What happened
Shares of General Motors (GM -0.05%) climbed 8.4% on Tuesday after the auto giant's earnings delighted investors.
So what
GM's revenue rose 28% to $43.1 billion in the fourth quarter. That surpassed Wall Street's estimates, which had called for sales of $40.7 billion.
"GM led the U.S. industry in total sales and delivered the largest year-over-year increase in market share of any OEM [original equipment manufacturer], thanks to strong demand for our products and improved supply chain conditions," CEO Mary Barra said in a letter to shareholders.
GM's Chevrolet and GMC brands maintained their leadership positions in the U.S. pickup and full-size SUV markets. Electric vehicles provided additional areas of strength, with the Chevrolet Bolt EV subcompact car and Bolt EUV crossover enjoying record sales.
Notably, GM's electric vehicle (EV) sales gains came even as the company declined to cut prices, unlike its rivals Ford and Tesla. "Our customers are saying we're priced well based on the demand that we're seeing," chief financial officer Paul Jacobson said.
All told, GM generated an adjusted operating profit of $3.8 billion. Its adjusted earnings per share, in turn, surged 57% to $2.12. That was well above analysts' projections, which had called for per-share profits of $1.69.
Now what
GM guided for net income of $8.7 billion to $10.1 billion in 2023. The automaker plans to cut costs by as much as $2 billion over the next two years, without laying off workers.
Additionally, GM announced that it purchased a $650 million stake in Lithium Americas (LAC). The two companies will work together to develop the Thacker Pass mine in Nevada. The mine is the biggest known source of lithium in the U.S.
Lithium is a key raw material for EV batteries. The project is expected to produce enough lithium for as many as 1 million EVs per year, with production beginning in 2026.
