General Motors is revising its financial targets for 2024 upwards following impressive second-quarter results that exceeded Wall Street’s expectations. The automaker has increased its projected adjusted earnings for the year to a range of $13 billion to $15 billion, up from $12.5 billion to $14.5 billion. Additionally, GM has raised its targets for operating cash flow and earnings per share, while slightly adjusting its net income forecast for shareholders to between $10 billion and $11.4 billion, marking a decrease of less than 1%.
For the second quarter, GM reported revenue of $47.9 billion, reflecting a more than 7% year-over-year increase and surpassing the expected $45 billion. Earnings per share stood at $3.06, exceeding the anticipated $2.71 and representing a 60% increase compared to 2023. Net income also rose by 14%, amounting to $2.9 billion, compared to $2.5 billion in the same period last year.
As a result, GM’s stock jumped nearly 5% in pre-market trading on Tuesday, with the share price increasing more than 37% this year. Following the market close on Monday, GM announced a cash dividend for the third quarter, contributing to the stock’s positive momentum.
In a letter to shareholders, CEO Mary Barra highlighted the strong performance of the company’s gas-powered trucks and SUVs. She mentioned the launch of eight new or redesigned vehicles in North America, including compact, mid-size, and full-size models. Barra also remarked on the production scaling of the electric Chevrolet Equinox, emphasizing GM’s commitment to controlled growth in electric vehicle (EV) output despite earlier statements that the company would not meet its target of producing 1 million EVs in North America by the end of 2025 due to market challenges. Nevertheless, EV sales did experience growth in the previous quarter.
Barra also announced that GM’s self-driving unit, Cruise, will abandon its plans for the Origin vehicle, which had its operations scaled back following an incident last October. Instead, Cruise will concentrate on utilizing the next-generation Chevrolet Bolt for vehicle testing in Texas and Arizona. The company incurred a $600 million charge linked to the halt in Origin production in Detroit.
During a call with analysts, Barra noted that employing the Bolt would address regulatory concerns regarding the Origin’s unconventional design, which notably lacked a steering wheel. She also pointed out that this shift would help reduce per-unit costs and allow GM to optimize its resources.
Barra reaffirmed GM’s commitment to revolutionizing mobility through autonomous technology, stating that each mile and simulation drives them closer to their vision, as Cruise operates with an AI-first approach.
Additionally, GM is working to restructure its joint venture in China with SAIC Motor as it faces ongoing losses; the company reported a $104 million loss for the second quarter. In June, SAIC-GM significantly cut production by 70%, resulting in only 26,000 vehicle deliveries, which is a 50% decrease compared to the previous year.