DETROIT — General Motors said its net income more than doubled to a record $2.77 billion in the third quarter. The company narrowed its quarterly loss in Europe but warned that achieving its target to break even in Europe this year would be "very challenging" after the UK's vote to quit the EU.
GM generated record revenue of $42.8 billion, up 10 percent from a year ago.
"Our record third quarter, led by strong performance in the U.S. and China, reflects our determination to deliver on our commitments," GM CEO Mary Barra said in a statement on Tuesday. "We will continue executing our plan to deliver earnings that enhance shareholder returns."
GM posted adjusted earnings before interest and taxes of $3.5 billion, a fifth consecutive quarterly record. It earned $3.5 billion in North America, 5.9 percent more than a year ago, while losses in Europe and South America canceled out income from other regions and divisions. Strong sales in China pushed earnings in GM International Operations to $271 million for the quarter.
GM’s total net income, equal to $1.72 a share, was nearly 20 percent better than the estimates from Wall Street analysts.
Chief Financial Officer Chuck Stevens said the automaker was now unlikely to meet its goal of breaking even in Europe this year because of fallout from the UK’s June vote to leave the European Union.
Stevens said that a $142 million third-quarter loss in Europe -- narrowing from a loss of $231 million a year earlier -- included a $100 million hit from currency fluctuations related to the Brexit vote and that fourth-quarter earnings would be cut by $300 million.
"The pound sterling has deteriorated further, which creates another headwind for us. Breaking even this year is going to be very, very challenging," Stevens told reporters at GM’s headquarters. "We're going to take a look across the business and take whatever action is necessary to get the business back on track."
Stevens said GM raised vehicle prices in the UK by 2.5 percent on Oct. 1. GM sells cars badged as Vauxhalls in the UK.
GM’s North American margins declined to 11.2 percent from 11.8 percent a year ago. But revenue for the region rose 12 percent to $31.1 billion.
Stevens said GM expects to maintain margins of at least 10 percent in North America even as the U.S. market flattens out and competition intensifies. "We're entering the heart of our product launch cadence," he said.
GM’s third-quarter earnings were boosted by a $110 million recovery of costs related to its 2014 ignition-switch recalls.
The automaker said it now expects full-year earnings to be “at the high end” of its previous projections of $5.50 to $6 a share, or roughly $8.5 billion to $9.3 billion.
GM’s earnings in the first nine months of the year total $7.59 billion, 122 percent more than the same period of 2015.
Stevens said the automaker generated enough cash to complete a $5 billion share buyback one quarter sooner than planned.
Reuters and Bloomberg contributed to this report