General Motors has increased its financial targets for 2024 after exceeding Wall Street’s expectations in its second-quarter performance. The Detroit-based auto manufacturer raised its projected adjusted earnings for the year to a range of $13 billion to $15 billion, up from a previous estimate of $12.5 billion to $14.5 billion. The company also adjusted its targets for operating cash flow and earnings per share, while expectations for net income attributable to shareholders were slightly reduced by less than 1%, now forecasted to be between $10 billion and $11.4 billion.
GM’s second-quarter revenue reached $47.9 billion, marking an increase of more than 7% compared to the prior year and surpassing Wall Street’s expectation of $45 billion, according to FactSet. Earnings per share stood at $3.06, exceeding the analysts’ forecast of $2.71 and representing a 60% increase from the previous year. Additionally, net income grew by 14%, reaching $2.9 billion, up from $2.5 billion.
Following this news, GM’s stock surged nearly 5% in pre-market trading on Tuesday and has risen over 37% this year. The company also announced a cash dividend for the third quarter, further boosting investor confidence.
In her letter to shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs and mentioned plans to launch eight new or redesigned models in North America. She emphasized the company’s commitment to disciplined growth in the electric vehicle (EV) sector, specifically with the production of the Chevrolet Equinox. However, 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 market conditions, stating that the company would adjust production based on demand.
Barra also shared that Cruise, GM’s self-driving division that had to scale back operations after an incident last October, will no longer pursue its Origin vehicle. Instead, Cruise will leverage the next-generation Chevrolet Bolt for testing in Texas and Arizona, which Barra indicated would address regulatory concerns regarding the Origin’s unconventional design. This shift is expected to reduce costs and optimize resources.
GM is navigating restructuring efforts in its joint venture with SAIC Motor in China, where it reported a $104 million loss for the second quarter. Earlier in June, SAIC-GM significantly reduced production by 70%, resulting in the delivery of only 26,000 vehicles, a 50% decline compared to the same period last year.