GM (GM) investors are looking for the Big Three automaker to continue its strong run of quarterly performance last year, with fourth quarter results on deck for Tuesday morning. But challenges do remain for the automaker in 2025.
GM’s strong truck and SUV sales, as well as surprising strength in its EV business, saw shares surge in 2024, to the tune of 48%.
For the quarter, analysts expect GM to post revenue of $44.46 billion per Bloomberg estimates, above the $42.98 billion the company reported a year ago. On the profitability front, GM is expected to report adjusted EPS of $1.83 on adjusted net income of $1.954 billion.
In terms of full year-performance, following Q3 results in late October, GM issued updated guidance:
Adjusted EBIT (earnings before interest and taxes): $14 billion to $15 billion
Automotive operating cash flow: $22 billion to $24 billion
Adjusted automotive free cash flow: $12.5 billion to $13.5 billion
Diluted-adjusted EPS: $10 to $10.50
It was the third time GM upped its guidance last year. Looking ahead, GM CEO Mary Barra said following the Q3 report that GM expects 2025 adjusted EBIT to be in a similar range to the full-year 2024 results.
GM was able to lift those profitability marks partially due to its sales performance, particularly in the US.
Earlier this month, GM reported Q4 sales jumped 21% from a year ago and were up 4% in 2024 to 2.7 million vehicles, with full-size pickup sales up for the fifth straight year, hitting their highest level since 2007. Sales of full-size SUVs like the Tahoe, Suburban, and Yukon also propelled GM to a category win in the segment for the 50th straight year.
GM’s stock repurchase plans also had a big effect in boosting its share price.
Last June GM issued a new share buyback plan to repurchase up to $6 billion of its outstanding common shares. This is an addition to the $10 billion accelerated share repurchase (ASR) program it introduced at the end of last year, which also coincided with its plan to increase its dividend by 33%, beginning last January.
As for its EVs, vehicles like the Cadillac Lyriq and Chevrolet Equinox EV have been selling well, but growth in the business hasn’t been as fast as the company originally projected.
GM CFO Paul Jacobson said at GM’s investor day in early October that the company is still targeting EV profitability on a positive variable profit margin basis, despite the fact that it revised 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 is expecting to trim EV costs by $2 billion to $4 billion in 2025.
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