General Motors digital business could be worth more than Wall Street thinks
UBS raised GM's price target to $114, citing growth in its digital business. GM's digital revenue is expected to grow from $3.2B in 2026 to $9.6B by 2036, with OnStar and Super Cruise as key drivers. Deferred digital revenue is projected to reach $15B over the next decade, with subscription revenue growing at a 47% CAGR.
How this was made
The 30-second read
Why it matters
The forecast underscores a strategic shift toward recurring, high‑margin digital services, which could re‑rate GM's valuation.
Market read
Analyst upgrade based on digital revenue growth may prompt investors to reassess GM's earnings outlook and valuation.
What to watch
Potential regulatory scrutiny of subscription pricing and the capital cost of expanding connectivity infrastructure.
Background
UBS released a new research note projecting GM's digital revenue to grow from $3.2 bn in 2026 to $9.6 bn by 2036 and raised its price target.
Ticker impact
UBS raised GM's price target to $114 and forecast rapid growth of its digital revenue, highlighting OnStar and Super Cruise as high‑margin recurring streams.
Potential upside of 5‑8% over the next few weeks if the market prices in the higher digital earnings multiple.
The upgrade is based on concrete revenue forecasts and a higher P/E multiple for digital earnings, which are less cyclical than core automotive sales.
Market effects
Highlights the growing importance of automotive software and subscription services across the auto sector.
May boost sentiment for US auto manufacturers and related suppliers.
Signals a shift toward digital revenue models for global automakers.
Counterpoint
If digital adoption slows or competition intensifies, the higher multiple may be unjustified, limiting upside.
Key entities
- companyGeneral Motors Company
US‑listed automaker (NYSE:GM) expanding digital services.
- research_firmUBS
Investment bank providing the upgraded price target and revenue forecasts.
