GM Down Modestly Despite Earnings That Beat Expectations - TheStreet

GM Down Modestly Despite Earnings That Beat Expectations

The company's main automotive unit, GM North America, led the turnaround as the company recovered from a labor dispute.
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General Motors

(GM) - Get Report

reported third-quarter earnings today that exceeded Wall Street's expectations but failed to excite investors.

The auto maker said it earned $877 million, or $1.33 a diluted share, from continuing operations, providing a sharp contrast from the 1998 third quarter when strikes resulted in a net loss of $309 million, or 52 cents a share. A consensus of analysts polled by

First Cal/Thomson Financial

had projected the stock at $1.24.

But after rising modestly early on, GM's stock was trading down 1 1/4 at 63 7/8 at midday on the

New York Stock Exchange

.

GM's revenues for the third quarter rose 27.6%, to $42.8 billion, from $33.5 billion in the 1998 quarter.

The company's main automotive unit,

GM North America

, led the turnaround as the company recovered from its labor dispute. The unit posted an 81% increase in income for the third quarter. The company's financing unit,

GMAC

, saw its income rise more than 25%. But

GM Europe's

income slipped 36%.

"GM North America had by far its best third-quarter financial results of the decade," Chief Operating Officer Rick Wagoner said in a statement. "The improved availability of our popular new cars and trucks drove a 2 percentage-point improvement in U.S. market share from July to September."