How GM (General Motors Company) Makes Money in 2025: A Deep-Dive With Income Statement

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Understanding how a legacy automaker like GM (formerly General Motors Company) makes money is essential for investors and anyone interested in the business of automotive manufacturing and mobility solutions. In this post, we break down GM's quarterly income statement (Q3 2025) using a Sankey chart to visualize the financial flows — what comes in, where it goes, and what's left as profit.

Quick GM Overview

GM operates as a global automotive manufacturer, designing, building, and selling cars, trucks, and automotive parts under brands such as Chevrolet, GMC, Cadillac, and Buick. Revenue comes primarily from vehicle sales, automotive parts, and financial services through GM Financial. The company also invests in emerging mobility solutions, including autonomous driving (Cruise) and electric vehicles, though these segments are not yet significant contributors to revenue.

Revenue Breakdown

• Total Revenue (Q3 2025): $45.0B (−7.6% YoY)
  • Other Revenue by Product: $40.7B (90.4% of total, −8.9% YoY)
  • GM Financial Revenue: $4.34B (9.6% of total, +7.6% YoY)
  • Cruise Revenue: $0.0B (0% of total)
  • Growth is powered by resilient financial services, while core automotive sales faced headwinds from softer demand and pricing pressures.

Gross Profit and Margins

• Gross Profit: $3.11B (6.9% gross margin)
  • Cost of Revenue: $41.9B (−1.0% YoY)
  • GM maintains moderate margins due to the capital-intensive nature of auto manufacturing, competitive pricing, and ongoing investments in electrification and technology.
• Most costs come from vehicle production, raw materials, labor, and logistics.

Operating Income and Expenses

• Operating Income: $1.08B (−70.5% YoY, 2.4% margin)
• Operating Expenses: $2.04B (−25.8% YoY)
  • R&D: Not separately disclosed for Q3 2025
  • SG&A: $2.04B (−25.8% YoY, 4.5% of revenue) — includes selling, general, and administrative costs related to global operations, marketing, and corporate functions
  • GM continues to control costs and streamline operations while investing in future mobility, despite a challenging market environment.

Net Income

• Pre-Tax Income: $1.42B (−61.8% YoY, 3.1% margin)
• Income Tax: $127M (8.9% effective tax rate)
• Net Income: $1.33B (−56.6% YoY, 2.9% net margin)
• GM converts a moderate portion of sales into profit due to scale, but faces margin pressure from high fixed costs and competitive pricing.

What Drives GM's Money Machine?

• Automotive sales: Over 90% of revenue comes from vehicle and parts sales, making this the core driver of GM's income.
• GM Financial: The captive finance arm generated $4.34B in revenue (+7.6% YoY), supporting vehicle sales and providing a stable profit stream.
• Strategic investments: GM invests heavily in electric vehicles, battery technology, and autonomous driving (Cruise), though these areas are not yet profitable.
• Future growth areas: Electric vehicles and autonomous mobility are key focus areas, but remain in investment phase with limited current revenue contribution.

Visualizing GM's Financial Flows

The Sankey chart below visualizes how each dollar flows from gross revenue, through costs and expenses, down to net income. This helps investors spot where value is created, what areas weigh on profits, and how efficiently the company operates.

• Most revenue flows into gross profit, with cost of revenue (vehicle production and materials) taking the largest chunk.
• Even after significant costs and investments, only 2.9% of revenue drops to the bottom line as net income.

Key Takeaways

• GM's money comes overwhelmingly from automotive sales and related products
• Low gross and net margins illustrate the capital-intensive, competitive nature of the auto industry
• Heavy investment in future mobility and electrification, balanced by ongoing cost controls
• Ongoing growth is driven by GM Financial and strategic bets on electric and autonomous vehicles

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FAQ About GM's Income Statement

1. What is the main source of GM's revenue in 2025?

GM generates over 90% of its revenue from automotive sales and related products. The remainder comes from GM Financial, which provides vehicle financing and leasing services.

2. How profitable is GM in Q3 2025?

GM reported net income of $1.33B in Q3 2025, with a net margin of approximately 2.9%, reflecting moderate profitability driven by scale but challenged by high costs and market headwinds.

3. What are the largest expense categories for GM?

The biggest expenses on GM's income statement are cost of revenue (vehicle production, materials, labor) and operating expenses, particularly SG&A at $2.04B in Q3 2025 (4.5% of revenue). R&D is significant but not separately disclosed for this quarter.

4. Why does Cruise operate at a loss?

Cruise, despite generating $0 in revenue, posted an operating loss in Q3 2025. This is because GM aggressively invests in autonomous vehicle technology and scaling operations, believing these will drive long-term growth—even if the division is unprofitable today.

5. How does GM's effective tax rate compare to previous years?

GM's effective tax rate in Q3 2025 was 8.9%, consistent with previous years. This moderate rate is primarily due to international structuring and tax benefits related to share-based compensation and investment credits.