GM Releases 2023 Second-Quarter Results and Raises Full-Year Earnings Guidance

News provided by

General Motors Co.

Jul 25, 2023, 06:30 ET

DETROIT, July 25, 2023 /PRNewswire/ -- General Motors Co. (NYSE: GM) today reported second-quarter 2023 revenue of $44.7 billion, net income attributable to stockholders of $2.6 billion and EBIT-adjusted of $3.2 billion.

The results include a $792 million charge for new commercial agreements GM has with LG Electronics and LG Energy Solution. The charge reflects the conscious decision GM made during the Chevrolet Bolt EV and Bolt EUV recall to serve customers in ways that go beyond traditional remedies, and GM is taking new steps that will reduce its costs and improve EV margins over time. 

GM is also updating its full-year 2023 guidance for the second consecutive quarter:

  • U.S. GAAP net income attributable to stockholders of $9.3 billion-$10.7 billion, compared to the previous outlook of $8.4 billion-$9.9 billion
  • EBIT-adjusted of $12.0 billion-$14.0 billion, compared to the previous outlook of $11.0 billion-$13.0 billion
  • U.S. GAAP net automotive cash provided by operating activities of $18.0 billion-$21.0 billion, compared to the previous outlook of $16.5 billion-$20.5 billion
  • Adjusted automotive free cash flow of $7.0 billion-$9.0 billion, compared to the previous outlook of $5.5 billion-$7.5 billion
  • Capital expenditures of $11 billion-$12 billion, compared to the previous outlook of $11 billion-$13 billion

See below for reconciliations of non-GAAP measures to their most directly comparable GAAP measures or visit the GM Investor Relations website for complete details.

Downloads

Conference Call for Investors and Analysts

GM Chair and CEO Mary Barra and GM Chief Financial Officer Paul Jacobson will host a conference call for the investment community at 8:30 a.m. ET today to discuss these results. Those who wish to listen to the call may dial in using the following numbers and passcode:

  • United States: 1-800-857-9821
  • International: +1-517-308-9481
  • Conference call passcode: General Motors

Results Overview

 

Six Months Ended

    

($M) except where noted

June 30, 2023

June 30, 2022

Change

% Change

Revenue

$    84,732

$      71,738

$     12,994

18.1 %

Net income attributable to stockholders

$      4,962

$        4,631

$          331

7.1 %

EBIT-adjusted

$      7,037

$        6,387

$          650

10.2 %

Net income margin

5.9 %

6.5 %

(1.0) ppts

(14.5) %

EBIT-adjusted margin

8.3 %

8.9 %

(0.6) ppts

(6.7) %

Automotive operating cash flow

$      9,346

$       5,104

$       4,242

83.1 %

Adjusted automotive free cash flow

$      5,415

$       1,413

$       4,002

283.2 %

EPS-diluted(a)

$        3.52

$         2.49

$         1.03

41.4 %

EPS-diluted-adjusted(a)

$        4.12

$         3.23

$         0.89

27.6 %

GMNA EBIT-adjusted

$      6,769

$       5,440

$       1,329

24.4 %

GMNA EBIT-adjusted margin

9.7 %

9.3 %

0.6 ppts

6.5 %

GMI EBIT-adjusted

$         583

$         537

$           46

8.6 %

China equity income

$         161

$         147

$           14

9.5 %

GM Financial EBT-adjusted

$      1,537

$      2,390

$        (853)

(35.7) %
                                                   

(a)

EPS-diluted and EPS-diluted-adjusted include a $0.13 impact from revaluation on equity investments in the six months ended March 31, 2022.

                              
 

Three Months Ended

    

($M) except where noted

June 30, 2023

June 30, 2022

Change

% Change

Revenue

$    44,746

$     35,759

$       8,987

25.1 %

Net income attributable to stockholders

$      2,566

$       1,692

$          874

51.7 %

EBIT-adjusted

$      3,234

$       2,343

$          891

38.0 %

Net income margin

5.7 %

4.7 %

1.0 ppts

21.3 %

EBIT-adjusted margin

7.2 %

6.6 %

0.6 ppts

0.9 %

Automotive operating cash flow

$      7,114

$      3,469

$       3,645

105.1 %

Adjusted automotive free cash flow

$      5,548

$      1,407

$       4,141

294.3 %

EPS-diluted(a)

$        1.83

$        1.14

$         0.69

60.5 %

EPS-diluted-adjusted(a)

$        1.91

$        1.14

$         0.77

67.5 %

GMNA EBIT-adjusted

$      3,194

$      2,299

$          895

38.9 %

GMNA EBIT-adjusted margin

8.6 %

8.0 %

0.6 ppts

7.5 %

GMI EBIT-adjusted

$         236

$         209

$           27

12.9 %

China equity income

$           78

$          (87)

$         165

n.m.

GM Financial EBT-adjusted

$         766

$      1,106

$        (340)

(30.7) %
                   

(a)

EPS-diluted and EPS-diluted-adjusted include a $(0.03) and $(0.05) impact from revaluation on equity investments in the three months ended June 30, 2023 and June 30, 2022.

(b)

n.m. = not meaningful

General Motors (NYSE:GM) is a global company focused on advancing an all-electric future that is inclusive and accessible to all. At the heart of this strategy is the Ultium battery platform, which powers everything from mass-market to high-performance vehicles. General Motors, its subsidiaries and its joint venture entities sell vehicles under the Chevrolet, Buick, GMC, Cadillac, Baojun and Wuling brands. More information on the company and its subsidiaries, including OnStar, a global leader in safety services and connected vehicle technology, can be found at https://www.gm.com. 

Cautionary Note on Forward-Looking Statements: This press release and related comments by management may include "forward-looking statements" within the meaning of the U.S. federal securities laws. Forward-looking statements are any statements other than statements of historical fact and represent our current judgment about possible future events. In making these statements, we rely upon assumptions and analysis based on our experience and perception of historical trends, current conditions, and expected future developments, as well as other factors we consider appropriate under the circumstances. We believe these judgments are reasonable, but these statements are not guarantees of any future events or financial results, and our actual results may differ materially due to a variety of factors, many of which are described in our most recent Annual Report on Form 10-K and our other filings with the U.S. Securities and Exchange Commission. We caution readers not to place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update publicly or otherwise revise any forward-looking statements, whether as a result of new information, future events, or other factors that affect the subject of these statements, except where we are expressly required to do so by law.

Non-GAAP Reconciliations

The following table reconciles Net income attributable to stockholders under U.S. GAAP to EBIT-adjusted (dollars in millions):
 
 

Three Months Ended

Six Months Ended
 

June 30, 2023

June 30, 2022

June 30, 2023

June 30, 2022

Net income attributable to stockholders(a)

$        2,566

$        1,692

$       4,962

$        4,631

Income tax expense (benefit)

522

490

950

462

Automotive interest expense

226

234

460

460

Automotive interest income

(251)

(73)

(479)

(123)

Adjustments

        

   Voluntary separation program(b)

—

—

875

—

   Cruise compensation modifications(c)

—

—

—

1,057

   Buick dealer strategy(d)

246

—

345

—

   Patent royalty matters(e)

—

—

—

(100)

   GM Korea wage litigation(f)

(76)

—

  

—

Total adjustments

170

—

1,144

957

EBIT-adjusted

$       3,234

$       2,343

$        7,037

$        6,387
                     

(a)

Net of net loss attributable to noncontrolling interests.

(b)

This adjustment was excluded because it relates to the acceleration of attrition as part of the cost reduction program announced in January 2023, primarily in the United States.

(c)

This adjustment was excluded because it relates to the one-time modification of Cruise stock incentive awards.

(d)

These adjustments were excluded because they relate to strategic activities to transition certain Buick dealers out of our dealer network as part of Buick's EV strategy.

(e)

These adjustments were excluded because they relate to certain royalties accrued with respect to past-year vehicle sales in the three months ended December 31, 2021, and the resolution of substantially all of these matters in the three months ended March 31, 2022.

(f)

This adjustment was excluded because it relates to the partial resolution of subcontractor matters in Korea.

The following table reconciles diluted earnings per common share under U.S. GAAP to EPS-diluted-adjusted (dollars in millions, except per share amounts):
 
 

Three Months Ended

Six Months Ended
 

June 30, 2023

June 30, 2022

June 30, 2023

June 30, 2022
 

Amount

Per Share

Amount

Per Share

Amount

Per Share

Amount

Per Share

Diluted earnings per common share

$ 2,540

$   1.83

$  1,666

$    1.14

$ 4,908

$  3.52

$ 3,653

$  2.49

Adjustments(a)

170

0.12

—

—

1,144

0.82

957

0.65

Tax effect on adjustments(b)

(60)

(0.04)

—

—

(299)

(0.21)

(296)

(0.20)

Tax adjustments(c)

—

—

—

—

—

—

(482)

(0.33)

Deemed dividend adjustment(d)

—

—

—

—

—

—

909

0.62

EPS-diluted-adjusted

$ 2,650

$   1.91

$  1,666

$    1.14

$ 5,753

$   4.12

$  4,741

$  3.23
                     

(a)

Refer to the reconciliation of Net income attributable to stockholders under U.S. GAAP to EBIT-adjusted for adjustment details. 

(b)

The tax effect of each adjustment is determined based on the tax laws and valuation allowance status of the jurisdiction to which the adjustment relates. 

(c)

This adjustment consists of tax benefit related to the release of a valuation allowance against deferred tax assets considered realizable as a result of Cruise tax reconsolidation in the six months ended June 30, 2022. This adjustment was excluded because significant impacts of valuation allowances are not considered part of our core operations.

(d)

This adjustment consists of a deemed dividend related to the redemption of Cruise preferred shares from SoftBank in the six months ended June 30, 2022.

The following table reconciles net automotive cash provided by operating activities under U.S. GAAP to adjusted automotive free cash flow

(dollars in millions):
 
 

Three Months Ended

Six Months Ended
 

June 30, 2023

June 30, 2022

June 30, 2023

June 30, 2022

Net automotive cash provided by operating activities

$        7,114

$       3,469

$       9,346

$        5,104

Less: Capital expenditures

(2,136)

(2,073)

(4,544)

(3,717)

Add: Buick dealer strategy

316

—

355

—

Add: Employee separation costs

253

—

258

—

Add: GM Korea wage litigation

—

10

—

26

Adjusted automotive free cash flow

$       5,548

$        1,407

$        5,415

$        1,413

Guidance Reconciliations

The following table reconciles expected Net income attributable to stockholders under U.S. GAAP to expected EBIT-adjusted (dollars in billions):
 
   

Year Ending
December 31, 2023

  

Net income attributable to stockholders

                

$                                           9.3-10.7

                

Income tax expense

                

1.6-2.2

                

Automotive interest expense, net

                

0.0

                

Adjustments(a)

  

1.1

  

EBIT-adjusted

                

$                                        12.0-14.0

                
                     

(a)

Refer to the reconciliation of Net income attributable to stockholders under U.S. GAAP to EBIT-adjusted for the details of each individual adjustment. We do not consider the potential future impact of adjustments on our expected financial results.

The following table reconciles expected automotive net cash provided by operating activities under U.S. GAAP to expected adjusted automotive free cash flow (dollars in billions):
 
 

Year Ending
December 31, 2023

Net automotive cash provided by operating activities

$                                    17.4-20.4

Less: Capital expenditures

11.0-12.0

Adjustments

0.6

Adjusted automotive free cash flow(a)

$                                                 7-9
                     

(a)

We do not consider the potential future impact of adjustments on our expected financial results.

SOURCE General Motors Co.