GM Earnings Top Forecasts Despite Headwinds

General Motors made more money than expected so far this year, even as union contracts reached last year increased labor costs, its customers faced higher interest rates to buy cars and its electric vehicles still aren’t turning a profit yet, reported Chris Isidore for CNN.

GM said it expects its North American EV business to turn a profit in the second half of the year. I Photo: Yahya S. Flickr

But GM said it expects its North American EV business to turn a profit in the second half of the year. That and strong demand for traditional gasoline-powered vehicles allowed it to raise its earnings forecast for the year.

Reaching a profit on its EV business would be a major milestone, as EVs have yet to make the kind of cash that hybrids and gasoline-powered cars make for traditional automakers, who are planning a shift to EVs in the years ahead.

GM officials said they believe its EV offerings will be even more profitable moving into 2025, despite the slowdown in growth of demand for EVs in its home market.

It had an adjusted net income of $3.0 billion, down 2% from the $3.1 billion it reported on that basis a year earlier. The company announced a $10 billion share repurchase last fall following its labor deal with the United Auto Workers (UAW) union.

The fewer number of shares outstanding allowed it to report improved earnings per share, which is closely watched by investors. That resulted in adjusted earnings per share of $2.62, up 18.6%, easily topping forecasts that EPS would slip to $2.13.