GM Beats Wall Street Expectations Despite $1.1B Tariff Blow, Still Confident in 2025 Outlook

General Motors just posted a bumpy second quarter, with profits down 35% — thanks in large part to a $1.1 billion punch from tariffs. Still, the company managed to beat Wall Street estimates and is sticking to its full-year forecast, even after revising it down in May.

In a letter to shareholders Tuesday, GM CEO Mary Barra struck a confident tone, calling the company’s underlying performance “strong” and pointing to $4 billion in fresh investments in U.S. assembly plants as part of a bigger push to cut tariff exposure.

“We’re working to greatly reduce our tariff exposure,” Barra wrote, saying GM is positioning itself for a “profitable, long-term future” amid shifting trade and tax rules and a tech landscape that’s moving fast.

On a call with analysts, Barra said GM expects to produce more than 2 million vehicles annually in the U.S. as it ramps up domestic production — a clear pivot to reduce reliance on overseas manufacturing and ride out the storm of Trump-era tariffs.

Chief Financial Officer Paul Jacobson echoed that optimism, saying GM is making solid headway in offsetting 30% or more of the $4–5 billion in gross tariff impacts it expects this year through smart manufacturing shifts, cost cuts, and pricing moves.

“Over time, we remain confident that our total tariff expense will come down as bilateral trade deals emerge and our sourcing and production adjustments are implemented,” Jacobson said.

For the quarter ending June 30, GM pulled in $1.89 billion in net income — down from $2.93 billion a year ago. Earnings per share came in at $1.91, or $2.53 excluding some items — comfortably topping analysts’ $2.34 forecast (per FactSet).

Revenue dropped a bit to $47.12 billion from $47.97 billion but still came in above Wall Street’s expected $45.84 billion.

Jacobson also pointed to higher warranty costs during the quarter, mostly tied to software-related issues in early EV models. GM has extended warranties where needed and says it’s tightening up supplier quality to reduce future hiccups.

With input from The AP News