UPDATE: GM Posts Lower Q2 Profit, Shares Drop

General Motors

reported an 85% drop in its second-quarter profit due to a $1.2 billion recall charge. The Detroit, Michigan-based company posted a quarterly net profit of $190 million, or $0.11 per share, versus a year-earlier profit of $1.26 billion, or $0.75 per share. Excluding one-time items GM earned $0.58 per share. GM has recalled around 30 million vehicles so far this year. The company has set aside $400 million for its victims' compensation fund. The results also included $200 million in restructuring costs. Its revenue rose to $39.6 billion from $39.1 billion. However, analysts were expecting earnings of $0.59 per share on revenue of $40.59 billion. GM CEO Mary Barra said, "Our underlying business performance in the first half of the year was strong as we grew our revenue on improved pricing and solid new vehicle launches." GM shares fell 1.90% to $36.70 in pre-market trading.