Alrighty, so General Motors totally crushed Wall Street’s expectations in the first quarter, which is pretty impressive. But hold on a sec, they’re kind of rethinking their 2025 financial guidance and hitting pause on any more stock buybacks because they’re expecting costs to go up and Trump’s auto tariffs are throwing a wrench in things.
In the first quarter, GM earned $2.78 per share, adjusted, compared to the $2.74 that was expected. Revenue came in at $44.02 billion, beating the estimate of $43.05 billion. Not too shabby, GM!
Back in January, GM laid out its 2025 guidance without factoring in tariffs. They were looking at a net income of $11.2 billion to $12.5 billion, or $11 to $12 in earnings per share. Adjusted earnings before interest and taxes were expected to be between $13.7 billion and $15.7 billion, or $11 to $12 per share. They were also eyeing adjusted automotive free cash flow of $11 billion to $13 billion.
But CFO Paul Jacobson was all like, “Hold up, the tariffs might mess things up big time, so we gotta take another look at our guidance.” So yeah, they’re basically scrapping the old plan until they figure out what’s going on. Can’t really blame them, things are pretty uncertain with all these tariffs flying around.
GM isn’t officially saying they’re ditching the guidance, but they’re definitely not standing by it until they get a clearer picture of the economic and regulatory landscape. Jacobson didn’t spill the beans on how much the tariffs have cost them so far, or what they’re doing to dodge more costs until they chat with investors later this week.
The Wall Street Journal spilled the tea that Trump might ease up on his auto tariffs, which could be a game-changer for GM. Looks like he’s considering tweaking the tariffs on imported auto parts too. If this all goes down, automakers could get some cash back for those parts, which is a win in their book.
Trump is set to swing by Michigan to celebrate his first 100 days back in the White House. Wonder if he’ll bring some cake?
GM still thinks they might be able to offset a chunk of the North American tariffs, but they’re playing the waiting game for now. The tariffs, along with the steel and aluminum levies, are causing some major headaches for the industry. Analysts are downgrading stocks left and right, including GM’s.
Despite all the tariff drama, GM had a solid first quarter. They raked in $2.78 billion in net income and $3.49 billion in adjusted earnings before interest and taxes. Not too shabby considering the hurdles they’re facing.
Jacobson mentioned they’re holding off on any more stock buybacks until they have a clearer view of the situation. They were planning on a $6 billion repurchase program, but for now, it’s on hold. Capital spending is also up in the air until they know more.
So yeah, GM is in a bit of a pickle with these tariffs, but they’re doing their best to navigate the storm. Let’s hope they can ride it out and come out stronger on the other side.
