General Motors has announced an increase in several financial targets for 2024 after exceeding Wall Street’s expectations for its second quarter performance. The automaker revised its expected adjusted earnings for the year to a range of $13 billion to $15 billion, up from the previous forecast of $12.5 billion to $14.5 billion. Additionally, GM raised its targets for operating cash flow and earnings per share, while slightly lowering its expectations for net income attributable to shareholders to between $10 billion and $11.4 billion, a decrease of less than 1%.
For the second quarter, GM reported revenue of $47.9 billion, representing a over 7% increase from the same period last year and surpassing the $45 billion anticipated by analysts, according to FactSet estimates. The company’s earnings per share stood at $3.06, exceeding the expected $2.71 and showing a 60% increase compared to 2023. Net income rose 14% to $2.9 billion, up from $2.5 billion.
Following the financial news, GM’s stock saw an increase of nearly 5% in pre-market trading on Tuesday and has grown more than 37% this year. GM also declared a third-quarter cash dividend after Monday’s trading closed, further boosting its stock.
In a letter to shareholders, CEO Mary Barra highlighted the strong performance of the company’s gas-powered trucks and SUVs, mentioning that GM is preparing to launch eight new or redesigned models in North America. She stated that GM is ramping up production of the electric Chevrolet Equinox, emphasizing that while the company is excited about its electric vehicles and early successes, it remains committed to disciplined growth.
Earlier this month, Barra noted that GM would not meet its target of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown. The company intends to be flexible and “build to demand,” though it did see an increase in EV sales last quarter.
Barra also revealed that Cruise, GM’s self-driving unit, would discontinue its Origin vehicle following a need to rein in operations after an incident last October. The focus will shift to utilizing the next-generation Chevrolet Bolt for vehicle testing in Texas and Arizona. GM reported a $600 million charge related to the stoppage of Origin production in Detroit.
During a call with analysts, Barra expressed that using the Bolt addresses regulatory concerns regarding the Origin’s distinctive design, such as its absence of a steering wheel. She added that this adjustment would reduce costs per unit and allow GM to better allocate resources.
In addition, GM is working on restructuring its joint venture in China with SAIC Motor, as it faces ongoing losses, including a $104 million loss in the second quarter. In June, SAIC-GM cut production by 70%, delivering 26,000 vehicles, which is a 50% decrease compared to the same period last year.