GM Q2 Profit Drops 32% Amid Tariff Pressure, Warns of Bigger Hit Ahead

General Motors (GM) reported a sharp 32% decline in second-quarter core profit on Tuesday, attributing the drop largely to escalating tariff challenges. The automaker said tariffs reduced earnings by $1.1 billion during the quarter that ended June 30.

The company posted a core profit of $3 billion, with revenue falling nearly 2% year-on-year to about $47 billion. Adjusted earnings per share declined to $2.53, down from $3.06 a year earlier. Despite the dip, GM still managed to outperform analysts’ expectations, which averaged $2.44 per share, according to data from LSEG. However, the company’s shares fell about 3% in premarket trading.

Looking ahead, GM warned that the impact of tariffs could worsen in the third quarter. The company reaffirmed its earlier forecast that trade-related headwinds may cost between $4 billion and $5 billion this year. GM noted it is exploring measures to offset around 30% of that projected loss.

Earlier in the year, GM had pulled its annual earnings guidance as it assessed the fallout from President Donald Trump’s trade policies. It later reinstated guidance, though at a reduced level—projecting an annual adjusted core profit between $10 billion and $12.5 billion. That range remains unchanged.

Despite the tariff burden, GM’s underlying performance showed resilience. U.S. sales rose 7%, driven by strong pricing on its popular SUVs and pickup trucks. In China, GM returned to profitability after posting a loss during the same period last year.

The company remains focused on cost-saving measures and managing global operations efficiently. Executives emphasized their commitment to navigating trade uncertainty while preserving profitability in key markets.