General Motors has revised its financial outlook for 2024 after exceeding Wall Street’s expectations in the second quarter. The Detroit-based automaker has increased its projected adjusted earnings for the year to a range between $13 billion and $15 billion, up from the previous estimate of $12.5 billion to $14.5 billion. It also raised its targets for operating cash flow and earnings per share, although it slightly lowered the 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 a year-over-year increase of more than 7% and surpassing Wall Street’s expectation of $45 billion. Earnings per share stood at $3.06, exceeding analyst predictions of $2.71 and showing a 60% increase compared to 2023. The net income rose by 14%, reaching $2.9 billion, up from $2.5 billion.
Following the announcement, GM’s stock price surged nearly 5% in pre-market trading and has gained over 37% this year. Additionally, GM declared a third-quarter cash dividend, further boosting investor confidence.
In a letter to shareholders, CEO Mary Barra highlighted the strong performance of GM’s gas-powered trucks and SUVs and mentioned the upcoming launch of eight new or redesigned models across various sizes in North America. She also addressed the scaling of production for the electric Chevrolet Equinox, emphasizing the company’s commitment to disciplined growth in the electric vehicle (EV) sector.
However, Barra acknowledged that GM would not meet its target of producing 1 million electric vehicles in North America by the end of 2025, attributing this shortfall to a slowdown in the market. While GM has vowed to adapt its production to market demand, it did see growth in EV sales last quarter.
Additionally, Barra announced that Cruise, GM’s self-driving division, would discontinue its Origin vehicle and instead focus on testing the next-generation Chevrolet Bolt in Texas and Arizona. This decision follows a $600 million charge related to the halted production of the Origin.
Barra noted that using the Bolt would address regulatory concerns regarding the Origin’s unconventional design, including its lack of a steering wheel. The switch is expected to reduce costs per unit and enable GM to better allocate its resources.
Despite the changes, Barra affirmed the company’s commitment to transforming mobility through autonomous technology. GM is also working to restructure its joint venture in China with SAIC Motor, where it has been experiencing financial losses, recording a $104 million loss in the second quarter. In June, SAIC-GM reduced production by 70%, delivering only 26,000 vehicles, a 50% decline compared to the previous year.