Analysis of Profitability Ratios
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
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- Balance Sheet: Assets
- Analysis of Solvency Ratios
- Analysis of Short-term (Operating) Activity Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Analysis of Reportable Segments
- Analysis of Geographic Areas
- Enterprise Value (EV)
- Enterprise Value to EBITDA (EV/EBITDA)
- Dividend Discount Model (DDM)
- Net Profit Margin since 2010
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Profitability Ratios (Summary)
General Motors Co., profitability ratios
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Gross Profit Margin
- The gross profit margin exhibited an overall positive trend across the periods analyzed. Starting at 10.25% in 2020, it increased to a peak of 11.87% in 2022, followed by a slight dip to 10.36% in 2023, and then rebounded to 11.97% in 2024. This indicates a generally improving efficiency in production or cost management before a minor setback and recovery.
- Operating Profit Margin
- The operating profit margin showed notable fluctuations. An increase from 6.10% in 2020 to 8.21% in 2021 was observed, suggesting stronger operating performance. This was then followed by a decline to 7.16% in 2022 and further down to 5.90% in 2023, indicating rising operating costs or reduced operating income. The margin slightly recovered to 7.45% in 2024, though it did not reach the 2021 level.
- Net Profit Margin
- Net profit margin trends were less stable, with an initial increase from 5.91% in 2020 to 8.82% in 2021, reflecting improved bottom-line profitability. However, the margin decreased significantly to 6.90% in 2022, then declined further to 6.42% in 2023, and dropped sharply to 3.50% in 2024. This downward trend in recent years suggests increased expenses, lower income, or other factors negatively impacting net earnings.
- Return on Equity (ROE)
- The return on equity followed a similar pattern to profitability margins. Starting at 14.27% in 2020, it rose to 16.77% in 2021, indicating enhanced efficiency in generating profits from shareholders’ equity. It then declined to 14.65% in 2022 but partially recovered to 15.75% in 2023. In 2024, there was a significant drop to 9.53%, suggesting a considerable decrease in equity returns possibly connected to lower net profitability or increased equity base.
- Return on Assets (ROA)
- Return on assets showed improvement early on, increasing from 2.73% in 2020 to 4.09% in 2021, reflecting better asset utilization. After peaking in 2021, ROA gradually declined to 3.76% in 2022 and 3.71% in 2023, followed by a substantial fall to 2.15% in 2024. This decline indicates reduced efficiency in generating earnings from total assets in the most recent period.
Return on Sales
Return on Investment
Gross Profit Margin
General Motors Co., gross profit margin calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Automotive and other gross margin | ||||||
| Automotive net sales and revenue | ||||||
| Profitability Ratio | ||||||
| Gross profit margin1 | ||||||
| Benchmarks | ||||||
| Gross Profit Margin, Competitors2 | ||||||
| Ford Motor Co. | ||||||
| Tesla Inc. | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Gross profit margin = 100 × Automotive and other gross margin ÷ Automotive net sales and revenue
= 100 × ÷ =
2 Click competitor name to see calculations.
The analyzed financial data over the five-year period reveals significant trends in both revenue generation and profitability metrics. The automotive segment experienced a consistent increase in net sales and revenue, growing from $108,673 million in 2020 to $171,606 million in 2024. This represents a substantial expansion in sales volume or pricing power, indicating robust market demand or successful pricing strategies during this period.
Alongside revenue growth, the automotive and other gross margin in absolute terms has shown a generally positive trend. It increased from $11,134 million in 2020 to $20,541 million in 2024, although it reached a peak in 2022 at $17,083 million before slightly declining in 2023 and then rising sharply again in 2024. This pattern suggests some fluctuations in cost management or product mix that affected gross margin generation before a recovery in the latest year.
The gross profit margin percentage provides insight into profitability relative to sales. This margin improved from 10.25% in 2020 to 11.97% in 2024. There was an upward trend from 2020 through 2022, peaking at 11.87%, followed by a decrease in 2023 to 10.36% before increasing again in 2024. The dip in 2023 indicates a possible surge in costs or pricing pressures that were not fully passed onto customers, temporarily compressing margins.
- Summary of Key Financial Trends:
- - Strong growth in automotive net sales and revenue over the five years, nearly a 58% increase from 2020 to 2024.
- - Fluctuations in gross margin in absolute terms, with a notable dip in 2023 followed by a recovery in 2024.
- - Gross profit margin percentage generally improved over the period, reflecting enhanced cost efficiency or pricing, except for a decline in 2023 that suggests mid-term margin pressure.
- - The overall pattern indicates resilience and growth capacity despite some volatility in profitability ratios during the five-year span.
Operating Profit Margin
General Motors Co., operating profit margin calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Operating income | ||||||
| Automotive net sales and revenue | ||||||
| Profitability Ratio | ||||||
| Operating profit margin1 | ||||||
| Benchmarks | ||||||
| Operating Profit Margin, Competitors2 | ||||||
| Ford Motor Co. | ||||||
| Tesla Inc. | ||||||
| Operating Profit Margin, Sector | ||||||
| Automobiles & Components | ||||||
| Operating Profit Margin, Industry | ||||||
| Consumer Discretionary | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Operating profit margin = 100 × Operating income ÷ Automotive net sales and revenue
= 100 × ÷ =
2 Click competitor name to see calculations.
- Operating Income
- The operating income exhibited a generally positive trend over the observed period. Starting at 6,634 million US dollars in 2020, it increased significantly to 9,324 million in 2021. This upward momentum continued into 2022, reaching 10,315 million. However, a slight decline occurred in 2023, with operating income falling to 9,298 million, before recovering to a peak of 12,784 million in 2024. This suggests resilience and improved profitability in the latest year after a minor setback.
- Automotive Net Sales and Revenue
- There was a consistent and substantial growth in automotive net sales and revenue throughout the period. Beginning at 108,673 million US dollars in 2020, the revenue rose steadily each year: 113,590 million in 2021, 143,975 million in 2022, and 157,658 million in 2023. The trend culminated in 171,606 million in 2024, indicating strong and persistent expansion in the company’s core sales activities.
- Operating Profit Margin
- The operating profit margin showed some volatility across the years. It started at 6.1% in 2020 and increased notably to 8.21% in 2021. The margin then decreased to 7.16% in 2022 and further declined to 5.9% in 2023, reflecting decreasing efficiency or increasing costs relative to revenue during that time. In 2024, the margin improved again to 7.45%, suggesting a recovery in profitability relative to sales, though it remained below the peak seen in 2021.
- Overall Analysis
- The company displayed impressive growth in automotive net sales and revenue over the five-year period, demonstrating an ability to increase market presence or sales volume consistently. Operating income mostly followed the revenue’s positive trajectory, with a minor dip in 2023 before reaching the highest value in 2024, indicating improved operational performance. The operating profit margin's fluctuations suggest variability in cost management or pricing strategies, with a notable peak in 2021 and a recovery phase in 2024. The data reflect a company experiencing robust sales growth with some challenges in maintaining consistent profitability margins year-over-year, yet showing an overall positive outlook in recent periods.
Net Profit Margin
General Motors Co., net profit margin calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income attributable to stockholders | ||||||
| Automotive net sales and revenue | ||||||
| Profitability Ratio | ||||||
| Net profit margin1 | ||||||
| Benchmarks | ||||||
| Net Profit Margin, Competitors2 | ||||||
| Ford Motor Co. | ||||||
| Tesla Inc. | ||||||
| Net Profit Margin, Sector | ||||||
| Automobiles & Components | ||||||
| Net Profit Margin, Industry | ||||||
| Consumer Discretionary | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Net profit margin = 100 × Net income attributable to stockholders ÷ Automotive net sales and revenue
= 100 × ÷ =
2 Click competitor name to see calculations.
- Net income attributable to stockholders
- The net income demonstrates an overall upward trend from 2020 to 2023, rising from $6,427 million to $10,127 million. However, there is a substantial decline in 2024, with net income decreasing to $6,008 million. This suggests a significant reduction in profitability in the most recent period.
- Automotive net sales and revenue
- The automotive net sales and revenue have shown consistent growth throughout the entire period under review. The figures increased steadily from $108,673 million in 2020 to $171,606 million in 2024, indicating strong revenue expansion and possibly increased market demand or sales volume.
- Net profit margin
- The net profit margin reveals a fluctuating but generally declining trend over the five years. It rose considerably from 5.91% in 2020 to 8.82% in 2021, but then decreased progressively thereafter, reaching 3.5% in 2024. This downward trend in margin, despite higher revenue, points to increasing costs, pricing pressures, or other factors adversely impacting profitability.
- Overall insights
- The data indicates that while revenue grew consistently, the company’s profitability did not sustain the same positive trajectory. The sharp drop in net income and decline in profit margin in the most recent year suggest challenges in cost management, operational efficiency, or external economic factors. These trends warrant further investigation to identify the underlying causes and to formulate strategic responses.
Return on Equity (ROE)
General Motors Co., ROE calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income attributable to stockholders | ||||||
| Stockholders’ equity | ||||||
| Profitability Ratio | ||||||
| ROE1 | ||||||
| Benchmarks | ||||||
| ROE, Competitors2 | ||||||
| Ford Motor Co. | ||||||
| Tesla Inc. | ||||||
| ROE, Sector | ||||||
| Automobiles & Components | ||||||
| ROE, Industry | ||||||
| Consumer Discretionary | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
ROE = 100 × Net income attributable to stockholders ÷ Stockholders’ equity
= 100 × ÷ =
2 Click competitor name to see calculations.
The analysis of the annual financial data reveals significant trends in profitability and equity metrics over the five-year period.
- Net Income Attributable to Stockholders
- Net income demonstrated a strong upward trajectory from 6,427 million USD in 2020 to a peak of 10,127 million USD in 2023. However, in 2024, there was a notable decline to 6,008 million USD, representing a significant reduction compared to the prior two years. This indicates volatility in earnings performance, with earnings peaking in 2023 before contracting sharply.
- Stockholders’ Equity
- Stockholders’ equity consistently increased from 45,030 million USD in 2020 to 67,792 million USD in 2022, indicating robust growth in the company's net assets. However, equity declined in the following years, falling to 64,286 million USD in 2023 and further to 63,072 million USD in 2024. This downward trend after 2022 suggests possible shareholder distributions, losses, or other factors reducing equity.
- Return on Equity (ROE)
- ROE followed a somewhat similar pattern to net income, rising from 14.27% in 2020 to a high of 16.77% in 2021, before settling around 14.65% in 2022 and 15.75% in 2023. In 2024, ROE experienced a sharp decline to 9.53%. This drop aligns with decreased net income and equity, indicating diminished efficiency in generating profits from shareholders’ investments during the most recent period.
Overall, the data reflects a period of earnings and equity growth up to 2022-2023, followed by a notable contraction in 2024 across profitability and equity measures. This suggests emerging challenges or changes in operational performance that have impacted financial outcomes in the latest year observed.
Return on Assets (ROA)
General Motors Co., ROA calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income attributable to stockholders | ||||||
| Total assets | ||||||
| Profitability Ratio | ||||||
| ROA1 | ||||||
| Benchmarks | ||||||
| ROA, Competitors2 | ||||||
| Ford Motor Co. | ||||||
| Tesla Inc. | ||||||
| ROA, Sector | ||||||
| Automobiles & Components | ||||||
| ROA, Industry | ||||||
| Consumer Discretionary | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
ROA = 100 × Net income attributable to stockholders ÷ Total assets
= 100 × ÷ =
2 Click competitor name to see calculations.
The financial data reveals several notable trends over the five-year period under review. The net income attributable to stockholders displays significant fluctuations. Starting at 6,427 million US dollars in 2020, there is a marked increase to a peak of 10,019 million in 2021. This is followed by a slight decline to 9,934 million in 2022, a modest recovery to 10,127 million in 2023, and finally a substantial decrease to 6,008 million in 2024. This suggests variability in profitability, with the most recent year showing a notable downturn compared to the prior three years.
Total assets exhibit a consistent upward trajectory throughout the period. Beginning at 235,194 million US dollars in 2020, the assets grow steadily each year, reaching 279,761 million by 2024. The increase is gradual but persistent, indicating ongoing asset accumulation or investment activities.
The Return on Assets (ROA) percentage follows a pattern that correlates with the fluctuations in net income, albeit with a more pronounced decline in the last year. ROA rises from 2.73% in 2020 to a high of 4.09% in 2021, somewhat decreases to 3.76% and 3.71% in 2022 and 2023 respectively, then sharply drops to 2.15% in 2024. This decrease signals reduced efficiency in generating profit from assets in the latest period, despite the continued growth in total assets.
- Summary of Key Insights
- - Profitability peaked in 2021 and remained relatively strong through 2023, but experienced a significant decline in 2024.
- - Asset base expanded consistently every year, reflecting growth or increased investments.
- - The return on assets improved alongside rising profits initially, but the steep drop in 2024 suggests a possible challenge in leveraging assets effectively to generate income.
- - The divergence between rising assets and falling profitability in the latest year warrants further examination to identify underlying causes.