GM Reports Third-Quarter 2021 Results
General Motors Co. (NYSE: GM) reported its third-quarter 2021 earnings, revealing a notable decline in revenue to $26.8 billion from $35.5 billion in Q3 2020. Net income dropped to $2.4 billion compared to $4.0 billion the previous year. However, the company expects full-year EBIT-adjusted earnings to approach the upper range of its guidance. Automotive operating cash flow plunged to $(2.6) billion, and adjusted free cash flow was $(4.4) billion. Despite these challenges, GM's overall financial performance remained strong, bolstered by a recall cost recovery agreement with LG Electronics and robust results at GM Financial.
- Full-year EBIT-adjusted earnings expected at the high end of guidance.
- Strong financial results at GM Financial.
- China equity income increased to $270 million.
- Revenue decreased by $8.7 billion year-over-year.
- Net income fell by $1.6 billion compared to last year.
- Automotive operating cash flow dropped by $12.5 billion.
DETROIT, Oct. 27, 2021 /PRNewswire/ -- General Motors Co. (NYSE: GM) today reported third-quarter earnings that include strong price and mix performance in North America, the benefit of the company's recall cost recovery agreement with LG Electronics and the continued strong financial results at GM Financial. As a result, the company is on track to deliver full-year 2021 EBIT-adjusted earnings approaching the high end of its guidance range.
Downloads
- GM Chair and CEO Mary Barra's letter to shareholders
- Detailed quarterly results with year-over-year comparisons
Results overview
Three Months Ended | |||||||||
($M) except where noted | September 30, | September 30, | Change | ||||||
Revenue | $ | 26,779 | $ | 35,480 | $ | (8,701) | |||
Net income attributable to stockholders | $ | 2,420 | $ | 4,045 | $ | (1,625) | |||
EBIT-adjusted | $ | 2,922 | $ | 5,284 | $ | (2,362) | |||
Net income margin | 9.0 | % | 11.4 | % | (2.4) ppts | ||||
EBIT-adjusted margin | 10.9 | % | 14.9 | % | (4.0) ppts | ||||
Automotive operating cash flow | $ | (2,602) | $ | 9,935 | $ | (12,537) | |||
Adjusted automotive free cash flow | $ | (4,385) | $ | 9,122 | $ | (13,507) | |||
EPS-diluted(a) | $ | 1.62 | $ | 2.78 | $ | (1.16) | |||
EPS-diluted-adjusted(a) | $ | 1.52 | $ | 2.83 | $ | (1.31) | |||
GMNA EBIT-adjusted | $ | 2,125 | $ | 4,366 | $ | (2,241) | |||
GMNA EBIT-adjusted margin | 10.3 | % | 15.0 | % | (4.7) ppts | ||||
GMI EBIT-adjusted | $ | 229 | $ | 10 | $ | 219 | |||
China equity income | $ | 270 | $ | 262 | $ | 8 | |||
GM Financial EBT-adjusted | $ | 1,093 | $ | 1,207 | $ | (114) | |||
__________ | |
(a) | EPS-diluted and EPS-diluted-adjusted include a |
Nine Months Ended | |||||||||
($M) except where noted | September 30, | September 30, | Change | ||||||
Revenue | $ | 93,420 | $ | 84,967 | $ | 8,453 | |||
Net income attributable to stockholders | $ | 8,278 | $ | 3,581 | $ | 4,697 | |||
EBIT-adjusted | $ | 11,456 | $ | 5,998 | $ | 5,458 | |||
Net income margin | 8.9 | % | 4.2 | % | 4.7 ppts | ||||
EBIT-adjusted margin | 12.3 | % | 7.1 | % | 5.2 ppts | ||||
Automotive operating cash flow | $ | 309 | $ | 2,276 | $ | (1,967) | |||
Adjusted automotive free cash flow | $ | (3,839) | $ | (823) | $ | (3,016) | |||
EPS-diluted(a) | $ | 5.55 | $ | 2.40 | $ | 3.15 | |||
EPS-diluted-adjusted(a) | $ | 5.73 | $ | 2.96 | $ | 2.77 | |||
GMNA EBIT-adjusted | $ | 8,153 | $ | 6,459 | $ | 1,694 | |||
GMNA EBIT-adjusted margin | 11.0 | % | 9.7 | % | 1.3 ppts | ||||
GMI EBIT-adjusted | $ | 552 | $ | (811) | $ | 1,363 | |||
China equity income | $ | 854 | $ | 264 | $ | 590 | |||
GM Financial EBT-adjusted | $ | 3,856 | $ | 1,663 | $ | 2,193 | |||
__________ | |
(a) | EPS-diluted and EPS-diluted-adjusted include a |
2021 guidance
- Full-year EPS-diluted of between
$5.52 and$6.52 , and EPS-diluted-adjusted of between$5.70 and$6.70 - Full-year net income of between
$8.1 billion and$9.6 billion , and EBIT-adjusted of between$11.5 billion and$13.5 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.
Conference call for investors and analysts
Mary Barra and Chief Financial Officer Paul Jacobson will host a conference call for investors and analysts at 10 a.m. ET today to discuss these results and the company's growth strategy. Introductory remarks will be followed by a question-and-answer session.
Those who wish to listen to the call may dial in using the following numbers:
- United States: 1-888-808-8618
- International: +1-949-484-0645
- Name of call: GM Earnings Call
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 vehicle safety and security services, 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. Forward-looking statements represent our current judgement about possible future events and are often identified by words such as "anticipate," "appears," "approximately," "believe," "continue," "could," "designed," "effect," "estimate," "evaluate," "expect," "forecast," "goal," "initiative," "intend," "may," "objective," "outlook," "plan," "potential," "priorities," "project," "pursue," "seek," "should," "target," "when," "will," "would," or the negative of any of those words or similar expressions. 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 judgements 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 (loss) attributable to stockholders under U.S. GAAP to EBIT (loss)-adjusted (dollars in millions): |
Three Months Ended | Nine Months Ended | |||||||||||
September 30, | September 30, | September 30, | September 30, | |||||||||
Net income (loss) attributable to stockholders(a) | $ | 2,420 | $ | 4,045 | $ | 8,278 | $ | 3,581 | ||||
Income tax expense (benefit) | 152 | 887 | 2,300 | 1,132 | ||||||||
Automotive interest expense | 230 | 327 | 723 | 823 | ||||||||
Automotive interest income | (38) | (51) | (102) | (195) | ||||||||
Adjustments | ||||||||||||
Cadillac dealer strategy(b) | 158 | — | 175 | — | ||||||||
GMI restructuring(c) | — | 76 | — | 657 | ||||||||
GM Korea wage litigation(d) | — | — | 82 | — | ||||||||
Total adjustments | 158 | 76 | 257 | 657 | ||||||||
EBIT (loss)-adjusted | $ | 2,922 | $ | 5,284 | $ | 11,456 | $ | 5,998 | ||||
__________ | |
(a) | Net of net loss attributable to noncontrolling interest. |
(b) | These adjustments were excluded because they relate to strategic activities to transition certain Cadillac dealers from the network as part of Cadillac's electric vehicle strategy. |
(c) | These adjustments were excluded because of a strategic decision to rationalize our core operations by exiting or significantly reducing our presence in various international markets to focus resources on opportunities expected to deliver higher returns. These adjustments primarily consist of supplier claims in the three months ended Sept. 30, 2020 and dealer restructurings, asset impairments, inventory provisions, employee separation charges and sales allowances in the nine months ended Sept. 30, 2020 in Australia, New Zealand and Thailand. |
(d) | This adjustment was excluded because of the unique events associated with recent Supreme Court of Korea decisions related to our salaried workers. |
The following table reconciles diluted earnings (loss) per common share under U.S. GAAP to EPS-diluted-adjusted (dollars in millions, except per share amounts): |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||
September 30, 2021 | September 30, 2020 | September 30, 2021 | September 30, 2020 | |||||||||||||||||||||
Amount | Per Share | Amount | Per Share | Amount | Per Share | Amount | Per Share | |||||||||||||||||
Diluted earnings (loss) per common share | $ | 2,375 | $ | 1.62 | $ | 4,005 | $ | 2.78 | $ | 8,141 | $ | 5.55 | $ | 3,446 | $ | 2.40 | ||||||||
Adjustments(a) | 158 | 0.11 | 76 | 0.05 | 257 | 0.18 | 657 | 0.46 | ||||||||||||||||
Tax effect on adjustment(b) | (39) | (0.03) | (14) | — | (43) | (0.03) | (82) | (0.06) | ||||||||||||||||
Tax adjustment(c) | (271) | (0.18) | — | — | 45 | 0.03 | 236 | 0.16 | ||||||||||||||||
EPS-diluted-adjusted | $ | 2,223 | $ | 1.52 | $ | 4,067 | $ | 2.83 | $ | 8,400 | $ | 5.73 | $ | 4,257 | $ | 2.96 | ||||||||
__________ | |
(a) | Refer to the reconciliation of Net income (loss) attributable to stockholders under U.S. GAAP to EBIT (loss)-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) | These adjustments consist of tax benefit related to a deduction for an investment in a subsidiary in the three months ended Sept. 30, 2021 and tax expense related to the establishment of a valuation allowance against Cruise deferred tax assets in the nine months ended Sept. 30, 2021, and tax expense related to the establishment of a valuation allowance against deferred tax assets that are considered no longer realizable for GM in Australia and New Zealand for the nine months ended Sept. 30, 2020. |
The following table reconciles net automotive cash provided by (used in) operating activities under |
U.S. GAAP to adjusted automotive free cash flow (dollars in millions): |
Three Months Ended | Nine Months Ended | |||||||||||
September 30, 2021 | September 30, 2020 | September 30, 2021 | September 30, 2020 | |||||||||
Net automotive cash provided by (used in) | $ | (2,602) | $ | 9,935 | $ | 309 | $ | 2,276 | ||||
Less: Capital expenditures | (1,829) | (980) | (4,235) | (3,292) | ||||||||
Add: Cadillac Dealer Transition | 27 | — | 44 | — | ||||||||
Add: GMI restructuring | — | 167 | 24 | 251 | ||||||||
Add: GM Korea Wage Litigation | 19 | — | 19 | — | ||||||||
Less: GM Brazil indirect tax recoveries | — | — | — | (58) | ||||||||
Adjusted automotive free cash flow | $ | (4,385) | $ | 9,122 | $ | (3,839) | $ | (823) | ||||
Guidance Reconciliations
The following table reconciles expected Net income (loss) attributable to stockholders under U.S. GAAP to expected EBIT-adjusted (dollars in billions): | |
Year Ending | |||
Net income attributable to stockholders | $ | 8.1-9.6 | |
Income tax expense | 2.3-2.8 | ||
Automotive interest expense, net | 0.8 | ||
Adjustments(a) | 0.3 | ||
EBIT-adjusted(b) | $ | 11.5-13.5 | |
__________ | |
(a) | Refer to the reconciliation of Net income (loss) attributable to stockholders under U.S. GAAP to EBIT (loss)-adjusted for adjustment details. |
(b) | We do not consider the potential future impact of adjustments on our expected financial results. |
The following table reconciles expected EPS-diluted under U.S. GAAP to expected EPS-diluted-adjusted: |
Year Ending | |||
Diluted earnings per common share | $ | 5.52-6.52 | |
Adjustments(a) | 0.18 | ||
EPS-diluted-adjusted(b) | $ | 5.70-6.70 | |
__________ |
(a) | Refer to the reconciliation of diluted earnings (loss) per common share under U.S. GAAP to EPS-diluted-adjusted for adjustment details. |
(b) | We do not consider the potential future impact of adjustments on our expected financial results. |
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SOURCE General Motors Co.
FAQ
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