General Motors is increasing several financial projections for 2024 after exceeding Wall Street’s expectations in its second quarter results. The automaker now anticipates adjusted earnings for the year to fall between $13 billion and $15 billion, an increase from the previous forecast of $12.5 billion to $14.5 billion. GM also raised its targets for operating cash flow and earnings per share, while slightly lowering the expected net income for shareholders to between $10 billion and $11.4 billion.
In the second quarter, GM reported revenue of $47.9 billion, representing a rise of over 7% compared to the same period last year, surpassing Wall Street’s expectation of $45 billion. Earnings per share reached $3.06, exceeding analyst predictions of $2.71 and showing a 60% year-on-year increase. The net income rose 14% to $2.9 billion, up from $2.5 billion.
The company’s stock saw a nearly 5% increase in pre-market trading on Tuesday, reflecting a year-to-date rise of over 37%. Additionally, GM announced a cash dividend for the third quarter, contributing to the stock’s upward momentum.
In a letter addressed to shareholders, CEO Mary Barra emphasized the success of GM’s gasoline-powered trucks and SUVs. She also mentioned the forthcoming launch of eight new or redesigned vehicle models in North America. Barra affirmed GM’s commitment to scaling production of the electric Chevrolet Equinox and expressed enthusiasm about their progress in electric vehicles, despite acknowledging that the company would not meet its goal of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown.
Barra announced that GM’s self-driving unit, Cruise, would abandon its Origin vehicle, which had faced operational setbacks following an incident last October. Instead, Cruise will concentrate on utilizing the next-generation Chevrolet Bolt for testing in Texas and Arizona. GM incurred a $600 million expense related to the halt of Origin production in Detroit.
During a call with analysts, Barra explained that opting for the Bolt would address regulatory concerns regarding the Origin’s unusual design, such as its lack of a steering wheel, while also reducing costs per unit and streamlining resource allocation.
Barra reaffirmed GM’s commitment to transforming mobility through autonomous technology, stating, “Our vision is unchanged, and every mile traveled, and every simulation, brings us closer because Cruise is an AI-first company.”
Additionally, GM is looking to restructure its joint venture with SAIC Motor in China as it continues to experience losses, taking a $104 million loss in the second quarter. Production at SAIC-GM was cut by 70% in June, resulting in deliveries of 26,000 vehicles, which is a 50% decrease compared to the previous year.