General Motors has increased several financial forecasts for 2024 after exceeding Wall Street’s expectations for its second quarter results. The automaker now anticipates adjusted earnings for the year to be between $13 billion and $15 billion, an increase 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, while slightly lowering the expectations for net income attributable to shareholders by less than 1%, now projected to be between $10 billion and $11.4 billion.
The company’s second quarter revenue reached $47.9 billion, representing a more than 7% increase from the prior year and surpassing Wall Street’s anticipated $45 billion, according to FactSet. GM reported earnings per share of $3.06, exceeding the expected $2.71 and marking a 60% increase from 2023. Net income rose by 14% to $2.9 billion, compared to $2.5 billion.
GM’s stock surged nearly 5% in pre-market trading on Tuesday, having risen over 37% this year. The announcement of a third-quarter cash dividend contributed to the stock’s increase.
In a letter to shareholders, CEO Mary Barra highlighted the strong performance of the company’s gas-powered trucks and SUVs and mentioned plans to launch eight new or redesigned models in North America. She also discussed scaling production of the electric Chevrolet Equinox, reaffirming GM’s commitment to disciplined volume growth despite earlier comments that the company would not reach its goal of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown. GM has stated it will adapt production according to demand, even as EV sales experienced growth last quarter.
Barra also announced that GM’s self-driving unit, Cruise, which had to scale back operations following an incident last October, will discontinue its Origin vehicle and instead focus on the next-generation Chevrolet Bolt for testing in Texas and Arizona. GM incurred a $600 million charge related to stopping production of the Origin in Detroit.
During an analysts’ call, Barra emphasized that using the Bolt would mitigate regulatory concerns tied to the Origin’s unique design, such as its lack of a steering wheel. The change is expected to reduce per-unit costs and optimize resources.
“Our vision to transform mobility using autonomous technology is unchanged, and every mile traveled, and every simulation, brings us closer because Cruise is an AI-first company,” Barra stated.
GM is also working on restructuring its joint venture in China with SAIC Motor, which has faced ongoing losses, posting a $104 million loss in the second quarter. In June, SAIC-GM cut production by 70% with only 26,000 vehicle deliveries, a 50% decrease from the same period last year.