General Motors has raised several financial projections for 2024 after exceeding Wall Street’s expectations in its second-quarter results. The Detroit-based company now anticipates adjusted earnings between $13 billion and $15 billion, up from a previous estimate of $12.5 billion to $14.5 billion. GM has also increased its targets for operating cash flow and earnings per share, although it slightly lowered the expectations for net income attributable to shareholders to a range of $10 billion to $11.4 billion.
In the second quarter, GM reported revenue of $47.9 billion, representing a more than 7% increase from the previous year, surpassing the expected $45 billion. Earnings per share stood at $3.06, exceeding analysts’ predictions of $2.71, and marking a 60% increase compared to 2023. Net income rose by 14%, reaching $2.9 billion compared to $2.5 billion the year prior.
Following these announcements, GM’s stock price surged nearly 5% in pre-market trading, reflecting a more than 37% gain for the year. After the trading session closed on Monday, GM declared a third-quarter cash dividend, which further buoyed the stock.
In a letter to shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs and mentioned the company’s plans to launch eight new or redesigned models in North America. She emphasized the scaling production of the electric Chevrolet Equinox, stating that while the company is enthusiastic about its electric vehicles (EVs) and their success, it remains committed to disciplined growth.
Barra had previously 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 market slowdown. However, the company’s EV sales did see an increase last quarter, and GM plans to be adaptable to market demands.
Additionally, Barra announced that Cruise, GM’s self-driving unit, would discontinue its Origin vehicle, which had faced operational setbacks after an incident last October. Instead, Cruise will focus on using the next-generation Chevrolet Bolt for testing in Texas and Arizona. GM incurred a $600 million charge related to the halted production of the Origin vehicle.
During a call with analysts, Barra noted that utilizing the Bolt would address regulatory concerns over the Origin’s unconventional design, which lacked a steering wheel. This strategy is expected to reduce per-unit costs and allow better resource optimization.
GM is also working to restructure its joint venture in China with SAIC Motor to mitigate ongoing losses; the company reported a $104 million loss for the second quarter. In June, SAIC-GM significantly reduced production by 70%, delivering 26,000 vehicles, a 50% decrease compared to the previous year.