General Motors ended the fourth quarter with stronger-than-expected earnings.
The Detroit automaker beat Wall Street profit estimates, lifted shareholder payouts, and issued guidance pointing to another solid year ahead.
At the same time, GM’s results laid bare the cost of scaling back its electric vehicle ambitions and restructuring its China operations, which together triggered billions of dollars in special charges.
Earnings beat offset softer revenue
GM reported adjusted earnings per share of $2.51 for the fourth quarter, comfortably above analyst expectations of $2.20, according to LSEG data.
Revenue came in at $45.29 billion, slightly below the $45.8 billion consensus forecast.
While the revenue miss highlighted ongoing pressures in the global auto market, the profit beat signalled tighter cost control and more disciplined execution.
On an adjusted basis, the automaker delivered earnings before interest and taxes of $2.8 billion for the quarter.
However, headline results were weighed down by significant one-off items, which pushed GM into a net loss despite the stronger underlying performance.
EV pullback drives heavy charges
GM posted a net loss attributable to stockholders of $3.3 billion in the fourth quarter, driven by more than $7.2 billion in special charges.
These were largely linked to the company’s decision to pull back from parts of its electric vehicle strategy and to ongoing restructuring efforts in China.
Earlier this month, GM had already pre-announced $7.1 billion of the charges.
Additional items included $357 million related to legal matters involving OnStar and airbags, $5 million tied to its recent headquarters move, and $133 million associated with its defunct Cruise robotaxi business.
The company said it continues to reassess its product portfolio after incurring billions of dollars in write-downs tied to all-electric vehicles, signalling a more cautious and flexible approach going forward.
Guidance points to steady performance
Despite the quarterly loss, GM’s full-year guidance suggested confidence in its earnings power once restructuring costs ease.
For 2026, the automaker forecast net income attributable to stockholders of between $10.3 billion and $11.7 billion.
It also guided for adjusted EBIT of $13 billion to $15 billion and earnings per share in the range of $11 to $13.
The adjusted EPS target broadly matches analyst expectations of $11.73 per share, based on LSEG consensus.
GM said the guidance assumes spending of between $10 billion and $12 billion, reflecting continued investment alongside tighter capital discipline.
For 2025, the company reported net income attributable to stockholders of $2.7 billion, or $3.27 per share.
Adjusted EBIT reached $12.7 billion, equivalent to $10.60 per share, while adjusted automotive free cash flow totalled $10.6 billion.
The board also approved a new $6 billion share repurchase authorisation and raised the quarterly common stock dividend by 3 cents to 18 cents per share, marking a 20% increase.
The buyback continues GM’s effort to shrink its outstanding shares. By the end of last year, the automaker had 904 million shares outstanding, down from 995 million at the end of the previous year and 1.2 billion at the end of 2023.
Management has positioned the reduced share base as a way to support earnings per share and shareholder value.
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