General Motors (GM) has announced an increase in several financial targets for 2024 after exceeding Wall Street’s expectations in the second quarter of the year. The Detroit-based automaker has raised its anticipated adjusted earnings to a range of $13 billion to $15 billion, an increase from the previous estimate of $12.5 billion to $14.5 billion. Operating cash flow and earnings per share targets have also been adjusted upward, while the forecast for net income attributable to shareholders has been slightly reduced, now expected to be 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 same period last year and surpassing Wall Street’s $45 billion forecast, according to FactSet. Earnings per share reached $3.06, outpacing the $2.71 analysts had predicted and reflecting a 60% rise compared to 2023. The company’s net income rose by 14%, reaching $2.9 billion, up from $2.5 billion.
Following the announcement, GM’s stock rose nearly 5% in pre-market trading and has surged over 37% this year. Additionally, the company declared a third-quarter cash dividend after Monday’s trading session, contributing to the stock’s positive movement.
In a letter to shareholders, CEO Mary Barra praised the performance of GM’s gas-powered trucks and SUVs, mentioning that the company is in the process of launching eight new or redesigned vehicle models across various sizes in North America. She also highlighted the scaling up of production for the electric Chevrolet Equinox, emphasizing a commitment to disciplined volume growth despite previous setbacks in meeting electric vehicle production goals.
Earlier in the month, Barra indicated 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 aims to be flexible in its production strategy, adjusting output to align with demand, although it did see growth in electric vehicle sales last quarter.
In related developments, Barra disclosed that Cruise, GM’s self-driving division, would discontinue its Origin vehicle and instead utilize the Chevrolet Bolt for testing in Texas and Arizona. This decision follows a halt in Origin production after a previous incident. GM incurred a $600 million charge related to this production pause.
Barra reassured analysts that the vision to transform mobility through autonomous technology remains intact, stating that each mile traveled and every simulation brings the company closer to its goals.
Lastly, GM is looking to restructure its joint venture with SAIC Motor in China as it continues to face losses, with $104 million reported for the second quarter. Production was significantly reduced in June, with SAIC-GM cutting output by 70% and delivering only 26,000 vehicles, representing a 50% decrease from the previous year.