Revenue and Profitability: Steady Performance Despite Tariff Pressure

General Motors closed Q2 2025 with $47.1 billion in revenue and $3.0 billion in EBIT-adjusted. The EBIT-adjusted margin stood at 6.4%, while adjusted earnings per share reached $2.53. Despite a year-over-year decline in profitability, largely due to $1.1 billion in tariff impacts, the company maintained a resilient financial performance by relying on strong product mix, steady demand, and disciplined pricing.

Cash Flow and Capital Deployment: Financial Flexibility in Action

GM generated $2.8 billion in adjusted automotive free cash flow during the quarter, down from $5.3 billion in Q2 2024. The decrease was mainly driven by tariff payments, lower dealer inventory, and working capital pressures. The company completed a $2 billion accelerated share repurchase (ASR), retiring about 10 million shares during the quarter. It also issued $2 billion in new debt to support long-term investments, including a capital injection into Ultium Cells, its EV battery joint venture.

North American Operations: Market Leadership Maintained

In North America, GM delivered 878,000 vehicles and reached a 17.4% U.S. market share, a 0.7 percentage point improvement year-over-year. The company maintained leadership in full-size pickups with a 40% share and full-size SUVs with a dominant 60%. Retail sales rose by 10%, and crossover sales increased 16%, underscoring strong consumer demand and a successful vehicle lineup.

EV Momentum: Accelerated Growth and Share Gains

GM’s EV sales surged 111% year-over-year in Q2, reaching 16% of the U.S. EV market. Chevrolet secured the second-highest EV brand ranking in the U.S., while Cadillac became the #1 luxury EV brand. Models such as the Equinox EV, Blazer EV, and Hummer EV contributed to this growth. The company continues to invest in next-gen battery chemistry through its partnership with LG, including LFP and LMR technologies expected to begin production in 2027.

China Market: Continued Recovery and Profitability

GM recorded its second consecutive quarter of year-over-year growth in China, with a 20% increase in Q2 sales. Notably, approximately 50% of deliveries in the region were NEVs (New Energy Vehicles). Its joint venture in China continued to generate positive equity income and is expected to remain profitable through year-end.

Cost Environment and Operating Challenges

The $1.4 billion drop in EBIT-adjusted versus last year was primarily driven by the $1.1 billion tariff impact, $600 million in EV inventory adjustments, and $300 million in elevated warranty expenses. Nonetheless, GM managed to keep vehicle prices stable, reflecting sustained demand and disciplined go-to-market strategy.

Investment in Capacity and Future Technologies

GM announced $4 billion in new investments in U.S. manufacturing plants, as part of a multi-year capital plan totaling $10–12 billion. These projects will expand capacity for profitable vehicles including trucks, SUVs, and EVs. The company also initiated production of more efficient V8 engines, designed to reduce fuel consumption by 4–6%.

Dividend Policy and Shareholder Returns

In Q2 2025, GM paid a quarterly dividend of $0.15 per share—up 25% from earlier in the year—amounting to an annualized payout of $0.60 per share. The dividend yield stands at approximately 1.1%, with a payout ratio of just 7%, leaving ample room for continued investment. Alongside dividends, GM completed the $2 billion ASR, reinforcing its commitment to return capital while maintaining strategic flexibility.

What Sets GM Apart: Tech Integration at Scale

One of GM’s most defining characteristics is its integration of advanced software into its traditional manufacturing scale. Its Super Cruise hands-free driving system now operates in over 500,000 vehicles, with more than 200,000 monthly active users as of Q2. The company reported $4 billion in deferred software revenue from services like OnStar and vehicle connectivity features, positioning it as an industry leader in monetizing vehicle software—an area most automakers are still developing.

Outlook for the Remainder of 2025

GM reaffirmed its full-year guidance for 2025. The company expects EBIT-adjusted between $10.0 and $12.5 billion, adjusted EPS of $8.25 to $10.00, and adjusted automotive free cash flow between $7.5 and $10.0 billion. While tariff impacts are anticipated to increase in the second half of the year, GM aims to offset at least 30% of these costs through manufacturing adjustments, cost reduction initiatives, and modest price increases in North America. The company maintains operational agility and strong financial fundamentals heading into the latter half of the year.

Conclusion

Q2 2025 highlights GM’s ability to balance strong financial performance with strategic long-term positioning. The company continues to lead in key vehicle segments, grow its EV presence, invest in core and emerging technologies, and return capital to shareholders. Its blend of industrial strength and digital innovation places it at the forefront of a rapidly evolving automotive landscape.