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General Motors (NYSE:GM) missed analysts’ expectations for Q2 earnings, sending the company’s stock down more than 1% in premarket trading.
However, the automaker reiterated its previous earnings guidance for the full year, claiming it feels confident about boosting production in the second half of 2022.
GM reported Q2 adjusted earnings per share of $1.14, down from $1.97 in the year-ago period and missing the consensus estimates of $1.20 per share. Revenue came in at $35.76 billion, compared to $34.17 billion in the year-ago quarter and analysts’ estimates of $33.58 billion.
Adjusted EBIT hit $2.34 billion in the quarter, compared to $4.12 billion in the same quarter last year. The adjusted EBIT margin stood at 6.6%, down from 11.2% in the previous quarter and 12% in the year-ago period.
The company said it failed to meet consensus estimates as it was unable to ship almost 100,000 vehicles by the end of the three-month period due to parts shortages.
“We have been operating with lower volumes due to the semiconductor shortage for the past year, and we have delivered strong results despite those pressures,” said GM CEO Mary Barra.
Speaking about the macro concerns, Barra said GM is “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 have also modeled many downturn scenarios and we are prepared to take deliberate action when and if necessary,” she added.
A Wedbush analyst said GM delivered “in-line” results.
“It’s time to walk the walk and not just talk the talk for GM as patience is wearing thin on the Street around the name… This is a major “fork in the road” 6-9 months ahead for GM to show strong execution on its key EV strategy despite macro headwinds and a supply chain crisis that remains front and center. Any further shortfalls and stumbles could start to derail the broader EV strategy as the company heads into a pivotal year ahead,” the analyst said in a client note.
