GM Faces Third Quarter Earnings Test as Sales Decline

General Motors is preparing to report its third quarter 2026 financial results before the U.S. stock market opens Tuesday, Oct. 20, with investors focused on earnings growth, vehicle demand, and whether the Detroit automaker will increase its annual forecast amid rising costs and a challenging outlook for the U.S. automotive industry.

According to average estimates compiled by LSEG and reported by CNBC, analysts expect adjusted earnings of $3.63 per share and revenue of $48.70 billion. The earnings report is scheduled for release before the market opens, followed by an earnings conference call with analysts at 8:30 a.m. Eastern Time.

The projections indicate relatively stable revenue compared with the same quarter in 2025, alongside an increase of about 30% in adjusted earnings per share. GM reported $48.59 billion in revenue, $1.3 billion in net income attributable to stockholders, and adjusted earnings of $2.80 per share in the third quarter of 2025, according to CNBC.

Other research firms published somewhat lower estimates ahead of the announcement. Yahoo Finance cited projections of $3.61 in adjusted earnings per share and $48.67 billion in revenue, while Zacks Investment Research estimated earnings of $3.55 per share and revenue of $48.21 billion. Zacks said its quarterly earnings estimate had increased by 5 cents over the preceding seven days.

General Motors delivered 670,974 vehicles in the United States during the third quarter, a 5.5% decline from a year earlier, according to Zacks. Sales fell across Chevrolet, GMC, and Cadillac, while Buick deliveries increased 8%. Despite the overall decline, GM retained its position as the country's top-selling automaker.

For comparison, Ford's U.S. sales fell 6.6% year over year to 509,764 vehicles during the quarter, while Toyota's North American sales declined 0.6%, Zacks reported.

GM increased its 2026 financial guidance when it announced second quarter results. The company projected adjusted earnings before interest and taxes of $14 billion to $16 billion, adjusted earnings per share of $12 to $14, and adjusted automotive free cash flow of $9.5 billion to $11.5 billion.

Investors are assessing whether management will raise those targets again. Wall Street analysts remain divided, with concerns about slowing sales and higher commodity expenses weighing on expectations for further guidance increases.

Rajat Gupta, a JPMorgan analyst, outlined the investment bank's expectations in an Oct. 11 investor note.

"While we expect in-line to slightly better 3Q26 prints, investor focus is likely to be on 2027 revisions and we don't see results driving meaningful upside," said Rajat Gupta, a JPMorgan analyst.

The analyst's assessment highlights the importance of GM's outlook for 2027, when the U.S. automotive industry is expected to face a difficult operating environment. Investors are also monitoring whether quarterly results can materially change expectations for the company's future performance.

Costs remain a significant concern. According to Zacks, GM expects commodity and logistics inflation to add $1.2 billion to $1.7 billion in costs during 2026. Additional expenses are anticipated as the company shifts more production to the United States, including the planned transfer of Escalade production to the Orion Assembly plant, which is expected to have its largest impact in the fourth quarter.

GM's pricing strategy has helped protect profitability despite inflation and tariff-related expenses. Zacks reported that the automaker had kept customer incentives below the industry average for more than three years. Its estimates placed GM North America's operating income at $3.17 billion for the third quarter, representing an increase of 26% from the previous year.

Software and digital services are another area of investor interest. Zacks identified recurring revenue from OnStar subscriptions and the expansion of Super Cruise across additional models as potential contributors to the company's earnings. GM also expects recognized revenue and deferred revenue from its software operations to exceed $3 billion and approach $7.5 billion, respectively, in 2026.

Investors are also looking for updates on redesigned full-size pickup trucks, warranty improvements, and the profitability of GM's operations in China. Zacks attributed improvements in China to operational restructuring, a streamlined dealer network, cost reductions, and new product introductions.

GM's second quarter performance provides additional context for the upcoming report. Yahoo Finance reported that adjusted earnings per share reached $3.57, exceeding the analyst consensus of $3.18, while the North American operating margin expanded by 2.5 percentage points to 8.6%. Management raised its full-year adjusted earnings guidance for the second time following those results.

Full-year projections also vary among research providers. Yahoo Finance cited an average adjusted earnings estimate of $13.51 per share and revenue of $185.83 billion for 2026. Zacks estimated full-year earnings of $13.54 per share and revenue of $185.3 billion, reflecting its own consensus calculations.

Beyond the financial figures, the company's quarterly announcement will provide an opportunity for management to address vehicle launches, operating expenses, and the development of higher-margin services as General Motors prepares for the next financial year.