DETROIT – General Motors (GM) has announced a 25% increase in its quarterly dividend, raising it to 15 cents per share, aligning with its rival Ford Motor. This decision comes as part of GM’s strategy to reward investors despite challenges in the industry, including slowing sales and profits. The increased dividend is set to take effect with the next payout, planned for announcement in April. Additionally, GM is launching a $6 billion share repurchase program, with $2 billion in buybacks expected to be completed in the second quarter. The number of shares bought back will depend on the average daily volume-weighted price of GM’s stock during the program, executed by JPMorgan and Barclays.
GM CEO Mary Barra emphasized the company’s commitment to its capital allocation strategy, which focuses on reinvesting in the business, maintaining a strong balance sheet, and returning capital to shareholders. Since 2023, GM has announced $16 billion in stock buybacks, retiring over 400,000 shares. Despite robust quarterly results, GM’s shares have fallen more than 12% this year due to plateauing industry sales, regulatory uncertainties, and limited growth prospects.
GM CFO Paul Jacobson expressed confidence in the company’s business plan and balance sheet strength, affirming agility in responding to public policy changes. The board-approved repurchase authorization reflects GM’s ongoing commitment to its capital allocation policy. GM’s 2025 guidance projects net income between $11.2 billion and $12.5 billion, adjusted EBIT of $13.7 billion to $15.7 billion, and automotive free cash flow between $11 billion and $13 billion.
Outside the accelerated program, GM retains $4.3 billion for additional share repurchases, including $300 million from its previous $6 billion buyback initiative. As of last year, GM had fewer than 1 billion shares outstanding, achieving a target set earlier by Jacobson.
— news from CNBC