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GM Profit Beats Street, but Europe Drags Down Results

General Motors'net income fell sharply in the first quarter, hurt by losses in Europe and a big accounting charge.

GM Headquarters
AP
GM Headquarters

But the results beat Wall Street estimates and GM turned in a strong performance in North America.

GM earned $1 billion, or 60 cents per share, in the first quarter. That compared with $3.2 billion, or $1.77 per share, a year earlier, when earnings were boosted by the sale of GM's stake in a parts company.

In the latest quarter, the company lost $256 million before taxes in Europe and took a $590 million charge due to a change in its European pension values.

Chief Financial Officer Dan Amman said there won't be any "big bang" action to return Europe to profitability. "It's an ongoing set of actions," he said.

But GM's overall results got a boost from North America, where it earned $1.7 billion before taxes. GM also posted an $83 million profit in South America.

Quarterly revenue rose 4 percent to $37.8 billion.

Excluding one-time charges, GM earned 93 cents per share in the quarter. That soundly beat Wall Street estimates of 85 cents on revenue of $37.9 billion.

The results were GM's sixth straight quarterly profit since its initial public stock offering in November of 2010. The company posted a net profit of $3.2 billion in the first quarter of last year.

Former GM vice chairman Bob Lutz, a CNBC contributor, took a broader view on the car company's earnings later Thursday.

The focus on Europe is "way overplayed," he told Squawk on the Street. "Put in context with rest of the world, it hardly matters."

Everybody’s having a problem in Europe, he added.

"Ford is losing money in Europe, GM’s losing money in Europe, Fiat is losing money in Europe. It’s just the general economy," he said. "GM is not quite as well positioned because a lot of the costs are in Germany, and that’s the part that has to be fixed."

As for North America, "it’s not going to be a super year in the U.S.," he said. "There lot of uncertainty before the [presidential] election, economic growth isn’t very robust. We are seeing some good replacement demand but the company is moderately optimistic" on its sales and volume projections.

CNBC.com contributed to this report.

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