General Motors has revised its financial projections for 2024 following a robust second quarter that exceeded Wall Street expectations. The Detroit-based automaker has increased its adjusted earnings forecast for the year to a range of $13 billion to $15 billion, up from a prior estimate of $12.5 billion to $14.5 billion. It has also raised its targets for operating cash flow and earnings per share, although it slightly reduced expectations for net income attributable to shareholders by less than 1%, now projected between $10 billion and $11.4 billion.
For the second quarter, GM reported revenue of $47.9 billion, reflecting an over 7% increase from the previous year and surpassing the anticipated $45 billion. Earnings per share stood at $3.06, exceeding analysts’ expectations of $2.71 and representing a 60% increase compared to 2023. The company’s net income grew by 14%, reaching $2.9 billion, up from $2.5 billion last year.
In pre-market trading on Tuesday, GM’s stock experienced a nearly 5% increase, bringing its total growth for the year to over 37%. Following the end of trading on Monday, GM announced a cash dividend for the third quarter, contributing to the stock’s positive performance.
CEO Mary Barra highlighted the successful sales of GM’s gas-powered trucks and SUVs in a letter to shareholders, detailing plans for launching a total of eight new or redesigned vehicles in North America across different size categories. Barra mentioned the ongoing scale-up of production for the electric Chevrolet Equinox, reassuring shareholders of the company’s commitment to disciplined growth in electric vehicle production, despite acknowledging a shift away from the goal of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown.
Additionally, Barra revealed that Cruise, GM’s self-driving unit, will abandon production of its Origin vehicle, pivoting instead to using the Chevrolet Bolt for testing in Texas and Arizona. GM incurred a $600 million charge related to ceasing production of the Origin in Detroit.
During a call with analysts, Barra expressed that this strategy would address regulatory concerns regarding the Origin’s unconventional design, such as its absence of a steering wheel, while also reducing costs. She affirmed GM’s commitment to transforming mobility through autonomous technologies.
Lastly, GM is working to restructure its joint venture with SAIC Motor in China, amidst ongoing financial losses. The company reported a $104 million loss in this segment for the second quarter, as SAIC-GM drastically reduced production by 70%, delivering only 26,000 vehicles, which is a 50% decrease compared to the previous year.