Why Should General Motors Stock Holders Watch This Number?
General Motors (GM) posted a 5.5% decline in U.S. new vehicle sales for the third quarter of 2026. This metric matters to investors because North America generated $3.4 billion of the automaker’s $3.9 billion adjusted operating profit in the second quarter. The company had also raised its 2026 profit forecast in July, before this latest sales figure was released. But why did GM’s U.S. sales fall?
GM Dropped Models And Sold Fewer Electric Vehicles
The decline in sales is partly the result of the automaker’s own decisions. News reports on October 1, 2026, pointed to discontinued models and a diminished market for electric vehicles, and GM recorded lower EV sales across the board. A separate report noted that high gasoline prices were weighing on demand for new vehicles.
Executives had previously outlined two of these factors. During an earnings call on July 21, 2026, management stated that the company’s market share was lower than in the first half of 2025. They explained that the drop largely reflected decisions to discontinue certain vehicles, a smaller EV market, and tight dealer inventory early in the year.
It is important to remember what this metric measures. U.S. sales track unit volume rather than revenue, meaning the automaker can sell fewer vehicles and still generate more money if each one sells for a higher price.
How Does GM’s Revenue Compare With Its Own Past?
The company is facing a mild downturn in its revenue. Revenue over the past twelve months reached $185.5 billion, down 1.1% from a year earlier. In the twelve months prior to that, revenue grew 5.3%.
This shift is equally visible in annual results. Revenue fell 1.3% in the most recent fiscal year, following growth of more than 9% in each of the two preceding years. While a single down year does not establish a trend, it marks a clear departure from recent performance.
Executives anticipate a soft conclusion to 2026. On the July call, management warned that the fourth quarter would be somewhat weaker than usual, primarily because the automaker is launching new full-size trucks. That product rollout will cost about 35,000 units of volume compared with a year earlier. Management also expects less help from pricing in the second half.
Are You Paying For A Recovery In GM Stock?
The market appears to be pricing in a turnaround. GM stock returned 40% over the past twelve months, against 17.1% for the S&P 500. Shares now trade at 37.2 times earnings, well above the 21.5 multiple for the broader index. Those earnings are unusually thin, featuring a net margin of 1.1% over the past twelve months against GM’s three-year average of 3.7%. As a result, the current valuation likely assumes that profit recovers.
Investors have a reason to expect such an improvement. The company has recorded $10.9 billion of EV-related charges since the second half of 2025, and management believes the material cash charges are substantially complete.
The strength of the truck portfolio offers a reason to worry less about the sales decline. GM held more than 42% of the U.S. full-size pickup market in the first half of 2026. With the redesigned Chevrolet Silverado and GMC Sierra arriving in showrooms in December, management believes the company can grow revenue in 2027.
A single quarter of falling U.S. sales warrants attention rather than alarm, given that revenue slipped only slightly and the automaker maintains its lead in full-size pickups. The company issued its adjusted operating profit forecast of $14 billion to $16 billion for 2026 in July, prior to the recent sales data. If executives maintain that range during the next update, it would signal that profit is holding steady despite the drop in U.S. sales. GM would normally update that range on its own quarterly earnings call. Separately, its finance subsidiary GM Financial reports third-quarter results on October 20, 2026.
How To Act On GM?
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