General Motors Corp. on Wednesday reported a 49 percent jump in second-quarter profit, boosted by income from car loans and automotive gains in North America and Asia.
The world’s largest automaker said it had net income of $1.34 billion, or $2.36 a share, easily surpassing estimates of $2.24 a share. Sales rose 7 percent, to $49.1 billion. A year ago, GM earned $901 million, or $1.58 a share.
GM benefited from a record quarter by the company’s finance businesses, which accounted for about two-thirds of its profit. The General Motors Acceptance Corp. unit earned $860 million, up from $834 million.
Automotive earnings rose almost fourfold, helped by lower costs in North America and rising market share in China. Its loss in Europe widened.
But GM’s share of the light-vehicle market in the U.S. dropped 1.1 percentage points, to 26.7 percent, during the quarter, according to Autodata Corp.
“North America is the tag that wags the dog, and demand has been really tough this year,” said Sasha Kamper of Principal Global Investors. “North America will ultimately drive earnings and the stock price.”
Shares of GM declined by 29 cents Wednesday to $43.31.
In other earnings news:
– American Airlines parent AMR Corp. posted second-quarter net income of $6 million, or 3 cents a share, compared with a net loss of $75 million, or 47 cents a share, in the year-ago period. Revenue climbed 12 percent, to $4.83 billion.
Excluding a $31 million boost to profit after the company overestimated costs to close facilities and ground planes, Ft. Worth-based AMR would have lost 15 cents a share.
On that basis, it had been expected to lose 10 cents a share, according to Thomson First Call.
Passenger traffic rose 10 percent as international travel climbed from a year ago, when the Iraq war and the SARS virus hurt demand. But fuel costs, AMR’s second-largest expense after labor, surged 42 percent, to $917 million.
“While the spike in fuel prices masked a lot of our progress in the second quarter, the fact is we were able to absorb what a year ago would have been a crippling blow,” said Chief Executive Gerard Arpey.
AMR stock fell 45 cents, or almost 5 percent, to $8.92 on the New York Stock Exchange.
– Pfizer Inc., the world’s largest drugmaker, reported a second-quarter profit of $2.86 billion, or 38 cents a share, compared with a net loss of $3.59 billion, or 48 cents a share, a year earlier, when costs from the purchase of Pharmacia Corp. hurt results.
Excluding expenses related to that purchase and certain other costs, the New York-based company would have earned 47 cents a share in the most recent quarter, matching estimates. Revenue jumped 24 percent, to $12.3 billion.
Shares of Pfizer slipped 20 cents to $32.13 on the NYSE.
– Northwest Airlines Corp. reported a second-quarter loss of $182 million, or $2.11 a share, compared with a profit of $227 million, or $2.45 a share, a year ago, when results were boosted by government reimbursement of security fees and the sale of a ticket processing company.
Excluding a one-time charge, the Minneapolis-based carrier would have lost 90 cents a share, much smaller than the loss of $1.21 a share estimated by analysts. Revenue increased 18 percent, to $2.87 billion.
Northwest stock fell 43 cents, or almost 5 percent, to $8.51 on the Nasdaq stock market.
– Sprint Corp., which combined its PCS and FON tracking stocks in April, said it earned $233 million, or 16 cents a share, in the second quarter. A year ago, the Overland Park, Kan.-based company earned $7 million, or break even on a per-share basis.
Excluding one-time charges, Sprint would have earned 20 cents a share, 1 cent a share more than estimates. Revenue increased to $6.9 billion from $6.5 billion.
Shares of Sprint rose 41 cents, more than 2 percent, to $18.43 on the NYSE.
