Ford Gains Market Share but a Strong Dollar Hurts 2Q15 Revenues
Ford’s 2Q15 Earnings: Key Investor Takeaways
Ford gains market share in 2Q15
Previously in this series, we’ve explored Ford’s (F) key operations. Now, we’ll look at its 2Q15 financial performance. Ford’s global market share increased to 7.6% in 2Q15 compared to 7.5% last year. General Motors (GM), however, lost its global market share in 2Q15. GM’s global market share at the end of 2Q15 was 11%, which is down 20 basis points compared to last year. Both GM and F’s earnings were negatively hit by the strong US dollar (UUP).
Key metrics from Ford’s 2Q15 earnings
The chart above shows the key metrics from Ford’s 2Q15 earnings. Its revenues declined by $200 million on a year-over-year basis. The falling revenues are due to unfavorable currency movements. Ford’s 2Q15 revenues were negatively hit by ~$2 billion on account of the stronger US dollar. GM, on the other hand, took a hit of $2.2 billion in its 2Q15 revenues from a stronger dollar.
Ford’s wholesale sales, however, rose in 2Q15. This rise contrasts to 1Q15, when Ford’s wholesale sales had fallen.
Operating margin
Ford’s operating margin increased to 7.2% in 2Q15 compared to 6.6% last year. This is an encouraging development for Ford investors. The company’s 2Q15 pre-tax earnings also increased ~10% compared to the last year. Ford didn’t include any special items in its 2Q15 earnings. GM incurred special items of $1.1 billion in 2Q15.
Together, Ford and BorgWarner (BWA) form ~3% of the Consumer Discretionary Select Sector SPDR ETF (XLY).
Ford’s North American operations posted their best-ever quarter. We’ll explore the key highlights in the next part of this series.
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