General Motors released its second quarter earnings report before opening bell this morning, posting earnings of $1.29 per share, a remarkable 122% growth rate year over year, on $38.2 billion in revenue, a 3.5% year over year decline. Analysts had been expecting earnings of $1.08 per share on revenue of $40.62 billion.
Shares of GM surged in premarket trading immediately following this morning’s earnings release.
Key metrics from GM’s earnings report
Included in the items from the second quarter was $0.6 billion in connection with the devaluation of the Venezuelan bolivar. GM also listed $0.1 for an adjustment to the cost estimates for the compensation program for those affected by the faulty ignition switches.
GM’s North America division recorded $2.8 billion in adjusted EBIT and an adjusted EBIT margin of 10.5%. In last year’s second quarter, the automaker posted adjusted EBIT of $1.4 billion. This year’s results include $0.2 billion in restructuring expenses, while last year’s result included $1 billion of expenses related to recalls.
The strong year over year growth was the result of a higher mix of more expensive and more profitable crossovers and SUVs sold to U.S. consumers. The Chevrolet brand did especially well during the quarter, with 228,000 Chevy cars, 220,000 Chevy trucks, and 128,000 Chevy crossover vehicles being sold through retail.
GM still struggling for breakeven internationally
The Europe segment reported flat adjusted EBIT, compared with last year’s -$0.3 billion adjusted EBIT. Last year’s number included restructuring costs of $0.2 billion. GM’s International Operation recorded adjusted EBIT of $0.3 billion, which was flat with last year and included equity income of $0.5 billion in China. The South America division saw adjusted EBIT of -$0.1 billion, which was flat with last year. GM Financial recorded $0.2 billion in earnings before tax, compared to last year’s $0.3 billion.
As of this writing, shares of General Motors were up 7.1% at $32.44 per share in premarket trades.