General Motors Company (NYSE:GM) stock rose Tuesday after a clean beat on profit and sales, as CEO Mary Barra revved the 2025 outlook.
EV losses are narrowing, tariffs are easing, and the firm is steering toward a leaner, more profitable path.
The auto behemoth registered third-quarter adjusted earnings per share of $2.80, beating the analyst consensus estimate $2.31.
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Quarterly sales of $48.59 billion (down 0.3% year over year) topped Street view of $45.27 billion, driven by Chevrolet’s rise to America’s No. 2 electric-vehicle brand, with the Equinox EV emerging as the best-selling non-Tesla model, the company said.
Amid shifting rules and fading federal incentives, General Motors sees slower near-term EV adoption and is reassessing capacity. The review triggered a third-quarter special charge and may bring more, aiming to cut overcapacity and EV losses by 2026.
Net sales in the Automotive segment totaled 44.256 billion, lower than $44.735 billion in the year-ago period.
“In the U.S., we achieved our highest third-quarter market share since 2017 with strong margins, and our restructured China business was profitable once again,” said Barra in the company’s letter to shareholders.
Margins Contract
Adjusted EBIT margin contracted to 6.9% in the quarter under review from 8.4% in the year-ago period.
Adjusted EBIT decreased to $3.376 billion from $4.115 billion, primarily due to the impact of tariffs, higher warranty-related costs, and lower volume.
Net income margin contracted to 2.7% from 6.3%.
In her letter to the shareholders, Barra highlighted that earlier this year, the firm announced $4 billion in capital investments to onshore production at plants in Tennessee, Kansas, and Michigan over the next two years.
Once these investments come online, the firm plans to produce more than two million vehicles per year in the United States.
“We are also investing close to $1 billion to build a new generation of advanced, fuel-efficient V8 engines in New York. Importantly, we are maintaining our capital discipline while adding this production and creating new jobs,” the CEO added.
General Motors’ third-quarter dealer inventory fell 16% from a year ago to 527,000 units, keeping the company on track to end the year with 50 to 60 days’ supply. The electric-vehicle inventory is down nearly 30% since the end of June.
Strong cash flow is supporting a balanced capital-allocation plan. In the quarter, General Motors invested $2.1 billion in capital projects, paid down $1.3 billion in balance-sheet debt and repurchased $1.5 billion in stock.
Outlook
General Motors narrowed its 2025 GAAP earnings-per-share guidance to $8.30 to $9.05 from $8.22 to $9.97, versus a $9.19 analyst estimate.
The company raised its 2025 adjusted EPS outlook to $9.75 to $10.50 from $8.25 to $10.00, above the $9.46 consensus.
The firm expects to recognize more than $200 million in Super Cruise revenue in 2025.
It also introduced a new MSRP Offset program designed to make U.S.-built vehicles more competitive over the next five years.
“Looking ahead, our top priority is to restore North America to our historical 8–10% EBIT-adjusted margins. We are focused on driving EV profitability, maintaining production and pricing discipline, managing fixed costs, and further reducing tariff exposure,” Barra added.
Tariff Update
General Motors said its 2025 full-year gross tariff impact has improved to $3.5 billion to $4.5 billion, down from $4 billion to $5 billion.
The outlook assumes tariff rates stay at current levels and includes indirect costs from materials and suppliers.
New tariff revisions expand the MSRP tariff offset, with the financial benefit recognized in the fourth quarter.
Mitigation actions are expected to offset about 35% of the impact due to a lower tariff base.
Price Action: GM shares were trading higher by 11.72% to $64.80 premarket at last check Tuesday.
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