General Motors has increased its financial projections for 2024 after exceeding Wall Street expectations in its second quarter results. The Detroit-based automaker has adjusted its forecasted adjusted earnings for the year to between $13 billion and $15 billion, up from a previous range of $12.5 billion to $14.5 billion. Additionally, it revised its operating cash flow and earnings per share targets. The anticipated net income attributable to shareholders was slightly reduced by less than 1%, now estimated to be between $10 billion and $11.4 billion.
In the second quarter, GM reported revenues of $47.9 billion, marking a rise of over 7% from the prior year and surpassing analyst expectations of $45 billion, according to FactSet estimates. Earnings per share stood at $3.06, exceeding the expected $2.71 and reflecting a 60% increase compared to 2023. Net income rose 14% to $2.9 billion, compared to $2.5 billion last year.
Following the announcement, GM’s stock rose nearly 5% in pre-market trading, having increased more than 37% this year. The company also declared a third-quarter cash dividend after the market closed on Monday.
In communication with shareholders, CEO Mary Barra highlighted the robust performance of GM’s gas-powered trucks and SUVs, mentioning the launch of eight new or redesigned models in North America. She also indicated that the production of the electric Chevrolet Equinox is ramping up, affirming GM’s commitment to careful growth in electric vehicle (EV) output.
However, Barra acknowledged earlier this month that GM would not meet its target of manufacturing 1 million EVs in North America by the end of 2025 due to a market slowdown. The company has stated it will adapt production based on demand, with EV sales experiencing growth in the last quarter.
Additionally, Barra revealed that GM’s self-driving subsidiary, Cruise, which scaled back operations after a setback last October, will discontinue its Origin vehicle development. Instead, Cruise plans to utilize the next-generation Chevrolet Bolt for its testing programs in Texas and Arizona. GM recorded a $600 million charge linked to the suspension of Origin production.
Barra explained that the decision to use the Bolt addresses regulatory concerns regarding the unique design of the Origin, which lacks a steering wheel. This strategy is expected to reduce costs and optimize resources.
“Our vision to transform mobility using autonomous technology remains steadfast,” Barra stated, noting that each journey and simulation brings Cruise closer to its objectives as an AI-focused company.
Moreover, GM is working to restructure its joint venture in China with SAIC Motor due to ongoing financial losses, reporting a $104 million loss for the second quarter. In June, SAIC-GM reduced production by 70%, delivering 26,000 vehicles, which is a 50% decline from the previous year, as reported by Automotive News.