General Motors has revised its financial forecasts for 2024 following strong performance that exceeded Wall Street predictions for the second quarter.
The Detroit-based automaker has increased its projected adjusted earnings for the year to between $13 billion and $15 billion, up from the previous range of $12.5 billion to $14.5 billion. Additionally, it 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 an increase of more than 7% compared to the same period last year, and surpassing Wall Street’s $45 billion estimate. The company’s earnings per share reached $3.06, exceeding the $2.71 forecast by analysts and reflecting a 60% increase from 2023. Net income also rose 14%, totaling $2.9 billion, up from $2.5 billion.
As a result of this positive news, GM’s stock surged nearly 5% in pre-market trading on Tuesday and has increased more than 37% this year. Following the close of trading on Monday, GM announced a cash dividend for the third quarter, further boosting investor confidence.
In a letter to shareholders, CEO Mary Barra highlighted the strong sales of GM’s gas-powered trucks and SUVs. She noted that the company plans to launch eight new or redesigned compact, mid-size, and full-size models in North America, and is scaling production of the electric Chevrolet Equinox. Barra emphasized GM’s commitment to disciplined growth despite recent setbacks in achieving the goal of producing 1 million electric vehicles in North America by the end of 2025, citing a slowdown in the market.
Barra also announced that Cruise, GM’s self-driving division, will discontinue its Origin vehicle in favor of the next-generation Chevrolet Bolt for testing purposes in Texas and Arizona. This adjustment comes after Cruise faced challenges that led to a reduction in its operations. GM incurred a $600 million charge associated with halting production of the Origin.
During a conference call with analysts, Barra reassured that the decision to use the Bolt would address regulatory concerns about the Origin’s unconventional design. She stated that this change would reduce costs and allow GM to better allocate its resources.
GM is also working on restructuring its joint venture in China with SAIC Motor, as it continues to experience losses—recording a $104 million loss for the second quarter. In June, SAIC-GM reduced production by 70%, delivering 26,000 vehicles, which is half of what was delivered a year earlier, according to industry reports.