Shares of General Motors Co. $(GM)$ surged 3.7% in premarket trading, after the automaker reported first-quarter profit that was more than double what was expected, while revenue surprisingly declined and the full-year outlook was a bit shy of forecasts.
General Motorson Wednesday reported first-quarter results that easily beat Wall Street earnings expectations, saying it expected a strong first half of the year despite an ongoing global semiconductor chip shortage that has caused factory closures.
Here’s how GM did compared with what Wall Street expected based on average estimates compiled by Refinitiv.
Adjusted EPS:$2.25, vs. $1.04 expected based on average analysts’ estimates compiled by Refinitiv.
Revenue:$32.47 billion, vs. $32.67 billion expected.
GM reaffirmed its earnings guidance for the year. The company forecast between $10 billion and $11 billion, or $4.50 to $5.25 per share, in adjusted pretax profits and adjusted automotive free cash flow of $1 billion to $2 billion for 2021. The forecasts factored in the potential impact of an ongoing global semiconductor chip shortage, including a hit of $1.5 billion to $2 billion to earnings and a decrease of $1.5 billion to $2.5 billion to its free cash flow.
At the end of the first quarter, GM CFO Paul Jacobson told investors he was“increasingly confident”that the automaker would achieve its earnings targets for the year despite the chip shortage.
Aside from earnings, Wall Street is looking to CEO Mary Barra and other executives for insight into a number of other issues – from updates to its 2021 guidance and an ongoing global shortage of semiconductor chips to its electric and autonomous vehicles.
GM reported an adjusted pretax profit of $1.3 billion, or 62 cents per share,in the first quarter of 2020as the coronavirus began shutting down factories. Revenue was $32.7 billion during that quarter. On an unadjusted basis, net income was $2.2 billion.