GM (GM) reported second quarter results before the bell on Tuesday that topped expectations, with the Big Three stalwart continuing to grow profits despite fewer sales.
GM reported Q2 revenue of $48.03 vs. $46.61 billion, per Bloomberg consensus, up 1.9% from the $47.1 billion the automaker posted a year ago. GM posted adjusted earnings per share (EPS) of $3.57 vs. $3.19 estimated, and adjusted EBIT of $3.94 billion compared to $3.7 billion expected.
For comparison, GM's adjusted EBIT in Q2 last year came in at $3 billion — a figure heavily weighed down by tariff costs that are now easing, as tariff offsets take hold.
And for a second time this year, GM raised its guidance. For the full year, now GM expects:
Adjusted EBIT of $14.0 billion – $16.0 billion (prior $13.5 billion – $15.5 billion)
Adjusted EPS of $12.00 – $14.00 (prior $11.50 – $13.50)
Adjusted automotive free cash flow of $9.5 billion – $11.5 billion (prior $9 billion – $11 billion)
GM said its updated guidance made key assumptions, including pricing up around 0.5%, EV losses improving by $1.0 to 1.5 billion, regulatory benefits of $500 to $700 million, gross tariff costs of $2.5 to $3.5 billion, and commodity inflation (including DRAM) of $1.5 to $2.0 billion, among others.
"Customer demand in North America remains strong driven by our very attractive lineup of pickups and SUVs," CEO Mary Barra added in her letter to shareholders. "Our 8.6% EBIT-adjusted margin in North America was up 2.5 points from a year ago, and we continue to lower our warranty costs, reduce EV losses, and increase operating efficiency. "
GM said incentives as a percentage of MSRP averaged 4.7% in Q2, below the industry average of 6.3%, with dealer inventory down 3% year over year, in the company's targeted range of 50 to 60 days.
In addition to government offsets that are reducing its tariff bill, GM has spent the past year reworking its supply chain, shifting production, and negotiating with suppliers to blunt the tariff hit.
But while tariffs easing will help its bottom line, its vehicle sales have been slipping.
GM sold approximately 715,000 vehicles in the US in the second quarter, a 4.2% decline from a year ago, though it held its position as the country's top-selling automaker.
The company said much of the drop was due to discontinued models like the Cadillac XT4 and XT6 and the Chevrolet Malibu, as well as a sharp EV pullback following the expiration of the federal EV tax credit, which pulled demand forward into late 2025.
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