General Motors is adjusting several financial projections for 2024 following impressive results that exceeded Wall Street’s expectations in the second quarter. The automaker has increased its forecast for adjusted earnings for the year to a range of $13 billion to $15 billion, up from $12.5 billion to $14.5 billion. Additionally, GM has raised its targets for operating cash flow and earnings per share, while slightly lowering its expectations for net income attributable to shareholders to between $10 billion and $11.4 billion.
In the second quarter, GM reported revenues of $47.9 billion, which marks an increase of over 7% compared to the same period last year and surpasses the Wall Street estimate of $45 billion. Earnings per share reached $3.06, exceeding analyst expectations of $2.71, and representing a 60% increase from the previous year. Net income rose 14% to $2.9 billion, up from $2.5 billion.
Following these announcements, GM’s stock saw a nearly 5% increase in pre-market trading on Tuesday, bringing the stock’s rise to over 37% this year. Additionally, GM declared a cash dividend for the third quarter, providing further encouragement to investors.
In a letter to shareholders, CEO Mary Barra highlighted the strong performance of the company’s gas-powered trucks and SUVs and noted plans to introduce eight new or redesigned vehicle models in North America. She also mentioned the scaling up of production for the electric Chevrolet Equinox, emphasizing GM’s commitment to disciplined growth in the electric vehicle (EV) sector, despite acknowledging that the company would not meet its goal of producing 1 million EVs in North America by the end of 2025 due to a market slowdown.
Barra revealed that GM’s self-driving unit, Cruise, would discontinue its Origin vehicle and shift its focus to using the next-generation Chevrolet Bolt for testing in Texas and Arizona. This decision follows a $600 million charge related to pausing the production of the Origin. Barra explained that utilizing the Bolt addresses regulatory concerns about the unique design of the Origin while also helping to lower costs and optimize resources.
Furthermore, GM is working to restructure its joint venture in China with SAIC Motor as it continues to face losses, reporting a $104 million loss for the second quarter. In June, production was cut by 70%, leading to the delivery of only 26,000 vehicles, a 50% decline from the previous year.