Motor industry giant General Motors reported its third-quarter revenue rose by more than $4 billion year-over-year, which CEO Mary Barra credited to higher sales and higher prices for GM’s new car models.
But the company missed Wall Street’s expectations on its bottom line, as lower sales of its light trucks and gas guzzlers in the U.S. pushed gross profit down by more than 30 percent. Analysts were expecting GM to generate $1.22 billion in adjusted earnings per share on $40.9 billion in revenue.
GM’s third-quarter revenue of $40.7 billion was $1.5 billion higher than the previous quarter, and 6 percent higher than last year’s third quarter, although that was largely due to the impact of the company’s 2015 acquisition of Ally Financial, according to GM. Sales in North America were down 0.9 percent from last year, while they were up by roughly 2 percent in China and 2.3 percent internationally.
GM said it continues to boost sales of its new electric Chevrolet Bolt. The company has said that it sold more than 4,000 electric Bikes over the last year through a new program that includes a program in which buyers can get discounts by swapping their old vehicle for one that has been fully charged for 30 days. The company said it plans to roll out the program to other vehicles next year.
Barra said GM, like the rest of the industry, continues to be under pressure from a supply chain squeeze due to the lack of memory chips that manufacturers can use for computer chips. GM also has not been able to pass the lower price of gasoline to consumers in a meaningful way. The company is hoping the introduction of more EVs will help mitigate that industrywide problem.
GM’s stock price dropped nearly 3 percent on Wednesday, but it rose back up on Thursday in anticipation of Friday’s earnings report.