Trump tariffs take US$1 billion bite out of GM earnings, shares fall
Automaker’s Q2 results topped expectations, but projections of weaker second-half profitability due to ongoing trade headwinds sent shares down
General Motors’ second-quarter earnings took a US$1.1-billion hit from tariffs, but the automaker still beat analyst expectations for the period on Tuesday, supported by strong sales of its core petrol trucks and SUVs.
The largest US automaker by sales said it expects the tariff impact to worsen in the third quarter and stuck to a previous estimate that trade headwinds threaten to hit the bottom line by US$4 billion to US$5 billion this year. GM said it could take steps to mitigate at least 30 per cent of that impact.
Shares fell 8 per cent.
The automaker’s revenue in the quarter ended June 30 fell nearly 2 per cent to about US$47 billion from a year ago. Its quarterly adjusted earnings per share fell to US$2.53 compared with US$3.06 a year earlier.
Analysts on average expected adjusted profit of US$2.44 per share, according to data compiled by LSEG. Its adjusted earnings before interest and taxes fell 32 per cent to US$3 billion.