GM shares jump as higher profit beats Q3 estimates

Posted on October 25, 2022Comments Off on GM shares jump as higher profit beats Q3 estimates

© Reuters. FILE PHOTO: The new GM logo is seen on the facade of the General Motors headquarters in Detroit, Michigan, U.S., March 16, 2021. REUTERS/Rebecca Cook

By Joseph White, Paul Lienert and Ben Klayman

DETROIT (Reuters) -General Motors Co shares rose almost 5% in premarket trade on Tuesday as the company reported a higher quarterly profit that beat analysts’ estimates.

GM reaffirmed its guidance for full-year net income of $9.6 billion to $11.2 billion, and full-year diluted earnings per share of $5.76 to $6.76.

Diluted earnings per share in the third quarter of $2.25 topped estimates of $1.88.

The automaker reported net income of $3.3 billion, compared with $2.4 billion a year earlier. Revenue jumped to $41.9 billion, from $26.8 billion a year ago.

GM’s net margin slipped to 7.9%, from 9.0% a year earlier.

Chief Executive Mary Barra, in a letter to shareholders, cited improved supply chain conditions and said the company is “actively managing the headwinds we face.”

The automaker said higher volume in the quarter drove a $5 billion gain, with higher prices contributing a $2.1 billion gain, offset by $3.6 billion in additional logistics costs.

GM said it has received 170,000 reservations for the new Chevrolet Silverado EV pickup, which arrives at U.S. dealers next spring. The company said it captured 8% of the U.S. electric vehicle market in the quarter, on record sales of the Chevrolet Bolt and Bolt EUV.

Barra said GM continues to negotiate supply agreements and direct investments in raw materials to help drive EV growth beyond 2025.

The company said its majority-owned Cruise automated driving unit now expects revenue of $1 billion in 2025. The San Francisco company plans to begin operating a robotaxi service in three cities by the end of this year.

GM earlier forecast annual revenue for Cruise of $50 billion by 2030.

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