General Motors (GM) reported better-than-expected results for the fourth quarter, with both revenue and adjusted earnings per share beating estimates. The company’s topline revenue for Q4 stood at $42.98 billion, surpassing the $39.53 billion consensus estimate. Adjusted earnings per share came in at $1.24, beating the estimated $1.16. Despite the positive results, adjusted EBIT (earnings before interest and taxes) dropped 53.8% compared to a year ago, standing at $1.757 billion.
For the full year, GM earned $12.4 billion in adjusted EBIT, falling within the reinstated outlook range provided in late November, which expected adjusted EBIT between $11.7 billion and $12.7 billion. Looking ahead to 2024, GM forecasts a full-year adjusted EBIT in the range of $12 billion to $14 billion, in line with its initial forecast for 2023. The company also anticipates adjusted earnings per share of $8.50 to $9.50 for the year.
Despite challenges in the electric vehicle (EV) rollout and the impact of the UAW strike, GM remains optimistic about industry sales, expecting healthy sales of about 16 million units, with the growth of EVs continuing. While the pace of EV growth has slowed, GM aims to become “variable profit positive in the second half of the year.” The company acknowledges some uncertainties in the EV market but remains committed to its EV goals. GM did not provide updates on its earlier goal of achieving 1 million units of EV capacity by 2025.
Despite concerns over the UAW strike, GM’s sales for Q4 were not significantly affected, as the company had built up sufficient inventory in anticipation of the strike. The overall sales for 2023 showed positive growth, with a 14.1% increase to 2.6 million vehicles, marking the best year since 2019. GM also projects total US auto industry sales to reach 16 million in 2024, a significant improvement from the pandemic-affected 13.4 million vehicles sold in 2022. However, GM is projecting a loss in China for Q1 2024. Additionally, the recent investigation into Cruise, GM’s autonomous driving division, by regulatory bodies, adds a layer of complexity to the company’s challenges.