General Motors (GM) reported profit jumped in the third quarter, driven by record revenue and robust demand.
For the quarter, GM reported revenue of $41.89 billion, just slightly below analyst expectations of $42.37 billion, but still a record amount for the automaker.
GM’s adjusted third quarter EPS came in at $2.25, well ahead of expectations of $1.89, with adjusted net income jumping nearly 50% to $4.3 billion.
What has surprised some on the Street is GM reaffirming its full-year EBIT (earnings before interest and taxes) of $13 billion to $15 billion, which many had expected might get cut.
“We’re delivering on our commitments and affirming our full-year guidance despite a challenging environment because demand continues to be strong for GM products and we are actively managing the headwinds we face,” GM CEO Mary Barra said in a letter to shareholders.
“We haven’t seen any direct impact on our products. Pricing remains strong. Demand remains strong,” GM CFO Paul Jacobsen said regarding concern over the potential of a U.S. economic slowdown.
Barra said strong demand plus easing of supply-chain constraints led GM to lead the market in full-size pickup, full-size SUV and Cadillac Escalade segments.
On the EV front, GM said it captured 8% of the U.S. market share due to record sales of the Chevrolet Bolt EV and Bolt EUV, with Barra boasting the Bolt out sold Ford’s Mach-E by more than two to one in September.
Wedbush analyst Dan Ives said GM’s “solid” Q3 results were a “major step in the right direction for the Detroit stalwart.”
“In this brutal supply chain backdrop and with a softer consumer environment, we would characterize a strong EBIT beat and generally in-line top-line as much better than feared by the Street,” Ives said. “Guidance for the year was reiterated and ultimately speaks to the drumroll into 2023 that will be a pivotal year for the Detroit stalwart on its EV strategic vision.”
Speaking of its EV vision, Barra said its Equinox EV, Silverado EV, and Blazer EV are “cornerstones” of its EV strategy, and reaffirmed that the automaker has secured commitments for battery raw materials needed to reach “more than 1 million units of annual EV capacity in North America in 2025.”
GM’s crosstown rival Ford (F) is set to report earnings after the bell on Wednesday.