GM posts best 3Q results since exiting bankruptcy
General Motors (GM) earned $2.8 billion in the third quarter, exceeding Wall Street estimates and doubling the year-earlier profit for the period, as North America and China performed well enough to more than offset losses in Europe and South America.
On a per share basis, GM earned $1.72, which exceeded the $1.44 per share average estimate from 16 analysts. It was the company's best third-quarter profit since emerging from its 2009 bankruptcy restructuring.
GM shares (GM) rose 1.3% to $33.42 in pre-market trading.
"Our record third quarter, led by strong performance in the U.S. and China, reflects our determination to deliver earnings that enhance shareholder returns," CEO Mary Barra said in a statement.
Revenue rose 10.3% to $42.8 billion. The revenue performance soared past S&P Global Market Intelligence estimates of $37.6 billion. The company 2.4 million vehicles worldwide during the quarter, a 3.8% increase.
The average price of vehicles GM sold in the U.S. jumped to $35,700, or about 16% higher than the comparable price in the third quarter of 2015.
Yet again, North America accounted for the overwhelming majority of GM's global profit as it earned $3.5 billion before taxes in the U.S., Canada and Mexico, or a profit margin of 11.2%, slightly lower than its 11.8% margin in the year-earlier quarter.
The automaker lost about $142 million before taxes in Europe and $121 million in South America. For its international operations, which includes Asia, Africa and the Middle East, GM's pre-tax profit was $271 million, or roughly flat from the third quarter of 2015. That was bolstered by equity income of about $500 million from GM's joint ventures in China.
GM Financial, which provides loans for customers and financing for dealers, earned $229 million before taxes, slightly less than the $231 million it earned in the third-quarter of 2015.
The company held $21.5 billion of cash and salable securities as of Sept. 30.
"Strong bottom-line performance put us solidly on track to deliver on our annual earnings outlook," Chief Financial Officer Chuck Stevens said in a statement. GM is in the midst of buying back $9 billion of its shares by the end of 2017. About $5 billion of that buyback has been completed.
Follow Detroit Free Press reporter Greg Gardner on Twitter @GregGardner12.