General Motors has raised several of its financial projections for 2024 following a strong performance that exceeded Wall Street forecasts in the second quarter.
The Detroit-based automaker has revised its anticipated adjusted earnings for the year to a range of $13 billion to $15 billion, an increase from the earlier estimate of $12.5 billion to $14.5 billion. Additionally, it has raised its targets for operating cash flow and earnings per share, while slightly reducing the forecast for net income attributable to shareholders to between $10 billion and $11.4 billion, a decrease of less than 1%.
In the second quarter, GM reported revenues of $47.9 billion, marking a more than 7% increase compared to the same period last year and surpassing Wall Street’s expectations of $45 billion, as per FactSet estimates. The company’s earnings per share reached $3.06, exceeding the projected $2.71, and representing a 60% increase from 2023. Net income rose by 14% to $2.9 billion, up from $2.5 billion.
Following the announcements, GM’s stock rose nearly 5% in pre-market trading, continuing a strong performance that has seen shares increase by over 37% this year. The automaker also declared a cash dividend for the third quarter, further boosting its stock value.
In a letter to shareholders, GM CEO Mary Barra highlighted the success of the company’s gasoline-powered trucks and SUVs, while mentioning the launch of eight new or redesigned models in North America. She also discussed the scaling up of production for the electric Chevrolet Equinox, reiterating GM’s commitment to disciplined growth in electric vehicle (EV) production, despite earlier acknowledging that the company will not meet its goal of producing one million EVs in North America by the end of 2025 due to a market slowdown.
Barra also provided an update on Cruise, GM’s self-driving unit, which recently reversed course on its Origin vehicle after an incident last October. The focus will now shift to the next-generation Chevrolet Bolt for testing purposes in Texas and Arizona. This decision comes after GM incurred a $600 million charge from halting production of the Origin.
During an analyst call, Barra explained that using the Bolt will address regulatory concerns about the Origin’s unconventional design, which includes the absence of a steering wheel. She also noted that this change would reduce costs per unit and help GM better allocate resources.
Finally, GM is working on restructuring its joint venture in China with SAIC Motor, as it continues to face losses. The company reported a loss of $104 million for the second quarter, with SAIC-GM cutting production by 70% and delivering 26,000 vehicles, which is half of what was delivered a year earlier.