SerpApi.Org
General Motors reported better-than-expected second-quarter earnings on Tuesday, with an assist from stock repurchases, sending the stock higher on Tuesday.
For the quarter, GM announced an adjusted operating profit of $3.9 billion from sales of $48 billion. Wall Street was looking for $3.7 billion and $47 billion, respectively, according to FactSet.
A year ago, GM reported quarterly operating profit of $3 billion from sales of $47.1 billion. Tariffs cost the company $1.1 billion in the second quarter of 2025. That number was “reduced” in the current quarter, according to the company. The total tariff impacts on GM remain significant, but GM has had a year to offset costs.
Earnings per share were $3.57, better than the $3.19 forecast by analysts. Part of the reason for the earnings beat is a lower share count. GM has been buying back stock. Now, there are fewer than 900 million average shares outstanding, down from about 960 million a year ago.
GM spent about $2.8 billion in the first half of 2026, retiring about 36 million shares. The company has $3.5 billion remaining on its current repurchase authorization.
For the full year, GM now expects operating profit of between $14 billion and $16 billion. The prior range was $13.5 billion to $15.5 billion. Wall Street currently projects $14.8 billion.
Earnings per share are expected to be about $13, up from prior guidance of $12.50. Wall Street currently projects $12.97.
Numbers look solid, boosted by strong demand for trucks. GM stock rose 4.9% to $79.52 on Tuesday, while the S&P 500 and Dow Jones Industrial Average gained 0.9% and 0.7%, respectively.
Despite Tuesday’s gain, investors don’t seem to know what to do with the stock. Coming into Tuesday trading, GM shares were down about 7% year to date, despite rising earnings estimates and a solid first-quarter earnings report. What’s more, GM stock trades for less than six times estimated 2026 earnings, a multiple that, when combined with the price action, seems to indicate investors expect something bad on the horizon.
Nothing has materialized yet. Perhaps the most important thing GM management can do in the coming months is convince investors that the outlook is stable or improving. And if it can’t, at least there are those buybacks.
Write to Al Root at [email protected]