One-time EV adjustments drag GM to net earnings loss for Q4 2025

General Motors reported a net loss in its fourth quarter 2025 earnings report as the automaker wrote off substantial costs from unused electric vehicle manufacturing equipment and China restructuring costs.

The Detroit automaker on Tuesday, Jan. 27, reported earnings for the period ending Dec. 31, 2025, and released its full-year guidance for 2026.

GM recorded a net loss of $3.31 billion in the final quarter of 2025. GM forewarned the substantial hit to its earnings in a government filing on Jan. 8 that said the company would be taking on $6 billion in costs for unused electric vehicle investment related to the production changes the automaker made last year. GM said in that same filing that it anticipated a $1.1 billion charge from restructuring its China business.

This is the second consecutive earnings impacted by electric vehicle production changes for GM. GM’s third quarter 2025 earnings plunged 57% compared with the same quarter a year earlier due to the first bout of adjustments.

Combined with the recent filing, GM will have accounted for a $7.6 billion loss on downshifting its EV production in 2025.

GM’s stock was trading up over 9% at $86.90 at 10:51 a.m. ET on Tuesday.

After enduring the fluctuating market conditions of 2025, GM said it expects a stronger 2026.

In a letter to shareholders, GM CEO Mary Barra said the company anticipates margins will return to a range of 8% to 10%.

“We expect the U.S. new vehicle market will continue to be resilient, and with our compelling vehicles, technology-driven services and operating discipline, 2026 should be an even better year for GM,” Barra wrote.

GM set its financial guidance of net income at a range of $10.3 billion to $11.7 billion and an adjusted net income range of $13 billion to $15 billion. GM’s 2026 financial guidance also includes anticipated capital spending of $10 billion to $12 billion that includes the company’s battery cell manufacturing joint ventures.

Barra added that the consistency of the company’s underlying profitability beneath the regulatory and political headwinds places it in a position to begin a new $6 billion share repurchase program and to increase its dividend rate by 20%.

As of Dec. 31, 2025, GM said it had 904 million shares outstanding, down from 995 million at the end of 2024, and 1.2 billion at the end of 2023.

“Looking ahead, we are operating in a U.S. regulatory and policy environment that is increasingly aligned with customer demand,” she said. “As a result, we continue to onshore more production to meet strong customer demand for our vehicles.”

Though the special items impact the company’s net income, its earnings before interest and taxes that most closely track operating performance remain unaffected ― which is good news for GM investors and factory workers.

Before adjusting for special items, GM reported a net income of $2.84 billion, a 13% increase over fourth quarter 2024. Net income for the year across the company was $12.75 billion, a 15% drop from the prior year.

Meanwhile, on an earnings call, GM CFO Paul Jacobson noted that tariffs cost the automaker $3.1 billion in 2025, below the company’s predicted range of $3.5 billion to $4.5 billion.

Due to GM’s tariff mitigation efforts ― accomplished through a three-pronged strategy of increasing U.S. vehicle and parts production, dropping $2 billion in business costs, and holding fast to vehicle pricing strategies ― Jacobson said the company was able to offset 40% of the tariff impact it may otherwise have experienced last year.

“When we provided updated guidance in October, we were tracking towards the low end of this range but took a conservative approach given the dynamic trade and tariff environment,” Jacobson said on the call Jan. 27. “We were able to do even better based on strong execution and favorable policy developments during the quarter, including the benefit from a lower tariff rate for Korea.”

Other impacts to earnings GM

Amid that restructuring, GM’s business in China improved significantly in the fourth quarter.

GM recorded a $513 million equity loss in China in the fourth quarter, better than the loss of $4.06 billion the automaker said it experienced a year earlier. GM posted an equity loss of $316 million in China across 2025 compared with a $4.41 billion loss in 2024.

Jacobson also noted that sourcing alternative semiconductor chips due to the disruptions with Chinese-owned computer chipmaker Nexperia. The resulting shortage cost GM $100 million in the fourth quarter 2025.

Jacobson added that GM expects another $100 million of “pressure” in the first quarter of this year though noted that GM experienced no production disruptions as a result of the chip shortage.

Dan Ives, managing director and senior equity analyst at Wedbush Securities, said in a report in response to GM’ earnings that he believes GM’s guidance for 2026 was relatively conservative as the company battles various costs that are beyond its control.

“While the tariff headlines and the EV restructuring activities remain a lingering headache to the bottom line, GM continues to navigate this difficult environment flawlessly to deliver strong bottom-line returns with significant cash flow generation over the coming years with greater focus on its ICE vehicle fleet to drive profitable growth,” Ives said.

Here are the fourth-quarter numbers GM reported:

• Net loss of $ 3.31 billion, a drop of 12% compared with the prior year’s quarter of a $2.96 billion net loss.
• Total revenues of $45.29 billion, down 5% compared with $47.7 billion in fourth quarter 2024.
• Sales fell 6.9% in the fourth quarter to 703,001 vehicles compared with the same quarter in 2024.
• Earnings before income and taxes (EBIT) of $2.84 billion, up 13% from $2.51 billion in the same quarter the prior year.

And full year 2025:

• Net income of $2.7 billion, less than half of the $6 billion it earned in 2024.
• Total revenues of $185 billion, a 1.3% dip compared with the prior year.
• Sales rose 5.5% in 2025 to 2,853,299 vehicles.
• Earnings before income and taxes (EBIT) of $12.7 billion, a 15% decline compared with $14.93 billion in 2024.

GM is the first of the Detroit Three to report earnings for the fourth quarter and full year of 2025.

Ford Motor Co. is expected to report earnings on Feb. 10 and Stellantis is scheduled to do the same on Feb. 26.

Glossary of Terms:

Earnings before interest and taxes: The metric that companies prefer to use because it doesn’t account for losses incurred in the quarter; therefore it tends to be higher and shows the company in a more favorable light.

Net income: The amount of money a company has left over after paying all expenses related to operating their business.

Net loss: The amount of money a company owes when its expenses exceed income for the quarter or year.

Revenue: How much money a company generated during the designated time before expenses like operating costs or taxes.

Stock value: The value that one share of stock in the company is worth at the end of market close on a particular day.

(This story has been updated to include new information.)

Jackie Charniga covers General Motors for the Free Press. Reach her at [email protected].

This article originally appeared on Detroit Free Press: One-time EV adjustments drag GM to net earnings loss for Q4 2025

Reporting by Jackie Charniga, Detroit Free Press / Detroit Free Press

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