What happened

Ford (F -0.81%) reported its October sales numbers Wednesday, and initially, the market wasn't impressed. Shares of the U.S. automaker dropped by as much as 2.4% in early trading. But investors saw a positive side to the report too, and by 11:45 a.m. ET, Ford shares had rebounded and were up by 1.2% for the session. 

So what

The initial drop likely was prompted by the report's headline number, which showed Ford's U.S. sales had dropped by 10% versus last October. That slump was due to ongoing supply chain constraints, and Ford badly underperformed relative to the general auto industry. CNBC reported that in October, total U.S. auto sales increased by 9.1% year over year to almost 1.2 million units, citing data from Edmunds. 

rear view of silver Ford F-150 off road.

Image source: Ford.

Now what

There was also good news in the monthly sales report, though. Ford said its electric vehicle (EV) sales rose nearly 120% year over year. It now claims to be the No. 2 EV seller (behind Tesla), with a market share of 8.9%. The F-150 Lightning had its best sales month ever, and sales of its E-transit van climbed 71.5% compared to September. 

Last week, Ford updated its outlook for full-year adjusted earnings before interest and taxes (EBIT), setting its projection at about $11.5 billion. That's at the low end of its previous estimated range. It did boost its guidance for full-year adjusted free cash flow, however, to a range of $9.5 billion to $10 billion. That sharp increase from its previous guidance of $5.5 billion to $6.5 billion was due to the strength of its operations. Investors late Wednesday morning seemed to be looking beyond the short-term challenges and focusing instead on the strength of demand for Ford's vehicles and its growing EV sales.