GM Q4 2019 Earnings: $194 Million Loss On $30.8 Billion Revenue
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General Motors Company has reported its fourth quarter 2019 financial performance today. The Q4 2019 earnings were headlined by a $194 million loss on $30.8 billion in revenue. Compared to the fourth quarter of 2018, these results represent a 109.3 percent decline in income and a 19.7 percent decrease in revenue.
Other top-line GM Q4 2019 metrics were as follows::
- Automotive operating cashflow was $0.8 billion, down $5.5 billion or 130 percent
- Earnings per share diluted was $(0.16), down $1.56 or 111.4 percent
- EBIT-adjusted margin was 0.3 percent, down 7 percentage points
- EBIT-adjusted was $0.1 billion, down $2.7 billion or 96 percent
- Adjusted Automotive free cash flow was $(1.3) billion, down 5.5 billon or 130.95 percent
- Adjusted EPS diluted was $0.05, down $1.38 or 96.5 percent
GM Q4 2019 Earnings Summary
Figures in billions of USD, except for per share amounts and percentages.| METRIC | Q4 2019 | Q4 2018 | Q4 2019 - Q4 2018 (IN $) | % CHANGE Q4 2019 / Q4 2018 (IN %) |
|---|---|---|---|---|
| GAAP METRICS | ||||
| NET REVENUE | $30.80 | $38.40 | -7.60 | -19.79% |
| INCOME | $(0.20) | $2.10 | -2.30 | -109.52% |
| AUTOMOTIVE OPERATING CASH FLOW | $0.80 | $6.30 | -5.50 | -130.95% |
| EARNINGS PER SHARE (EPS) DILUTED | $(0.16) | $1.40 | -1.56 | -111.43% |
| NON GAAP METRICS | ||||
| % EBIT-ADJUSTED MARGIN | 0.30% | 7.40% | -0.07 | -95.95% |
| EBIT-ADJUSTED | $0.10 | $2.80 | -2.70 | -96.43% |
| ADJUSTED AUTOMOTIVE FREE CASH FLOW | $(1.30) | $4.20 | -5.50 | -130.95% |
| EPS DILUTED - ADJUSTED | $0.05 | $1.43 | -1.38 | -96.5% |
Segment Results
Here’s how GM’s four segments performed during the fourth quarter of 2019:
- GM North America: $263 million profit vs. $3 billion profit in Q4 2018.
- GM International: $120 million loss vs. $48 million loss in Q4 2018.
- China equity income was $237 million vs. $305 million in Q4 2018.
- GM Financial: $498 million in profit vs. $416 million in Q4 2018.
- GM Cruise: $305 million loss vs. $194 million loss in Q4 2018.
Strike Impact
GM said that its performance was “heavily impacted by a work stoppage in the third and fourth quarters.” The stoppage in question, orchestrated by the UAW, lasted 40 days, disrupting production of GM vehicles, as well as parts. In the fourth quarter, four weeks of vehicle production were lost as a result of the strike, reducing sales by 191,000 units year-over-year. The net strike impact to fourth quarter EBIT-adjusted was $(2.6) billion, or $(1.39) per diluted-adjusted share.
GM added that the underlying performance of its business “remained strong”, driven by sales of GM’s all-new full-size pickups and the company’s ongoing cost actions.
Full-Size Truck Update
GM announced that the final variants of the Chevrolet Silverado and GMC Sierra heavy-duty pickups launched in the fourth quarter of 2019, complementing its full-size pickup truck lineup. GM says that it will benefit from a full year of these highly-profitable vehicles in 2020.
During the fourth quarter, U.S. sales of the Chevrolet Silverado increased 1.34 percent to 163,341 units while GMC Sierra sales increased 2 percent to 68,722 units. Combined sales of both full-size pickup truck lines increased 1.56 percent to 232,063 units. Adding in sales of GM’s midsize pickup trucks, the Chevrolet Colorado and GMC Canyon, GM sold a total of 264,072 pickup trucks in the United States during Q4 2019, second to Ford’s 267,011 units.
All-Electric Future
GM emphasized its commitment to an all-electric future. In January, the Detroit-based automaker announced a $2.2 billion investment in the GM Detroit-Hamtramck plant to produce a full lineup of all-electric trucks and SUVs for multiple brands and customers, including the upcoming GMC HUMMER EV, which the automaker teased during the Super Bowl LIV in ads starring NBA great LeBron James. Production of GM electric pickup trucks is scheduled to begin in the fall of 2021.
In December, GM and LG Chem announced a joint venture to produce battery cells in a new plant in Lordstown, Ohio. GM says that “the
new venture will make EVs more affordable for customers by reducing battery costs to industry-leading levels,” , while the facility’s capacity will be more than 30 gigawatt hours. The joint venture will create about 1,100 jobs.
In May, GM announced a collaboration with Bechtel for an EV fast-charging station network. The duo is “making progress on an aggressive plan to build and deploy thousands of stations throughout the U.S.” The network is expected to begin service by 2021.
In March, GM announced a $300 million investment in its Orion assembly plant in Michigan to produce a new Chevrolet electric vehicle. Believed to be the Chevrolet Bolt EUV, the undertaking will bring 400 new jobs to the facility.
We will have a lot more on GM’s earnings results shortly, so be sure to subscribe to GM Authority for more GM financial news, GM business news, and around-the-clock GM news coverage.
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Omg will gm ever be in first place when it comes to truck sales and iam not talking about combining them I dont think I will live long enough to see it if they dont try to do everything to be number 1 I can’t wait to hear how they doing financially at the end of the year they going to be hurting even more when the new pos f150 come out
Silverado king of the trucks.
Ford went heavy on aluminum. Improved the truck in many ways, but aluminum is expensive. They needed to cut corners to keep the price low. It’s not as good of a work truck as it used to be.
RAM improved it’s truck as well, but it still has reliability problems. Plus CDJR sales have been strong. The service department at my local dealership is overwhelmed. If you have a problem with your vehicle they tell you “drop it off in the morning we’ll try and get to it before the end of the day.
Toyota hasn’t built a new fullsized truck in 20 years. Next year their going to try. Little secret Toyota has quality issues just like everyone else, but by keeping a lot of outdated debugged models in their lineup brand reliability remains strong. All of which doesn’t bode well for the new trucks.
So if I’m buying a truck it comes down to Chevy or GMC, depending on price and options I could go either way.
here is a view of gm through rose colored glasses :
https://www.detroitnews.com/story/business/columnists/daniel-howes/2020/02/06/general-motors-bid-investor-respect-dogged-history/4671119002/
Even with GM dealing with the UAW strike in Q4, they still managed to lose less than Ford did. Ford lost a staggering 1.7B.