A General Motors sign is seen during an event on January 25, 2022 in Lansing, Michigan. – General Motors will create 4,000 new jobs and retaining 1,000, and significantly increasing battery cell and electric truck manufacturing capacity.
Jeff Kowalsky | AFP | Getty Images
DETROIT – Amid rising costs and supply chain instability, General Motors reaffirmed its earnings expectations for 2022 despite reporting a lower net profit and margin compared to a year ago.
Here’s how GM did compared with what Wall Street expected:
- Adjusted EPS: $2.09 vs $1.68, according to Refinitiv consensus estimates
- Revenue: $35.98 billion vs $37.01 billion, according to Refinitiv consensus estimates
GM reaffirmed its pretax adjusted earnings forecast of between $13 billion and $15 billion for the year, while lowering its net income expectations to between $9.4 billion and $10.8 billion from $9.6 billion and $11.2 billion. Its first quarter profit margin was 8.2%, down from 9.3% a year earlier.
On an unadjusted basis, net income was $2.9 billion for the first quarter compared with $3 billion a year earlier. The automaker reported pretax adjusted earnings of $4 billion for the first quarter, down from $4.4 billion a year earlier.
GM is among the first major automakers to report its first-quarter results. Investors are watching the report closely as a gauge of the auto industry’s ongoing production and supply chain problems.
In addition to inflation and other macroeconomic factors, the global automotive industry has been battling supply chain problems caused by the coronavirus pandemic for more than a year — specifically, supplies of crucial semiconductor chips that are used throughout vehicles.
The ongoing war in Ukraine as well as recent factory shutdowns in China due to Covid-19 outbreaks have further exasperated the industry’s supply chain challenges.
Investors are also eager for any progress or updates on GM’s plans for autonomous and electric vehicles, including a planned $35 billion investment in the technologies through 2025. GM doesn’t typically break out such costs on a quarterly basis, though rival Ford Motor has promised to begin doing so next year.
Shares of GM are down roughly 34% so far in 2022. Its market cap is about $55 billion, down from more than $90 billion at the beginning of the year.
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