What happened

Ford (F 0.08%) shareholders didn't wake up to good news Tuesday. The company put out an earnings warning and made clear that it is still struggling to navigate supply chain challenges. The stock reacted with more than a 10% drop in morning trading. As of 10:41 a.m. ET, Ford shares were still down 9.4%. 

So what

Ford said late Monday it would take a $1 billion hit in its third quarter from what it called "inflation-related Q3 supply costs." The company additionally warned that some revenue would be deferred to the fourth quarter as 40,000 to 45,000 vehicles remained in inventory lacking some parts. The company reaffirmed its estimate for 2022 adjusted earnings before interest and taxes (EBIT) of between $11.5 billion to $12.5 billion, but that didn't satisfy investors today. 

Ford F-150 Lightning plugged into charger.

Image source: Ford.

Now what

One reason for that may be that the company didn't say anything in the release about its prior free cash flow estimates. Investors should assume that metric will decrease at a time when the company needs to invest to ramp up its electric vehicle offerings. In its second-quarter report released in late July, Ford said it expected adjusted free cash flow of between $5.5 billion and $6.5 billion for the full year. 

In that same report, Ford increased its estimate for inflation-related costs to $3 billion for 2022. That was $1 billion more than it expected just several months prior, and now it has bumped those expected costs by another $1 billion. 

Ford may have strong demand for its electric vehicle lineup, but shareholders are fretting that the bottom line isn't going to be what they want to see going forward. Investors will hear Ford's full third-quarter report on Oct. 26.