Automotive manufacturer General Motors (NYSE: GM) missed Wall Street’s revenue expectations in Q4 CY2025, with sales falling 5.1% year on year to $45.29 billion. Its non-GAAP profit of $2.51 per share was 11.1% above analysts’ consensus estimates.

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"For several years now, GM's strong brands and winning vehicles, as well as our technology-driven services and operating discipline, have delivered consistently strong cash generation. This has allowed us to execute all phases of our capital allocation strategy, from investing in the business and our people, to maintaining a strong balance sheet and returning capital to shareholders," said Mary Barra, Chair and CEO.

Company Overview

Founded in 1908 by William C. Durant, General Motors (NYSE: GM) offers a range of vehicles and automobiles through brands such as Chevrolet, Buick, GMC, and Cadillac.

Revenue Growth

Examining a company’s long-term performance can provide clues about its quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. Luckily, General Motors’s sales grew at a decent 8.6% compounded annual growth rate over the last five years. Its growth was slightly above the average industrials company and shows its offerings resonate with customers.

We at StockStory place the most emphasis on long-term growth, but within industrials, a half-decade historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. General Motors’s recent performance shows its demand has slowed as its annualized revenue growth of 3.8% over the last two years was below its five-year trend. We also note many other Automobile Manufacturing businesses have faced declining sales because of cyclical headwinds. While General Motors grew slower than we’d like, it did do better than its peers.

This quarter, General Motors missed Wall Street’s estimates and reported a rather uninspiring 5.1% year-on-year revenue decline, generating $45.29 billion of revenue.

Looking ahead, sell-side analysts expect revenue to grow 1.5% over the next 12 months, a slight deceleration versus the last two years. This projection is underwhelming and implies its products and services will face some demand challenges.

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Operating Margin

General Motors was profitable over the last five years but held back by its large cost base. Its average operating margin of 6.2% was weak for an industrials business. This result isn’t too surprising given its low gross margin as a starting point.

Analyzing the trend in its profitability, General Motors’s operating margin decreased by 2.3 percentage points over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability. We’ve noticed many Automobile Manufacturing companies also saw their margins fall (along with revenue, as mentioned above) because the cycle turned in the wrong direction, but General Motors’s performance was poor no matter how you look at it. It shows that costs were rising and it couldn’t pass them onto its customers.

In Q4, General Motors generated an operating margin profit margin of 6.3%, up 3.1 percentage points year on year. The increase was a welcome development, especially since its revenue fell, showing it was more efficient because it scaled down its expenses.

Earnings Per Share

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.

General Motors’s EPS grew at a spectacular 16.8% compounded annual growth rate over the last five years, higher than its 8.6% annualized revenue growth. However, this alone doesn’t tell us much about its business quality because its operating margin didn’t improve.

Diving into General Motors’s quality of earnings can give us a better understanding of its performance. A five-year view shows that General Motors has repurchased its stock, shrinking its share count by 36.3%. This tells us its EPS outperformed its revenue not because of increased operational efficiency but financial engineering, as buybacks boost per share earnings.

Like with revenue, we analyze EPS over a shorter period to see if we are missing a change in the business.

For General Motors, its two-year annual EPS growth of 17.9% was higher than its five-year trend. We love it when earnings growth accelerates, especially when it accelerates off an already high base.

In Q4, General Motors reported adjusted EPS of $2.51, up from $1.92 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects General Motors’s full-year EPS of $10.62 to grow 14.9%.

Key Takeaways from General Motors’s Q4 Results

It was good to see General Motors provide full-year EPS guidance that slightly beat analysts’ expectations. We were also glad its EPS outperformed Wall Street’s estimates. On the other hand, its revenue slightly missed. Overall, this print had some key positives. The stock traded up 4.9% to $83.30 immediately after reporting.

So do we think General Motors is an attractive buy at the current price? If you’re making that decision, you should consider the bigger picture of valuation, business qualities, as well as the latest earnings. We cover that in our actionable full research report which you can read here (it’s free).