GM Beat Earnings and Announced a $20 Billion Buyback. Its Stock Still Tanked 5%.

Tuesday morning was supposed to be a good day for General Motors. The automaker beat Wall Street’s profit forecast, raised the bottom end of its full-year outlook, and unveiled a $20 billion stock buyback. The stock responded by falling more than 5%.

Welcome to earnings season in late 2026, where beating the quarter no longer matters. The only thing the market wants to hear is what comes next, and GM’s message was: we are raising the floor, but we are also lowering the ceiling. Investors heard the second part.

It was a strange, busy morning on Wall Street. GM, GE Aerospace, 3M, RTX, Hasbro, and Halliburton all reported before the open. Oil pushed above $106 a barrel. The federal government formally banned a Chinese AI model from its computer systems. And after the closing bell tonight, the market gets something it has almost never seen before: the second-ever earnings report from Elon Musk’s SpaceX, plus results from Netflix and United Airlines.

Let us walk through all of it.

The Beat That Was Not Enough

On paper, GM’s third quarter was genuinely strong. Adjusted earnings came in at $3.70 a share, ahead of the $3.61 consensus. Revenue hit $50.02 billion, up nearly 3% from a year ago. Adjusted operating profit jumped 21.6% to $4.11 billion, with margins in North America expanding to 8.7% from 6.2% a year earlier. Net income attributable to shareholders tripled to $3.34 billion. The full pre-open earnings picture included beats across the industrial board, from GE Aerospace to 3M.

The company even told shareholders it is sending more cash their way. GM announced a new $20 billion multi-year share repurchase program, after finishing off a $6 billion buyback it started in January. The share count is already down to 849 million from 904 million at the end of 2025.

So why did the stock get hit? Because of guidance. GM narrowed its full-year outlook to a range of $12.75 to $13.75 in adjusted earnings per share, from a prior range of $12.00 to $14.00. The midpoint did not change at all, at $13.25. But trimming the top of the range is a message, and traders read it as one: the company thinks the upside case for the rest of the year just got harder to see.

The culprit is costs. GM said commodity inflation is running at about $2 billion, the high end of what it previously expected. The company raised the bottom of its free cash flow forecast to a range of $11.5 to $12.5 billion, which is good, but when input costs are eating into the best-case scenario, the market does not reward the floor. It punishes the ceiling.

GM’s stock was trading around $77.94 in premarket action, down from Monday’s close of $82.75. That is a roughly 5% drop on a day the company announced it would hand $20 billion back to shareholders. If that feels unfair, it is also the clearest signal of what this earnings season is about: optimism is priced in, and anything less than a raise on both ends gets sold.

Meanwhile, the Rest of Industrial America Had a Better Morning

GM’s rough morning did not ruin the day for everyone. GE Aerospace was the star of the pre-open batch. The jet engine maker reported a 25% jump in revenue to $14.12 billion and beat adjusted earnings per share by 12%, then lifted its full-year profit guidance. When a company raises guidance, the stock usually says thank you. GE’s move was the mirror image of GM’s: same beat, different forecast, different reception.

3M also delivered a clean result. The conglomerate posted adjusted earnings of $2.50 a share, twelve cents ahead of expectations, on revenue of $6.58 billion, up 4.2% from last year. Management added a small upgrade to full-year guidance. The stock reacted the way textbooks say it should: up.

Defense giant RTX reported too, alongside Hasbro, which raised its annual revenue forecast on a strong digital gaming quarter, and Halliburton, whose adjusted earnings edged 3.4% higher on a 1.8% revenue increase.

The pattern from the morning is simple: this season, the number you reported matters less than the number you are promising. Beat and raise wins. Beat and narrow loses. Nobody is getting credit for the past anymore.

Tonight: SpaceX’s Second-Ever Earnings and the Netflix Test

After the close today, the market gets the event of the week so far. SpaceX will release third-quarter results, only its second earnings report since going public in June. The company is expected to report revenue of around $12.9 billion, more than doubling from the same quarter a year ago when it was still private, and possibly its first quarterly profit, at roughly 14 cents a share.

The stakes are enormous. In its first report, SpaceX disclosed $7.8 billion in second-quarter revenue alongside a $541 million net loss and $15.8 billion in AI-related capital spending. The entire question tonight is whether that spending is starting to turn into revenue. Analysts describe the stock as trading on one metric: how fast the AI business converts contracted computing capacity into actual revenue, instead of being funded by cash flow from Starlink.

Starlink itself is a subplot worth watching. The satellite internet business doubled its subscriber base to 12 million over the past year, but average revenue per user fell from $85 to $66. More customers, less money per customer. Investors will want to hear whether the company’s push into mobile connectivity can start fixing that trend.

Options traders are pricing a swing of up to 7.5% in either direction after the report. The stock is up roughly 10% since the June IPO but sits well below its post-listing peak above $225. Analysts remain mostly bullish, with an average price target implying close to 47% upside, but tonight’s numbers are the first real test of whether that optimism survives contact with the AI spending bill.

Netflix reports after the close too, and it arrives with drama. The streamer recently cut about 1,000 jobs and parted ways with its longtime content chief Bela Bajaria, with former Disney television executive Peter Rice taking over content later this month. Consensus expects earnings of 82 cents a share on about $12.87 billion in revenue. The stock is down roughly 44% from its one-year high, so expectations are low, which is sometimes the best setup a company can ask for. Sometimes.

United Airlines also reports tonight, giving investors a read on travel demand and pricing power heading into the holidays. It is the quietest of the three after-close reports, but in a week this crowded, quiet can still move.

The Bigger Picture: Oil, the Fed, and a DeepSeek Ban

Three background stories are worth your attention, because they set the terms for everything this week.

First, oil. WTI crude pushed above $106 a barrel on Tuesday, after touching levels not seen since April. The ongoing conflict involving Iran keeps supply risk in the price. Higher oil feeds directly into inflation readings, and after September’s hot CPI print of 3.7% and a wholesale inflation surge, nobody needs another push on prices right now.

Second, the Fed. The central bank is now in its blackout period ahead of the October 27-28 meeting, meaning no official will speak publicly until the decision. Chair Kevin Warsh’s last remarks in Bangkok on October 16 offered no clues. Traders currently see a roughly 72% chance that rates stay on hold this month, with a December hike heavily priced in. With the meeting a week away and no more speeches coming, every data point lands with extra force.

Third, Washington formally shut out a Chinese AI model. The Department of Homeland Security published an order in the Federal Register on Tuesday requiring federal civilian agencies to remove DeepSeek products from their IT systems and banning future purchases, warning of multiple threat vectors including possible data transfer to China. It is the latest step in the widening US-China technology standoff, landing the same week the market is pricing AI credit risk into everything from CoreWeave’s debt to SoftBank’s balance sheet.

What to Watch Next

• Tonight after the close: SpaceX (first profit on the line, 7.5% move priced in), Netflix (new content chief, beaten-down stock), United Airlines (holiday travel demand).
• Wednesday: Meta and Tesla report after the close, with Philip Morris, Lam Research, and SAP on the calendar. The AI spending debate that started with SpaceX gets its biggest test of the week at Meta.
• Thursday: Procter and Gamble, Union Pacific, Lockheed Martin, and Valero report before the open; unemployment claims land at 8:30 a.m. ET.
• Next Tuesday and Wednesday: the Fed’s October meeting, with the market leaning toward a hold and a December hike still on the table.

The lesson from Tuesday morning is the lesson of this whole season: the market is not grading the quarter you just finished. It is grading the one you are promising. GM beat everything and promised a little less, and it lost 5% before lunch. Tonight, SpaceX and Netflix get to make their own promises. The market is listening, and it is not in a forgiving mood.