General Motors has updated 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 of $13 billion to $15 billion, compared to the previous estimate of $12.5 billion to $14.5 billion. The company has also raised its targets for operating cash flow and earnings per share, while slightly lowering expectations for net income attributable to shareholders to between $10 billion and $11.4 billion.
For the second quarter, GM reported revenue of $47.9 billion, marking an increase of over 7% year-on-year and surpassing Wall Street’s anticipated $45 billion, according to FactSet estimates. Earnings per share reached $3.06, which was above the expected $2.71 and represented a 60% increase compared to the previous year. Net income rose 14% to $2.9 billion, up from $2.5 billion.
Following this announcement, GM’s stock surged nearly 5% in pre-market trading on Tuesday and has risen more than 37% in value this year. The company also declared a third-quarter cash dividend after markets closed on Monday, further supporting its stock prices.
In her letter to shareholders, CEO Mary Barra highlighted the strong performance of GM’s gas-powered trucks and SUVs, and mentioned the impending launch of eight new or redesigned models in the North American market. She emphasized the firm’s commitment to scaling production of the electric Chevrolet Equinox, while also acknowledging that GM will not meet its target of producing 1 million electric vehicles in North America by the end of 2025 due to a slowdown in the market. Despite this, EV sales increased in the last quarter.
Barra also discussed GM’s self-driving unit, Cruise, which had to scale back operations following an incident last October. The company will now focus on the next-generation Chevrolet Bolt instead of the previously planned Origin vehicle. This strategy is expected to reduce production costs and address regulatory concerns related to the Origin’s unconventional design.
In addition, GM is restructuring its joint venture in China with SAIC Motor amid ongoing losses, having incurred a $104 million loss in the second quarter. In June, SAIC-GM cut production by 70%, delivering 26,000 vehicles, which was 50% lower than the previous year.