General Motors has revised its financial targets for 2024, following strong second-quarter results that exceeded Wall Street’s expectations. The Detroit-based automaker has raised its projected adjusted earnings for the year to a range of $13 billion to $15 billion, an increase from the previous forecast of $12.5 billion to $14.5 billion. Additionally, GM has enhanced its targets for operating cash flow and earnings per share, while slightly adjusting expectations for net income attributable to shareholders down 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, marking a more than 7% increase compared to the same period last year and surpassing Wall Street’s expectation of $45 billion. The company’s earnings per share reached $3.06, exceeding the anticipated $2.71, and demonstrating a 60% increase over 2023. Net income grew 14% to $2.9 billion, compared to $2.5 billion from the previous year.
In pre-market trading on Tuesday, GM’s stock rose nearly 5%, continuing a trend that has seen a 37% increase since the start of the year. The company announced a cash dividend for the third quarter after market close on Monday, further boosting investor confidence.
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 across various sizes in North America. Barra emphasized GM’s commitment to scaling production of the electric Chevrolet Equinox, stating that while the company is enthusiastic about its electric vehicles (EVs) and early achievements, it remains focused on disciplined growth.
Earlier in the month, Barra acknowledged that GM would not achieve its goal of producing 1 million electric vehicles in North America by the end of 2025, citing a slowdown in the market. The company plans to be flexible and “build to demand,” although it reported a rise in EV sales in the last quarter.
Barra also announced changes to GM’s self-driving unit, Cruise, which will cease production of the Origin vehicle following setbacks last October. Instead, the focus will shift to 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.
During a conference call, Barra explained that using the Bolt would address regulatory concerns regarding the Origin’s unconventional design, such as the absence of a steering wheel. This transition is expected to reduce costs per unit and optimize resources for GM.
Lastly, GM is working to restructure its joint venture in China with SAIC Motor, as it grapples with losses, including a $104 million loss in the second quarter. In June, production was cut by 70% at SAIC-GM, which resulted in the delivery of only 26,000 vehicles, representing a 50% decline compared to the previous year.