General Motors has updated its financial projections for 2024 after exceeding Wall Street expectations for its second-quarter results.
The automaker has adjusted its anticipated adjusted earnings for the year to a range between $13 billion and $15 billion, an increase from the previous estimate of $12.5 billion to $14.5 billion. Additionally, GM has raised its targets for operating cash flow and earnings per share, while slightly lowering expectations for net income attributable to shareholders to between $10 billion and $11.4 billion.
In the second quarter, GM reported revenue of $47.9 billion, marking over a 7% growth compared to the previous year and surpassing the Wall Street estimate of $45 billion. Earnings per share were reported at $3.06, exceeding the expected $2.71 and representing a 60% increase from 2023. Net income rose 14% to $2.9 billion, up from $2.5 billion in the same period last year.
Following the announcement, GM’s stock saw a nearly 5% increase in pre-market trading and has risen more than 37% this year. The company also declared a cash dividend for the third quarter, contributing to stock gains.
In a letter to shareholders, CEO Mary Barra emphasized the success of GM’s gas-powered trucks and SUVs and mentioned the launch of eight new or redesigned models in North America. Barra highlighted the scaling up of production for the electric Chevrolet Equinox, expressing the company’s excitement for electric vehicles (EVs) while committing to disciplined growth in production.
Earlier this month, Barra acknowledged that GM would not meet its target of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown. The company has indicated a flexible approach to production, aiming to adjust output according to demand, though it reported growth in EV sales last quarter.
Additionally, Barra revealed that Cruise, GM’s autonomous vehicle division, would halt the production of its Origin vehicle and instead utilize the next-generation Chevrolet Bolt for testing in Texas and Arizona. GM incurred a $600 million charge related to the halt in production of the Origin.
During a call with analysts, Barra stated that transitioning to the Bolt would help alleviate regulatory concerns about the Origin’s unconventional design and allow for better resource optimization.
“Our vision to transform mobility using autonomous technology remains firm, and with every mile traveled and every simulation, we are getting closer, as Cruise operates as an AI-first company,” Barra concluded.
GM is also working on restructuring its joint venture in China with SAIC Motor, as it continues to face losses, reporting a $104 million loss for the second quarter. Production by SAIC-GM was cut by 70% in June, resulting in 26,000 vehicles delivered, which was a 50% decrease compared to the prior year.