GM Pulls Guidance And Pauses Buybacks Amidst “Tariff Uncertainty”

GM stock dipped slightly Tuesday morning after the company pulled its annual profit forecast, citing significant uncertainty created by President Trump’s evolving trade policies, according to Bloomberg, WSJ and multiple other outlets. 

Despite reporting strong first-quarter results, the Detroit automaker warned investors not to rely on previous guidance due to the potentially “significant” impact of automotive tariffs.

“We’re telling folks not to rely on the prior guidance, and we’ll update when we have more information around tariffs,” GM Chief Financial Officer Paul Jacobson said during a media call. “Given the evolving nature of the situation, we believe the future impact of tariffs could be significant.”

The company’s decision comes as the White House reportedly moves to soften the impact of auto tariffs, preventing them from stacking atop existing duties like those on steel and aluminum. According to The Wall Street Journal, the administration will allow automakers to be reimbursed for overlapping tariffs, a change expected to be retroactive and officially announced before Trump’s rally in Michigan Tuesday evening.

Commerce Secretary Howard Lutnick confirmed a deal had been struck, though details remained scarce. The adjustments could offer temporary relief to domestic automakers, including GM, which assemble cars in the U.S. but rely on imported parts.

Nevertheless, GM’s leadership is urging caution. “We’re going to look for more clarity before we get into any forward projections of the tariff exposure,” Jacobson said.

In January, GM had forecast net income between $11.2 billion and $12.5 billion for 2025, excluding tariff impacts. It also projected adjusted pretax profit between $13.7 billion and $15.7 billion. That forecast is now shelved.

First-quarter results showed cracks forming. GM’s net income fell 6.6% to $2.8 billion, dragged down by weaker sales of highly profitable trucks and SUVs, along with rising warranty and labor costs. Adjusted earnings before interest and taxes (EBIT) slipped 9.8% to $3.49 billion, with EBIT-adjusted margins falling from 9% a year ago to 7.9%.

Revenue, however, rose 2.3% to $44 billion, surpassing analysts’ estimates of $43 billion. Adjusted earnings per share came in at $2.78, also ahead of expectations. GM credited a last-minute surge in car buying in March, as consumers sought to beat potential price hikes from new tariffs that began earlier this month.

While the results slightly exceeded Wall Street’s cautious predictions, they revealed growing challenges for a company that has ridden high profits in recent years. Jacobson pointed to an “unusually strong” first quarter in 2024 following the resolution of a United Auto Workers strike, suggesting 2025’s first quarter suffered by comparison.

Earlier this month, GM reported U.S. sales jumped 17% year-over-year to 693,363 units, led by strength in trucks and EVs across its Chevrolet, Cadillac, Buick, and GMC brands. Full-size pickups, particularly the Chevrolet Silverado and GMC Sierra, delivered their best first-quarter sales since 2007.

Nonetheless, GM is bracing for a turbulent year ahead. The company delayed its analysts’ call until Thursday, an unusual step reflecting the fast-changing policy environment.

Chair and CEO Mary Barra, in a statement, said, “We appreciate the productive conversations with the President and his Administration and look forward to continuing to work together.”

In the meantime, GM announced it would pause new share buybacks beyond the $2 billion plan slated for completion in the second quarter, pending greater economic clarity. It stressed there was no current need to raise additional capital.