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• GM maintained its earnings expectations for 2022 despite supply chain instability
General Motors (NASDAQ: GM) upheld its earnings expectations for 2022 despite posting a lower profit and revenue for the first quarter of 2022, as compared to a year ago.
The company’s revenue was reported as $35.98 billion, lower than the market estimate of $37.01 billion. Adjusted earnings were reported as $2.09 per share as compared to the analysts’ estimate of $1.68 per share.
The automobile manufacturer raised its net income expectations from between $9.4 billion and $10.8 billion to $9.6 billion and $11.2 billion
GM’s first-quarter profit margin was 8.2%, down from 9.3% a year earlier.
Unadjusted net income slipped to $2.9 billion for the first quarter compared with $3 billion a year earlier. The automaker reported pretax adjusted earnings of $4 billion for the first quarter, down from $4.4 billion a year earlier.
Shares of the company are down roughly 34% in 2022. Its market cap has fallen from more than $90 billion at the beginning of the year to about $55 billion currently.
GM is the first automaker to report its quarterly earnings. The auto industry is now battling inflation and has been plagued by supply chain issues due to lockdowns for more than a year. Strained supplies of crucial semiconductor chips that are used in vehicles have weighed heavily on the auto industry.
Unlike other auto manufacturers, GM hasn’t been substantially impacted by the Russia-Ukraine war but fresh lockdowns in China are a cause of concern.
GM CEO Mary Barra said the company is “cautiously optimistic” regarding its production in China, as the government has labeled auto manufacturing essential operations during lockdowns.
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Source: GM