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GM Posts 2% Profit Gain as Revenue Dips
General Motors Co. boosted its net income in the second quarter 2% to $2.4 billion, as revenue slipped 2% to $36.1 billion.
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General Motors Co. boosted its net income in the second quarter 2% to $2.4 billion.
The company’s operating income for the period surged by two-thirds to $2.5 billion. Unit sales fell 6% to 1.94 million cars and trucks. But a richer sales mix, led by strong demand for crossover vehicles and fullsize pickup trucks in the U.S., caused net revenue to slip only 2% to $36.1 billion.
GM emphasizes that it has a “cadenced” plan to fortify its truck sales with a parade of new iterations. The company also notes that layoffs and plant closures are expected to save $1.1 billion this year.
The company’s adjusted pretax earnings shrank 6% to $3 billion in April-June. An 11% gain to $3 billion in EBIT in North America was offset by weak results by overseas operations and the company’s GM Cruise autonomous vehicle subsidiary. Quarterly pretax earnings by GM Financial were flat as revenue climbed 3% to a record $3.6 billion.
GM reports that its factory sales to dealers dropped 6% to 1.13 million cars and trucks in the second quarter. During the same period, retail/fleet sales declined in all three of the company’s major markets: North America (-4% to 875,500 units), China (-12% to 753,900) and South America (-1% to 162,500).
GM affirms its earlier guidance for full-year results of earnings between $6.50 and $7 per share, compared with $3.04 in the first half. The company anticipates an adjusted free cash flow from automotive operations of $4.5 billion-$6 billion.
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