General Motors has announced an increase in several financial targets for 2024, following a strong performance that exceeded Wall Street expectations for its second quarter.
The automaker raised its forecast for adjusted earnings this year to a range of $13 billion to $15 billion, up from the previous estimate of $12.5 billion to $14.5 billion. Additionally, GM has enhanced its targets for operating cash flow and earnings per share. Meanwhile, the expectation for net income attributable to shareholders has been slightly lowered, now projected to be between $10 billion and $11.4 billion, a decrease of less than 1%.
In the second quarter, GM reported revenue of $47.9 billion, marking an increase of more than 7% from the same period last year and surpassing the Wall Street estimate of $45 billion, according to FactSet. The company’s earnings per share reached $3.06, exceeding the anticipated $2.71 and reflecting a 60% increase compared to 2023. Net income also saw a 14% rise, climbing to $2.9 billion from $2.5 billion.
As a result of this strong performance, GM’s stock rose nearly 5% in pre-market trading on Tuesday, further appreciating more than 37% throughout the year. Following the market close on Monday, GM announced a cash dividend for the third quarter, contributing to the positive stock momentum.
In a letter to shareholders, CEO Mary Barra emphasized the success of GM’s gas-powered trucks and SUVs, while revealing plans to launch eight new or redesigned models in various sizes across North America. Barra highlighted the ramp-up of production for the electric Chevrolet Equinox, expressing excitement about their electric vehicle (EV) initiatives while stressing a commitment to disciplined growth.
Earlier this month, Barra 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, the company remains flexible, stating it will “build to demand,” even as EV sales experienced growth last quarter.
Barra also communicated changes regarding Cruise, GM’s self-driving unit, which had to pause operations following an incident last October. The unit will move away from its Origin vehicle and instead focus on next-generation Chevrolet Bolt for testing in Texas and Arizona, which is expected to reduce production costs and address regulatory concerns about the original design.
“Our vision to transform mobility using autonomous technology is unchanged,” Barra stated, adding that each mile traveled and simulation brings them closer to their goals as Cruise continues to lead with AI-driven solutions.
Additionally, GM is seeking to restructure its joint venture in China with SAIC Motor amid ongoing losses, reporting a $104 million loss for the second quarter. In June, production was cut by 70%, resulting in the delivery of 26,000 vehicles, representing a decline of 50% compared to the previous year.