General Motors has increased several financial forecasts for 2024 following a strong performance in the second quarter that exceeded Wall Street predictions. The Detroit-based automaker has adjusted its expected adjusted earnings for the year to range from $13 billion to $15 billion, up from the previous estimate of $12.5 billion to $14.5 billion. Additionally, GM raised its targets for operating cash flow and earnings per share, although the forecast for net income attributable to shareholders has been slightly reduced to between $10 billion and $11.4 billion.
In its latest report, GM revealed that revenue for the second quarter reached $47.9 billion, marking an increase of over 7% compared to the same period last year, and surpassing Wall Street’s expectation of $45 billion, based on FactSet estimates. Earnings per share stood at $3.06, exceeding analysts’ predictions of $2.71, and demonstrating a 60% increase from 2023. Net income for the quarter rose by 14%, reaching $2.9 billion, up from $2.5 billion.
Following these results, GM’s stock surged almost 5% in pre-market trading on Tuesday, bringing its gains for the year to over 37%. After the market closed on Monday, GM announced a cash dividend for the third quarter, contributing to the stock’s upward momentum.
In a letter to shareholders, CEO Mary Barra highlighted the strong performance of the company’s gasoline-powered trucks and SUVs. She mentioned that GM is in the process of launching eight new or redesigned vehicle models in North America. Barra also pointed out the ramping up of production for the electric Chevrolet Equinox, affirming the company’s commitment to disciplined growth in electric vehicle production despite earlier indications that they would not meet their target of producing 1 million electric vehicles in North America by the end of 2025 due to a slowdown in the market.
Additionally, Barra disclosed that Cruise, GM’s self-driving division, has decided to abandon its Origin vehicle project, which faced regulatory scrutiny after an incident last October. Instead, Cruise will concentrate on utilizing the next-generation Chevrolet Bolt during testing in Texas and Arizona, which will also help reduce production costs related to the halted Origin project.
Barra assured stakeholders that GM’s vision to enhance mobility through autonomous technology remains steadfast, with every trial and simulation contributing to their progress as an AI-driven company.
Moreover, GM is pursuing a restructuring of its joint venture with SAIC Motor in China, where it continues to face financial losses, having reported a $104 million loss in the second quarter. Earlier in June, SAIC-GM significantly reduced its production by 70%, resulting in the delivery of only 26,000 vehicles, a 50% decrease compared to the previous year.