came in at $46 billion for the period.
For 2024, Ford expects earnings of $10 billion to $12 billion before interest and taxes, compared with $10.4 billion reported in 2023.
Ford's latest results come after the auto giant, alongside General Motors and Stellantis, were hit by a six-week worker strike that has since been resolved.
The company expects "higher expenses for labor and major product-refresh actions" this year.
But chief operating officer Kumar Galhotra said the company "will land $2 billion in cost reductions" across its global industrial system in areas like freight and manufacturing.
For all of last year, Ford reported net income of $4.3 billion and an 11 percent revenue increase to $176 billion.
Meanwhile, Ford's Model e unit -- involving its electric vehicle products -- incurred a full-year loss of $4.7 billion before interest and taxes.
This reflects "an extremely competitive pricing environment, along with strategic investments in the development of clean-sheet, next-generation EVs," the company said in its report.
But Ford chief financial officer John Lawler said in a statement that EVs are "here to stay."
"Customer adoption is growing, and their long-term upside is central to Ford+," he added, highlighting that the company is gathering customer insights by being an early mover in the sector.
But with mainstream EV adoption taking place at a slower rate than anticipated, Ford earlier said it was deferring certain capital investments in the segment "until they're justified by demand and prospects for acceptable returns."
Last week, General Motors reported higher quarterly profits, offsetting the hit from the worker strike thanks to robust vehicle pricing, amid strong demand in North America.
In after hours trading, Ford shares were up 7.1 percent.
