Goodyear Tire & Rubber Co.
shares fell 11% in the extended session Monday after the tire maker reported third-quarter earnings below Wall Street expectations and said “challenges” with inflation and a stronger dollar remain. Goodyear earned $44 million, or 16 cents a share, in the quarter, compared with $132 million, or 46 cents a share, in the year-ago period. Adjusted for one-time items, the company earned 40 cents a share. Sales rose 8% to $5.03 billion, from $4.93 billion a year ago. Analysts polled by FactSet expected the company to report adjusted earnings of 55 cents a share on sales of $5.36 billion. Goodyear said that after “strong” profits and sales growth in the first half of the year, third-quarter results “moderated” thanks to weaker volumes and “increasing pressure from cost inflation,” partly offset by “continued strong” pricing and product mix. Cost inflation is likely to peak in the fourth quarter, rather than in the third quarter as the company projected. “During the third quarter, we faced many ongoing challenges, including persistent inflation. At the same time, new challenges emerged, including a less certain outlook in Europe and the effects of a stronger U.S. dollar,” the tire maker said in a letter to shareholders. Goodyear ended the regular trading day up 1.4%.
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