General Motors has upgraded its financial targets for 2024 after exceeding Wall Street’s expectations in its second quarter results. The Detroit-based automaker has revised its anticipated adjusted earnings for the year to a range of $13 billion to $15 billion, an increase from the previous estimate of $12.5 billion to $14.5 billion. It has also raised its forecasts for operating cash flow and earnings per share, while slightly reducing the 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, reflecting a more than 7% increase compared to the same period last year and surpassing Wall Street’s expectation of $45 billion, as per FactSet estimates. Earnings per share reached $3.06, exceeding analysts’ predictions of $2.71 and showing a 60% increase from 2023. Net income rose 14% to $2.9 billion, up from $2.5 billion.
Following these announcements, GM’s stock experienced a nearly 5% increase in pre-market trading, and it has risen over 37% this year. Additionally, after the market closed on Monday, GM declared a third-quarter cash dividend, positively impacting the stock’s performance.
In a communication with shareholders, CEO Mary Barra highlighted the success of the company’s gas-powered trucks and SUVs. She mentioned that GM is preparing to launch eight new or redesigned models across various sizes in North America. Barra emphasized the company’s commitment to increasing production of the electric Chevrolet Equinox but acknowledged that GM would not meet its goal of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown. However, she noted that EV sales did see growth last quarter.
Barra also revealed that GM’s self-driving unit, Cruise, will abandon its Origin vehicle in favor of using the next-generation Chevrolet Bolt for testing in Texas and Arizona. This decision follows a previous incident that led to a rollback of Cruise’s operations last October. GM incurred a $600 million charge related to halting production of the Origin in Detroit. Barra explained that utilizing the Bolt would address regulatory concerns regarding the Origin’s unconventional design and help reduce unit costs.
Moreover, GM is working to restructure its joint venture in China with SAIC Motor as it continues to face financial losses, reporting a $104 million loss for the second quarter. In June, production at SAIC-GM was cut by 70%, resulting in the delivery of 26,000 vehicles, a decrease of 50% compared to the same period last year.