General Motors has increased several financial targets for 2024 after exceeding Wall Street expectations for its second quarter. The Detroit-based automaker has raised its anticipated adjusted earnings for the year to a range of $13 billion to $15 billion, up from a previous estimate of $12.5 billion to $14.5 billion. It also adjusted 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 revenues of $47.9 billion, marking a more than 7% increase from the previous year, and surpassing the $45 billion forecast by analysts according to FactSet estimates. The earnings per share reached $3.06, exceeding the expected $2.71, and representing a 60% increase from 2023. The company’s net income rose by 14%, totaling $2.9 billion, compared to $2.5 billion the prior year.
Following these announcements, GM’s stock surged nearly 5% in pre-market trading, continuing a trend that has seen shares increase over 37% this year. Recently, GM declared a third-quarter cash dividend, which further boosted investor confidence.
In a letter addressed to shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs and revealed plans for the launch of eight new or redesigned models across various segments in North America. She emphasized the scaling production of the electric Chevrolet Equinox and reiterated GM’s commitment to measured growth in electric vehicle (EV) production, despite acknowledging earlier this month that the company will not meet its target of producing 1 million EVs in North America by the end of 2025 due to a market slowdown.
Barra also shared that GM’s self-driving unit, Cruise, would abandon its plans for the Origin vehicle, which faced operational setbacks after an incident last October. Instead, Cruise will refocus its efforts on the next-generation Chevrolet Bolt as it continues testing in Texas and Arizona. GM has incurred a $600 million expense associated with halting production of the Origin in Detroit.
During discussions with analysts, Barra noted that utilizing the Bolt would address regulatory concerns surrounding the Origin’s unconventional design, which lacked a steering wheel. This shift is expected to reduce costs and allow GM to optimize its resources.
“Our vision to transform mobility using autonomous technology remains strong, and each mile traveled and every simulation brings us closer,” Barra affirmed, emphasizing Cruise’s identity as an AI-first company.
Additionally, GM is seeking to restructure its joint venture with SAIC Motor in China, where it reported a $104 million loss for the second quarter. In June, SAIC-GM significantly reduced production by 70%, delivering only 26,000 vehicles, which is a 50% decline from the previous year, according to Automotive News.