General Motors is adjusting its financial outlook for 2024 after exceeding Wall Street expectations in its latest quarterly results. The Detroit-based automaker increased its projected adjusted earnings for the year to a range of $13 billion to $15 billion, up from the previous forecast of $12.5 billion to $14.5 billion. It also raised its targets for operating cash flow and earnings per share, while slightly lowering the 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, which marks an increase of over 7% compared to the same period last year and surpasses the $45 billion anticipated by analysts. Earnings per share reached $3.06, exceeding the expected $2.71, representing a 60% increase from 2023. Net income rose by 14% to $2.9 billion, up from $2.5 billion.
The company’s shares surged nearly 5% in pre-market trading following the announcement, and the stock has risen more than 37% throughout the year. Additionally, GM announced a third-quarter cash dividend after market close on Monday, further boosting investor confidence.
In her letter to shareholders, CEO Mary Barra highlighted the strong performance of GM’s gas-powered trucks and SUVs and mentioned plans to launch eight new or redesigned models in North America. She also discussed the increasing production of the electric Chevrolet Equinox, emphasizing GM’s commitment to steady volume growth in the electric vehicle sector, despite acknowledging that the goal of producing 1 million electric vehicles in North America by the end of 2025 will not be met due to a market slowdown.
Barra also announced that Cruise, GM’s self-driving division, will discontinue its Origin vehicle following a setback in operations last October. Instead, Cruise will focus on utilizing the next-generation Chevrolet Bolt for testing in Texas and Arizona. This shift is expected to address regulatory concerns over the unique design of the Origin and reduce production costs.
Barra reassured analysts that GM’s vision for utilizing autonomous technology in transportation remains intact, as the company continues to work towards its goals with Cruise.
Additionally, GM is restructuring its joint venture in China with SAIC Motor, which is experiencing ongoing financial challenges; the company reported a $104 million loss for the second quarter. In June, SAIC-GM reduced production by 70%, delivering 26,000 vehicles, which is 50% lower than the previous year.