General Motors Third-Quarter Earnings More Than Double -- Update
October 25 2016 - 8:16AM
Dow Jones News
By Mike Colias
General Motors Co. doubled its net income and notched record
revenue in the third quarter amid strong truck sales in its home
U.S. market and continued strength in China, but the auto maker
signaled continued weakness in Europe because of Brexit
fallout.
GM on Tuesday posted net income attributable to common
shareholders of $2.77 billion for the period ended Sept. 30, up
from $1.36 billion reported in the same period a year ago. The
Detroit auto maker said operating profit excluding one-time factors
equaled $1.72 a share, breezing past Wall Street expectations of
$1.45 a share.
Revenue rose 10% to $42.83 billion, a quarterly record for the
company. That topped analysts' average forecast of $39.3
billion.
The largest U.S. auto maker by sales benefited from continued
strong pricing on big pickups and SUVs in North America, its most
profitable models, as well as healthier margins on freshly
redesigned cars such as the Chevrolet Malibu. A sales surge in
China, stoked by a government tax incentive, helped offset pricing
pressures from weak demand for small cars and commercial vans.
Operating margins in both North America and China slipped
modestly during the quarter compared with a year ago.
GM posted an operating loss of $142 million in Europe, a quarter
after recording its first profit there in five years. GM said that
fallout from the U.K.'s vote to exit from the European Union shaved
about $100 million from its business in the quarter and that it
expects the drag to be $300 million in the fourth quarter.
The Brexit impact likely will derail GM's longstanding goal of
turning a profit on the continent in 2016, the first time since
1998. Other auto makers, including the Nissan Motor Co./ Renault SA
alliance, have signaled concerns about the U.K.'s auto industry in
recent months.
Write to Mike Colias at Mike.Colias@wsj.com
(END) Dow Jones Newswires
October 25, 2016 08:01 ET (12:01 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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