Wall Street reacted negatively to General Motors' Q2 earnings report, highlighting struggles with EV profitability amid comments from analysts comparing it unfavorably to Tesla. A significant profit decline of one-sixth was noted, mainly due to tariff impacts. Analysts from Morgan Stanley and Piper Sandler stressed the necessity for a groundbreaking strategy rather than mere operational adjustments. They warned that without a transformative approach, GM could face bleak projections, estimating adjusted earnings per share could settle closer to $8.25 instead of their higher forecast of $10.
Shares of GM fell 8% following a second-quarter adjusted net profit decrease, largely due to a $1.1 billion impact from tariffs imposed by the Trump administration.
Piper Sandler emphasized that General Motors needs a bold, transformative strategy, such as exploring humanoid robots, if it hopes to regenerate investor interest and change its current trajectory.
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