CLEVELAND (AP) -- Goodyear Tire & Rubber Co.'s profit more than doubled in the third quarter, helped by cost-cutting, new products and lower raw material costs. But its shares plummeted on its forecast for lower operating income in its key North American market this quarter.
The third-quarter performance disclosed Wednesday marked a reversal by Goodyear, which had reported $554 million in losses in the first six months of the year as the recession staggered the automotive industry, a key customer.
The company, the biggest U.S. tiremaker, said it expects year-over-year global industry growth in 2010 and said its new products, especially high-end tires, and cost-cutting would give it the opportunity to capitalize on the opportunity.
"The strength of our brands and steady stream of new and innovative tires such as our branded fuel-efficient tires provided marketplace momentum and led a strong third quarter performance," said Robert J. Keegan, chairman and CEO.
Analysts pressed company executives in a conference call on the company's outlook for its home North American market.
Executives said the issues included fixed costs, seasonal sales trends and material expenses.
"Overall the world's economies are showing increasing signs of recovery but certainly not as fast, as strong or as consistently as we'd all like to see globally," Keegan said in the call.
Goodyear shares, which had been up in premarket trading, tumbled $3.20, or 19.1 percent, to $13.54 in midday trading.
The company earned $72 million, or 30 cents per share, in the July-September period compared with $31 million, or 13 cents per share, a year ago.
Revenue fell to $4.4 billion from $5.2 billion a year ago.
Goodyear said it earned 45 cents before charges. That beat the 40 cents a share that analysts surveyed by Thomson Reuters expected, on average. Analysts typically exclude one-time items from their estimates.
For the first nine months of the year, Goodyear lost $482 million, or $2 per share, on revenues of $11.9 billion, compared with earnings of $253 million, or $1.05 per share, on revenues of $15.4 billion a year ago.
Goodyear squeezed out $195 million in additional savings during the third quarter and has trimmed $540 million in expenses in the first nine months of the year.
During the third quarter, Goodyear trimmed its global work force by 300 jobs and eliminated about 5,500 in the January-June period, passing the 2009 target of 5,000.