GM CEO Mary Barra speaks to the media before the start of the 2017 General Motors Company Annual Meeting of Shareholders at GM Global Headquarters in Detroit, Michigan, Tuesday, June 6, 2017.
John F. for GM. Martin’s photo
General Motors It reported second-quarter earnings Tuesday that missed Wall Street’s estimates.
But the company maintained its previous revenue guidance for the full year, saying it hoped to ramp up production in the second half of 2022. It also ensured that adequate supplies are locked in to support critical battery-related items. Its mid-decade EV plans.
Shares were down roughly 1% in premarket trading on Tuesday.
Here are Important numbersCompared to Wall Street consensus expectations compiled by Refinitiv.
- Adjusted earnings per share: $1.14, $1.20 expected and $1.97 in Second quarter of 2021.
- Revenue: $35.76 billion, compared to an expected $33.58 billion and $34.17 billion in the second quarter of 2021.
- EBIT-adjusted: $2.34 billion, compared to $4.12 billion in the second quarter of 2021.
- EBIT-adjusted margin: 6.6%, 11.2% in the first quarter of 2022 and 12.0% in the second quarter of 2021.
CEO Mary Barra said A statement GM has “binding agreements” with Livent Corp. for lithium that secure all battery-related raw materials needed to build 1 million electric vehicles annually in North America by 2025. with “new multi-year agreements” announced Tuesday, and with longtime GM battery partner LG Chem for cathode materials.
Like other global automakers, GM has spent the past several quarters working through supply chain disruptions as Covid-19 outbreaks — and, more recently, Russia’s invasion of Ukraine — forced factory closings and wreaked havoc on logistics around the world.
Those disruptions were felt at GM’s U.S. dealers, where inventories continue to be tight. GM’s U.S. dealers added just 10 to 15 days of inventory in the second quarter last year, GM said Tuesday. This is much tighter than the 60 to 90 days that was the norm before the Covid-19 pandemic.
But GM expects to get more vehicles to its dealers soon. The company told investors on July 1 95,000 vehicles are missing from its inventory. It confirmed on Tuesday that it expects to complete and ship those vehicles — many of them high-margin SUVs — in the next few months.
GM, like most automakers, records revenue when a completed vehicle is shipped to dealers, not before.
“We have been operating with lower volumes due to semiconductor shortages for the past year, and despite those pressures we have delivered strong results,” Barra said. “There are concerns about economic conditions. That’s why we are already taking proactive steps to manage costs and cash flows, including reducing discretionary spending and limiting hiring to critical needs and positions that support growth.
“We’ve modeled multiple fallout scenarios, and we’re prepared to take deliberate action when necessary,” Barra said.
Barra said GM is still confident it will meet that Advance guidance for full year. The company expects net income for 2022 to be between $9.6 billion and $11.2 billion.
“This optimism stems from our expectation that GM global production and total deliveries will increase sharply in the second half,” he said.
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