-- General Motors (GM) raised its full-year earnings outlook and trimmed its tariff hit forecast on Tuesday, as the automaker reported an unexpected year-over-year increase in its first-quarter bottom line.
The company now anticipates adjusted earnings to be in a range of $11.50 to $13.50 per share for 2026, up from its previous guidance of $11 to $13. The current consensus on FactSet is for non-GAAP EPS of $12.20.
GM now sees gross tariff costs of between $2.5 billion and $3.5 billion for the current year, compared with its prior expectations of $3 billion to $4 billion, citing a favorable adjustment of $500 million related to the US Supreme Court's decision in February to invalidate President Donald Trump's reciprocal tariffs imposed under the International Emergency Economic Powers Act.
The company opted to maintain its full-year adjusted automotive free cash flow forecast range of $9 billion to $11 billion, as the cash refund timing of the IEEPA adjustment is uncertain, it said in an earnings presentation.
Chief Executive Mary Barra and company "continue to navigate this very difficult tariff and (electric vehicle) environment while tapping into alternative revenue streams with high margins to stabilize its margins," Wedbush Securities said in a client note. The brokerage maintained its outperform rating on the automaker's stock.
GM posted adjusted EPS of $3.70 for the March quarter, up from $2.78 the year before, defying the Street's view for a decline to $2.60. Revenue slipped 0.9% to $43.62 billion, but came in ahead of the average analyst estimate of $43.51 billion.
"In the first quarter of 2026, General Motors once again delivered strong financial performance," Barra said in a letter to shareholders. "We have solid momentum in our core operations."
Revenue in North America decreased to $36.4 billion from $37.39 billion in the 2025 quarter, while international sales advanced to $2.86 billion from $2.43 billion. Consolidated vehicle sales dropped to 1.29 million units from 1.45 million last year, with sales in the US market falling to 626,000 vehicles from 693,000.
"We are clearly operating in a very dynamic environment, which isn't unusual for this industry," according to Barra. "That's why we have had a multi-year focus to ensure we have the right products, the right team, and a strong balance sheet supported by healthy cash flows to achieve our long-term goals."