General Motors ( GM ) cheered investors on Tuesday morning after the automaker raised its guidance for the third time this year, handily beating third-quarter revenue and profit expectations.
For the quarter, GM posted revenue of $48.78 billion, beating the Bloomberg consensus estimate of $44.69 billion and up from nearly $48 billion in the previous quarter. GM’s Q3 revenue was up 10.5% from last year.
The company reported adjusted earnings of $2.96 per share, beating expectations of $2.44. It posted EBIT-adjusted profit of $4.115 billion, up 15.5% from a year ago, and EBIT-adjusted margin rose to 8.4% from 8.1% year-on-year.
GM stock rose nearly 8% in early trading.
Based on the guidance, GM made the following upward revisions to its full-year 2024 forecast:
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Adjusted EBIT (earnings before interest and taxes): $14 billion to $15 billion ($13 billion – $15 billion ago)
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Automotive operating cash flow: $22 billion to $24 billion ($19.2 billion – $22.2 billion previously)
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Adjusted automotive free cash flow: $12.5 billion to $13.5 billion ($9.5 billion – $11.5 billion previously)
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Diluted-adjusted EPS: $10 to $10.50 (Formerly $9.50-$10.50)
“I’m proud that GM continues to deliver our best vehicles with strong financial results. But I want to be clear that we’re not mistaking progress for success,” GM CEO Mary Barra wrote in a letter to shareholders. “Competition is fierce and the regulatory environment will continue to get tougher. That’s why we’re focused on improving our ICE. [internal combustion engine vehicle] We are working to make margins and our EVs profitable on an EBIT basis as soon as possible.”
GM CFO Paul Jacobson said in a media call with reporters that a 19% reduction in GM’s stock count provided a “tailwind” to the EPS beat, with the profit driven by the earnings power of the company’s core business.
Jacobson told Yahoo Finance that the company will be serious about getting back in 2025.
In Q3, GM delivered 659,601 vehicles, down 2% from a year ago; However, retail sales increased by 3%. GM said it delivered more vehicles than any other automaker in the U.S. during the quarter.
Not surprisingly, sales of GM’s pickup and full-size SUVs led the way, but electric vehicle sales were also a highlight. Amid the sales slump for the Bolt EV, GM’s other EV models suffered a slowdown with sales totaling 32,195 EVs, up 60% from a year ago.
At GM’s investor day in early October, Jacobson said the company is still targeting EV profitability. In terms of positive variable profit marginDespite revising its EV production volume forecast to 200,000 units, at the low end of its previous range of 200,000 to 250,000 units. The company expects to reduce EV costs by $2 billion to $4 billion by 2025.
