General Motors has updated its financial targets for 2024 following a strong second quarter that exceeded Wall Street’s expectations. The automaker has raised its forecast for adjusted earnings to a range of $13 billion to $15 billion, up from the previous estimate of $12.5 billion to $14.5 billion. Additionally, GM has increased its targets for operating cash flow and earnings per share, although the projected net income attributable to shareholders has been adjusted downward slightly to between $10 billion and $11.4 billion.
In the second quarter, GM reported revenues of $47.9 billion, marking over a 7% increase from the previous year and surpassing the anticipated $45 billion according to FactSet estimates. Earnings per share reached $3.06, exceeding analysts’ expectations of $2.71 per share and reflecting a 60% increase compared to 2023. The company’s net income grew 14% to $2.9 billion, up from $2.5 billion.
Following these results, GM’s stock rose nearly 5% in pre-market trading, contributing to a more than 37% increase for the year. The company also declared a third-quarter cash dividend, bolstering investor confidence.
In a letter to shareholders, CEO Mary Barra highlighted the popularity of GM’s gasoline-powered trucks and SUVs. She mentioned that the company is set to launch eight new or redesigned vehicle models in North America. Barra also discussed the ramp-up in production of the electric Chevrolet Equinox, emphasizing a commitment to disciplined volume growth despite earlier statements that GM would not meet its goal of producing 1 million electric vehicles in North America by the end of 2025 due to market challenges.
Additionally, Barra announced a strategic pivot for Cruise, GM’s self-driving unit, which will discontinue the Origin vehicle and instead focus on utilizing the next-generation Chevrolet Bolt for testing purposes in Texas and Arizona. This decision follows a production halt for the Origin, which resulted in a $600 million charge for GM.
In her remarks, Barra assured that the company’s commitment to transforming mobility through autonomous technology remains strong. She noted that each mile and simulation brings Cruise closer to achieving its goals.
Furthermore, GM is restructuring its joint venture in China with SAIC Motor, as it has been facing losses, including a $104 million loss for the second quarter. Production was cut by 70% in June, with only 26,000 vehicles delivered, reflecting a 50% drop compared to the previous year.