GM's Q4 Earnings Preview: Strong Performance amidst Challenges

Summary:

General Motors (GM) is set to release its fourth quarter and full-year 2024 financial results on Tuesday morning. Analysts anticipate continued strong financial performance, driven by robust sales of trucks and SUVs and growing momentum in its EV segment. Despite these positives, GM faces ongoing challenges, including supply chain constraints, competition in the EV market, and geopolitical risks.

Revenue and Earnings Projections:

* Revenue: $44.46 billion (estimated)
* Adjusted EPS: $1.83 (estimated)
* Adjusted net income: $1.954 billion (estimated)

Full-Year Performance Update:

Following its Q3 results in October, GM revised its full-year guidance:

* Adjusted EBIT: $14 billion to $15 billion
* Automotive operating cash flow: $22 billion to $24 billion
* Adjusted automotive free cash flow: $12.5 billion to $13.5 billion
* Diluted-adjusted EPS: $10 to $10.50

Key Drivers of Performance:

* Strong sales in the US, particularly full-size pickups and SUVs
* Positive contribution from its EV business
* Share repurchase plans boosting share price

Challenges Ahead:

* Continued constraints on EV production
* Intense competition in the EV market
* Risks associated with international trade and regional issues

EV Segment Update:

* GM aims for EV profitability based on variable profit margin
* EV production volume forecast revised to 200,000 units
* $2 billion to $4 billion in cost reductions targeted for 2025

Other Highlights:

* Wind-down of autonomous Cruise business
* $5 billion writedown in China operations

Investor Outlook:

Investors will closely monitor GM's results for insights into its EV strategy, autonomous technology advancements, and geopolitical risks. Guidance on these issues will be key to assessing the company's near-term prospects.