General Motors has upgraded its financial forecasts for 2024 following impressive second-quarter results that exceeded Wall Street expectations.
The automaker increased its anticipated adjusted earnings for the year to a range of $13 billion to $15 billion, up from a previous projection of $12.5 billion to $14.5 billion. Additionally, the targets for operating cash flow and earnings per share have also been raised, although the projected net income attributable to shareholders has been slightly lowered by less than 1%, now estimated at between $10 billion and $11.4 billion.
For the second quarter, GM reported revenue of $47.9 billion, reflecting an increase of over 7% from the previous year and surpassing Wall Street’s forecast of $45 billion, according to FactSet. Earnings per share reached $3.06, exceeding the anticipated $2.71 and representing a 60% increase compared to 2023. The company’s net income rose by 14% to $2.9 billion, compared to $2.5 billion in the same period last year.
In pre-market trading on Tuesday, GM’s stock surged nearly 5%. The shares have gained over 37% this year. Following the close of trading on Monday, the company announced a cash dividend for the third quarter, further boosting its stock value.
In a letter to shareholders, CEO Mary Barra highlighted the strong performance of GM’s gasoline-powered trucks and SUVs, mentioning the launch of eight new or redesigned models in North America. She also emphasized the scaling up of production for the electric Chevrolet Equinox, stating the company is excited about its electric vehicle (EV) developments while maintaining a focus on disciplined growth.
Earlier this month, Barra acknowledged 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. She reaffirmed the company’s intention to be flexible and “build to demand,” even as EV sales had increased in the last quarter.
Barra also revealed that GM’s self-driving unit, Cruise, which scaled back operations after an incident last October, will discontinue its Origin vehicle. Instead, Cruise will concentrate on testing the next-generation Chevrolet Bolt in Texas and Arizona. GM incurred a $600 million charge related to halting Origin production in Detroit.
During an analyst conference call, Barra mentioned that opting for the Bolt would address regulatory concerns regarding the unique design of the Origin, which lacked a steering wheel. This transition is expected to reduce per unit costs and improve resource optimization.
Barra reiterated the company’s commitment to transforming mobility with autonomous technology, stating that each mile traveled and simulation is bringing Cruise closer to its goals as an AI-driven organization.
Additionally, GM is seeking to restructure its joint venture with SAIC Motor in China, which has reported significant losses. The company recorded a loss of $104 million in the second quarter. In June, SAIC-GM decreased production by 70%, delivering only 26,000 vehicles—50% fewer than the previous year.