General Motors (GM) has updated its financial goals for 2024 following a strong performance in its second quarter, surpassing analysts’ expectations. The automaker has increased its projected 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. Additionally, GM has 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 a revenue of $47.9 billion, reflecting a more than 7% increase compared to last year, and outpacing analysts’ predictions of $45 billion. The company achieved earnings per share of $3.06, surpassing the expected $2.71, and representing a 60% increase from 2023. Net income rose 14% to $2.9 billion, up from $2.5 billion.
Following this announcement, GM’s stock saw a nearly 5% increase in pre-market trading on Tuesday, contributing to an impressive year-to-date gain of over 37%. Additionally, GM declared a third-quarter cash dividend, which further boosted investor confidence.
In her letter to shareholders, CEO Mary Barra highlighted the strength of GM’s gas-powered trucks and SUVs and announced plans for the launch of eight new or redesigned models in North America. Barra also addressed the company’s efforts to scale production of the electric Chevrolet Equinox, emphasizing GM’s commitment to disciplined growth in the electric vehicle (EV) sector, despite earlier acknowledging the challenge of meeting their goal of producing 1 million EVs in North America by the end of 2025.
In a strategic pivot, Barra stated that GM’s self-driving unit, Cruise, will discontinue its Origin vehicle and instead utilize the next-generation Chevrolet Bolt for testing in Texas and Arizona. This change comes after production of the Origin was halted following an incident last year. The adjustment aims to address regulatory concerns and reduce costs while continuing GM’s vision of transforming mobility through autonomous technology.
Moreover, GM is working to restructure its joint venture with SAIC Motor in China, as it grapples with financial losses, including a $104 million loss for the second quarter. Production was significantly reduced by 70% earlier in the year, resulting in a drop in vehicle deliveries.
Overall, despite facing some challenges, GM’s financial performance and strategic decisions demonstrate resilience and a commitment to innovation in a rapidly evolving automotive market. This trend of adaptability and growth suggests a promising future not just for GM but for the broader industry as it navigates the transition to electric and autonomous vehicles.
In summary, GM’s strong second-quarter results and ambitious plans for the future reflect its commitment to financial stability and innovation amidst challenges, underscoring a positive outlook for the company as it adapts to changing market dynamics.