European losses weigh on GM profits; China, U.S. business strong General Motors Co. profits dipped during the third quarter, hurt by Europe's economic slump, but were better than Wall Street expected and highlighted the strength of the automaker's operations in North America and Asia. GM said Wednesday that its net income fell to $1.5 billion from $1.7 billion in the same period a year earlier, a 12% slide. Excluding one-time items, GM earned 93 cents per share, beating the estimate by Wall Street analysts of 60 cents. Revenue rose to $37.6 billion from $36.7 billion. "While we still have a lot of work to do, especially in Europe, it is encouraging to see our results begin to reflect the discipline we are bringing to bear on the overall business," said Dan Ammann, GM chief financial officer. Investors agreed. GM shares rose $1.96, or 8.5%, to $25.24 in mid-day trading. "GM offers the most upside of any auto stock we cover," said Adam Jonas, Morgan Stanley Research analyst. But he also noted that it presents the most risk, in part because of the thorny problems restricting its operations in Europe, where differing regulations in national governments prevent the type of broad restructuring the auto industry and GM underwent during the recent U.S. recession. "We believe the stock has significant upside potential that can best be triggered by decisive strategic action in Europe," Jonas said. GM's urgency and investor patience are key ingredients for the stock to work.  GM lost $478 million in Europe in the third quarter compared to a loss of $292 million in the same period a year earlier. The Detroit automaker said it expects to lose $1.5 billion to $1.8 billion in Europe this year. PHOTOS: Hottest cars from 2012 SEMA show Other automakers are also suffering in Europe, where auto sales are at a 20-year low and are not expected to rebound any time soon. Ford Motor Co. said earlier this week that its losses were widening in Europe and would reach $1.5 billion this year. On Wednesday, the Eurostat agency said unemployment in the Eurozone hit 11.6%, the highest level on record. Some 18.5 million people are now unemployed in the 17 nations that make up the monetary union. GM doesn't expect to break even, let alone make a profit, in Europe until mid-decade. The automaker's other overseas operations performed well. Operating profits in Asia - primarily ventures in China - soared 89% to $689 million. South America swung to a profit of $114 million from a loss of $44 million. In North America GM posted an operating profit of $1.8 billion, down from $2.2 billion a year ago. A rebound of U.S. sales at Toyota Motor Corp. and Honda Motor Co., both hurt by production and inventory problems caused by the earthquake and tsunami in Japan last year, ate into GM's market share, said Jesse Toprak, an analyst with auto price information company TrueCar.com. GM is the last of the U.S. automakers to report third-quarter financial results and will likely draw the most attention because of the 2009 bankruptcy restructuring and federal bailout. Taxpayers still own about 26% of the company's shares on a fully diluted basis - after all outstanding stock options and warrants are exercised. GM's shares need to trade at more than $50, double Wednesday's price, for the government to recoup its investment in the automaker. GM's quarterly earnings will be scrutinized more closely than usual with the U.S. election just a week away and the auto bailout still an issue on the campaign trail. But anyone looking for political artillery in these numbers will likely be disappointed," said Jessica Caldwell, an analyst with auto information company Edmunds.com. Earlier this week, Ford reported a third-quarter profit of just over $1.6 billion, down $18 million from the same period a year earlier. Revenue dipped 3% to $33.1 billion. Chrysler Group on Monday said profits soared in the third quarter, helped by a remake of its product lineup and the introduction of the Dodge Dart compact sedan. The Auburn Hills, Mich., automaker said its net income rose 80% to $381 million compared with the same period a year earlier. Revenue rose 18% to $15.5 billion. Chrysler CEO refutes Romney claim Upstart Tesla battles auto dealers Consumer Reports reliability ratings