General Motors has revised its financial forecasts for 2024 following a strong performance in its second quarter, exceeding Wall Street’s expectations.
The Detroit-based automaker has adjusted its projected adjusted earnings for the year to between $13 billion and $15 billion, an increase from the previous range of $12.5 billion to $14.5 billion. Additionally, GM raised its targets for operating cash flow and earnings per share. Although the expectations for net income attributable to shareholders have been slightly lowered by less than 1%, it now stands at between $10 billion and $11.4 billion.
For the second quarter, GM reported revenue of $47.9 billion, marking a more than 7% increase from the same period last year and surpassing the anticipated $45 billion projected by Wall Street, according to FactSet estimates. The company’s earnings per share reached $3.06, exceeding the $2.71 per share forecasted by analysts and reflecting a 60% increase compared to 2023. Net income rose by 14% to $2.9 billion, up from $2.5 billion.
Following these announcements, GM’s stock surged nearly 5% in pre-market trading on Tuesday, having already soared over 37% this year. Additionally, GM declared a third-quarter cash dividend after the market closed on Monday, further boosting its stock value.
In her letter to shareholders, CEO Mary Barra highlighted the success of the company’s gas-powered trucks and SUVs. She announced that GM is preparing to launch eight new or redesigned models across compact, mid-size, and full-size categories in North America. Barra also mentioned the ramp-up in production of the electric Chevrolet Equinox, emphasizing a commitment to “disciplined volume growth” amid excitement surrounding EVs.
Earlier this month, Barra indicated that GM would 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. The company plans to be adaptable and “build to demand,” although it reported growth in EV sales last quarter.
In a significant shift, Barra revealed that Cruise, GM’s self-driving division, would discontinue its Origin vehicle, refocusing efforts on deploying the next-generation Chevrolet Bolt for testing in Texas and Arizona. This decision followed a $600 million charge linked to the halt of Origin production in Detroit.
During a call with analysts, Barra stated that this change aims to address regulatory concerns regarding the Origin’s design, such as its lack of a steering wheel. She also noted that this approach would help reduce costs and optimize resources.
“Our vision to transform mobility using autonomous technology remains intact, and every mile traveled and simulation brings us closer because Cruise is an AI-first company,” Barra explained.
Additionally, GM is working to restructure its joint venture with SAIC Motor in China, as it continues to face losses, reporting a $104 million loss for the second quarter. Earlier, SAIC-GM reduced production by 70% in June, delivering only 26,000 vehicles, which is a 50% decrease compared to the prior year, as reported by Automotive News.