General Motors has updated its financial projections for 2024, boosting its expectations after exceeding Wall Street’s estimates for the second quarter. The Detroit-based automaker revised its anticipated adjusted earnings for the year to a range of $13 billion to $15 billion, up from $12.5 billion to $14.5 billion. It also raised its targets for operating cash flow and earnings per share, while slightly lowering its forecast 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, representing over a 7% increase from the previous year and exceeding Wall Street’s expectation of $45 billion, according to FactSet estimates. The company achieved earnings per share of $3.06, surpassing analysts’ predictions of $2.71 per share, and marking a significant 60% increase from 2023. Net income rose by 14% to $2.9 billion, compared to $2.5 billion the prior year.
Following the announcements, GM’s stock surged nearly 5% in pre-market trading and has seen an increase of more than 37% this year. The company also declared a third-quarter cash dividend, contributing to the stock’s positive movement.
In a letter to shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs, mentioning plans to launch eight new or redesigned models across various sizes in North America. She also discussed the ramp-up in production of the electric Chevrolet Equinox, emphasizing a commitment to disciplined growth despite excitement over early successes in the electric vehicle (EV) domain.
Earlier this month, Barra acknowledged that GM would not reach its target of producing 1 million electric vehicles in North America by the end of 2025, attributing this to a slow market. However, the company continues to adapt by producing based on demand, although it reported an uptick in EV sales during the last quarter.
Additionally, Barra announced that Cruise, GM’s autonomous driving division, would abandon its Origin vehicle, instead opting to utilize the next-generation Chevrolet Bolt for testing purposes in Texas and Arizona. This shift comes after Cruise had to scale back operations following an incident last October, leading GM to incur a $600 million charge for halting Origin production.
In a call with analysts, Barra mentioned that using the Bolt would address regulatory concerns regarding the Origin’s unconventional design, including its lack of a steering wheel. This change aims to reduce costs per unit and better allocate resources.
GM is also working on restructuring its joint venture in China with SAIC Motor, as it continues to face financial challenges; the company reported a $104 million loss in the second quarter. In June, SAIC-GM reduced production by 70%, delivering 26,000 vehicles—50% fewer than the same period last year, as reported by Automotive News.