General Motors has revised its financial targets for 2024 following a strong performance that exceeded Wall Street expectations in the second quarter. The automaker has adjusted its expected adjusted earnings for the year to a range of $13 billion to $15 billion, up from the previous estimate of $12.5 billion to $14.5 billion. Additionally, GM has increased its forecasts 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 over 7% from the previous year and surpassing Wall Street’s forecast of $45 billion, according to FactSet estimates. Earnings per share reached $3.06, exceeding analysts’ expectations of $2.71 and representing a 60% increase compared to 2023. The company’s net income grew 14% to $2.9 billion, an increase from $2.5 billion.
Following this announcement, GM’s stock rose nearly 5% in pre-market trading, bringing its year-to-date increase to more than 37%. The company also declared a third-quarter cash dividend, further boosting the stock’s appeal.
In a letter to shareholders, CEO Mary Barra highlighted the positive performance of GM’s gas-powered trucks and SUVs. She mentioned that the company is set to launch eight new or redesigned models in North America, covering various sizes from compact to full-size. Barra emphasized GM’s commitment to scaling production of the electric Chevrolet Equinox, stating that while there is excitement about electric vehicles (EVs) and early successes, the focus will remain on disciplined volume growth.
Earlier in the month, Barra acknowledged that GM would not meet its goal of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown. Despite this, the company’s EV sales had increased in the last quarter.
Barra also announced that Cruise, GM’s self-driving unit which had to scale back operations after an incident last October, will abandon its Origin vehicle. Instead, Cruise will focus on using the next-generation Chevrolet Bolt while testing in Texas and Arizona. GM incurred a $600 million charge related to the suspension of Origin production in Detroit.
During a call with analysts, Barra reassured that the choice of using the Bolt would address regulatory concerns regarding the unconventional design of the Origin, such as the absence of a steering wheel. She added that this shift would lower costs per unit and help GM optimize its resources.
“Our vision to transform mobility using autonomous technology remains unchanged, and each mile traveled, along with every simulation, brings us closer because Cruise is an AI-first company,” Barra stated.
Furthermore, GM is working on restructuring its joint venture with SAIC Motor in China as it continues to face losses, reporting a $104 million loss for the second quarter. In June, SAIC-GM reduced production by 70%, delivering only 26,000 vehicles, which is 50% fewer than the same period last year, according to Automotive News.