General Motors is updating its financial forecasts for 2024 following impressive second-quarter results that outperformed Wall Street expectations.
The automaker has increased its anticipated 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 raised its targets for operating cash flow and earnings per share. Meanwhile, the projected net income attributable to shareholders was slightly lowered by less than 1%, now expected to be between $10 billion and $11.4 billion.
In the second quarter, GM reported revenue of $47.9 billion, representing over a 7% increase from the previous year and surpassing Wall Street’s expectations of $45 billion, as per FactSet estimates. Earnings per share came in at $3.06, exceeding analyst expectations of $2.71 and reflecting a 60% increase compared to 2023. The company’s net income also saw a 14% rise, reaching $2.9 billion, up from $2.5 billion.
Following the announcement, GM’s stock experienced a nearly 5% increase in pre-market trading, and has surged more than 37% throughout the year. After Monday’s market close, GM declared a third-quarter cash dividend, further supporting the stock’s growth.
In communications with shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs, mentioning the launch of eight new or redesigned compact, mid-size, and full-size models in North America. She also discussed the scaling production of the electric Chevrolet Equinox and emphasized the company’s commitment to disciplined growth in the electric vehicle sector.
Earlier this month, Barra indicated that GM would likely miss its target of producing 1 million electric vehicles in North America by the end of 2025 due to market slowdowns. However, the company noted that its electric vehicle sales grew in the last quarter and emphasized flexibility in production based on demand.
Barra announced that Cruise, GM’s self-driving unit which faced setbacks after a previous incident, will discontinue its Origin vehicle to focus on the next-generation Chevrolet Bolt for testing in Texas and Arizona. GM incurred a $600 million charge related to halting production of the Origin in Detroit.
During a conference call with analysts, Barra asserted that opting for the Bolt would help mitigate regulatory concerns related to the Origin’s unconventional design, including the absence of a steering wheel. She added that this shift would lower production costs and allow GM to better manage resources.
“Our vision to transform mobility using autonomous technology remains intact, and with each mile traveled and every simulation, we move closer toward that goal because Cruise is fundamentally an AI-first company,” Barra stated.
Additionally, GM is working to reorganize its joint venture with SAIC Motor in China, where it has been experiencing losses, including a $104 million loss in the second quarter. In June, production was reduced by 70%, resulting in only 26,000 vehicle deliveries—50% lower than the previous year, according to Automotive News.