General Motors reported a notable improvement in underlying profitability for the first quarter, driven by strength in the U.S. market and an expected tariff refund tied to a recent Supreme Court decision. The automaker said quarterly earnings before interest and taxes reached $4.3 billion, or $3.70 per share, a figure that represents a 22% increase in core profit and topped analyst expectations of $2.62 per share, according to LSEG data.
Management also raised its profit guidance for 2026, adding $500 million to its outlook - an increment GM said corresponds to the refunds it expects to receive following a U.S. Supreme Court ruling that invalidated portions of tariffs put in place under the prior administration. The company now projects full-year core profit of $13.5 billion to $15.5 billion.
On a net basis, quarterly income declined 6% from the year-earlier period to $2.6 billion. The company attributed the drop primarily to a $1.1 billion charge recorded in the quarter to settle supplier claims arising from reduced electric-vehicle programs. Consolidated revenue for the period was $43.6 billion, down by less than 1% year over year.
GM characterized U.S. consumer demand as resilient amid headwinds. "We are clearly operating in a very dynamic environment, which isn’t unusual for this industry," the CEO said in a statement, referencing ongoing uncertainty that has included tariffs, higher fuel prices and uneven labor-market signals.
Regionally, North America - GM's largest profit center - delivered an improved margin of 10.1% in the quarter, up from 8.8% a year earlier, despite a 10% decline in sales. Company commentary attributed the sales contraction in part to a difficult comparison with the first quarter of 2025, when U.S. buyers accelerated purchases to avoid tariff-related price increases.
GM reported several offsetting cost dynamics that helped support results. The automaker cited cost savings tied to eased U.S. tailpipe emissions regulations and lower warranty expenses as factors that mitigated the impact of softer unit sales on profitability.
Performance outside North America showed mixed improvement. In China, where GM is undertaking a restructuring of its operations, equity income rose to $165 million from $45 million a year earlier. International operations excluding China produced core profit of $123 million, up from $30 million in the comparable prior-year quarter.
The company has also adjusted production plans for electric vehicles in response to weaker demand. GM disclosed that EV sales fell 43% in the final three months of last year, and that in addition to the $1.1 billion first-quarter charge it recorded $7.6 billion of writedowns on its EV programs in the prior year.
Taken together, the quarter reflects a combination of stronger underlying operating profit in key regions, one-time charges tied to supplier settlements and continued restructuring and rebalancing of EV investments. GM's revised guidance incorporates an expected tariff refund and the current operating backdrop reported for the quarter.