General Motors has announced an increase in several financial targets for 2024 following a strong performance in the second quarter that exceeded Wall Street’s expectations.
The automaker has raised its projected adjusted earnings for the year to a range of $13 billion to $15 billion, up from earlier estimates of $12.5 billion to $14.5 billion. GM also updated its targets for operating cash flow and earnings per share, while adjusting the expectations for net income attributable to shareholders slightly downward to between $10 billion and $11.4 billion.
In its second quarter, GM reported revenue of $47.9 billion, marking a more than 7% increase from the previous year and surpassing the expected $45 billion. The earnings per share were recorded at $3.06, exceeding analysts’ expectations of $2.71 and showing a 60% increase from 2023. Net income rose by 14% to $2.9 billion, up from $2.5 billion a year earlier.
Following this news, GM’s stock saw a nearly 5% rise in pre-market trading, contributing to a year-to-date increase of over 37%. The company also declared a third-quarter cash dividend after trading closed on Monday, which bolstered the stock’s appeal.
In a letter to shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs, stating that the company is launching eight new or redesigned models across various segments in North America. She emphasized the scaling of production for the electric Chevrolet Equinox, noting GM’s commitment to disciplined volume growth despite earlier remarks indicating that the company would not meet its goal of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown. However, EV sales did show growth in the last quarter.
Barra also announced changes for Cruise, GM’s self-driving unit, which will discontinue its Origin vehicle in favor of next-generation Chevrolet Bolts for testing in Texas and Arizona. This decision comes in the wake of a production halt related to the Origin and a $600 million charge. Barra indicated that using the Bolt would address regulatory concerns about the unique design of the Origin while also lowering production costs.
GM is also working on restructuring its joint venture with SAIC Motor in China, where the company faced a $104 million loss in the second quarter. In June, SAIC-GM reduced production by 70%, delivering 26,000 vehicles, which is 50% fewer than the same period last year.