GM expects strong first half of year despite production interruptions due to chip shortage

Earnings

General Motors employees work on the assembly line at the Fairfax Assembly & Stamping Plant in Kansas City, Kansas.
Jim Barcus for General Motors

General Motors is set to report its first-quarter earnings before the bell on Wednesday. Here’s what Wall Street is expecting, based on average analysts’ estimates compiled by Refinitiv.

  • Adjusted EPS: $1.04
  • Revenue: $32.67 billion

GM’s been weathering ongoing challenges from a global shortage of semiconductor chips, which has caused factory shutdowns and is expected to shave billions off the industry’s earnings in 2021.

GM’s earnings forecast for the year is $10 billion to $11 billion, or $4.50 to $5.25 per share, in adjusted pretax profits and adjusted automotive free cash flow of $1 billion to $2 billion. The forecasts factored in the potential impact of an ongoing global semiconductor chip shortage, including a hit of $1.5 billion to $2 billion to earnings and decrease of $1.5 billion to $2.5 billion to its free cash flow.

At the end of the first quarter, GM CFO Paul Jacobson told investors he was “increasingly confident” that the automaker would achieve its earnings targets for the year despite the chip shortage.

Aside from earnings, Wall Street is looking to CEO Mary Barra and other executives for insight into a number of other issues – from updates to its 2021 guidance and an ongoing global shortage of semiconductor chips to its electric and autonomous vehicles.

GM reported an adjusted pretax profit of $1.3 billion, or 62 cents per share, in the first quarter of 2020 as the coronavirus began shutting down factories. Revenue was $32.7 billion during that quarter.

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