GM (GM) reported second quarter results before the bell on Tuesday that topped expectations, with the Big Three stalwart continuing to grow profits despite fewer sales.

GM reported Q2 revenue of $48.03 vs. $46.61 billion, per Bloomberg consensus, up 1.9% from the $47.1 billion the automaker posted a year ago. GM posted adjusted earnings per share (EPS) of $3.57 vs. $3.19 estimated, and adjusted EBIT of $3.94 billion compared to $3.7 billion expected.

For comparison, GM's adjusted EBIT in Q2 last year came in at $3 billion — a figure heavily weighed down by tariff costs that are now easing, as tariff offsets take hold.

And for a second time this year, GM raised its guidance. For the full year, now GM expects:

Adjusted EBIT of $14.0 billion-$16.0 billion (prior $13.5 billion-$15.5 billion)

Adjusted EPS of $12.00-$14.00 (prior $11.50-$13.50)

Adjusted automotive free cash flow of $9.5 billion-$11.5 billion (prior $9 billion-$11 billion)

More from Yahoo Scout How are tariffs and supply chain changes affecting GM? What drove GM's better-than-expected Q2 financial performance? Why did GM raise its full-year guidance twice? What's behind GM's declining vehicle sales despite strong profits?

GM said its updated guidance made key assumptions, including pricing up around 0.5%, EV losses improving by $1.0 billion to 1.5 billion, regulatory benefits of $500 million to $700 million, gross tariff costs of $2.5 billion to $3.5 billion, and commodity inflation (including DRAM) of $1.5 billion to $2.0 billion, among others.

"Customer demand in North America remains strong driven by our very attractive lineup of pickups and SUVs," CEO Mary Barra added in her letter to shareholders. "Our 8.6% EBIT-adjusted margin in North America was up 2.5 points from a year ago, and we continue to lower our warranty costs, reduce EV losses, and increase operating efficiency. "

GM said incentives as a percentage of MSRP averaged 4.7% in Q2, below the industry average of 6.3%, with dealer inventory down 3% year over year, in the company's targeted range of 50 to 60 days.

In addition to government offsets that are reducing its tariff bill, GM has spent the past year reworking its supply chain, shifting production, and negotiating with suppliers to blunt the tariff hit.

But while tariffs easing will help its bottom line, its vehicle sales have been slipping.

GM sold approximately 715,000 vehicles in the US in the second quarter, a 4.2% decline from a year ago, though it held its position as the country's top-selling automaker.

The GMC Sierra is displayed at the 2026 Canadian International AutoShow in Toronto, Ontario, on Feb. 12, 2026. (Arrush Chopra/NurPhoto via Getty Images) · NurPhoto via Getty Images

The company said much of the drop was due to discontinued models like the Cadillac XT4 and XT6 and the Chevrolet Malibu, as well as a sharp electric vehicle pullback following the expiration of the federal EV tax credit, which pulled demand forward into late 2025.