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F: Ford Stock Slips on Earnings Miss

Warranty costs blamed for the decline


Ford stock (F) is down in early morning trading on news that its quarterly earnings report missed analyst expectations.

FordFord reported that its net income fell 39% in the first quarter — in part because of a charge for downsizing its European operations and higher warranty costs.

Ford stock is down 2.9% in early Friday trading.

The automotive company earned $989 million in Q1 (24 cents per share), down from $1.61 billion in the same period a year earlier.

Not including a $122 million one-off charge for European job cuts, Ford earned 25 cents — far short of the 31 cents a share expected by analysts.

Via USA Today:

Last quarter, Ford estimated that its 2014 profit would be $7 billion to $8 billion. It also warned that its operating margin would be lower than it was last year. The company cited pricey new model launches, which no doubt includes the much-publicized aluminum 2015 Ford F-150.

The company has seen strong profit growth in recent quarters – and years – and hasn’t been bedeviled with the kind of high-profile safety scandals of its rivals, General Motors and Toyota.

Ford tried to put a positive spin on the year ahead, saying they were on track for solid full-year earnings.

“Two-thousand fourteen is shaping up to be another solid year for the Ford Motor Company,” Ford Chief Executive Alan Mulally said in a statement.

Ford stock is up 2.9% year to date.

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