General Motors has revised its financial outlook for 2024, raising expectations after exceeding analysts’ estimates for its second quarter performance. The automaker has adjusted its forecast for adjusted earnings up to a range of $13 billion to $15 billion, surpassing the previous range of $12.5 billion to $14.5 billion. It has also increased targets for operating cash flow and earnings per share, while slightly lowering net income projections for shareholders to between $10 billion and $11.4 billion.
In the second quarter, GM reported revenue of $47.9 billion, marking over a 7% increase from the same period last year and surpassing Wall Street’s expectation of $45 billion. Earnings per share stood at $3.06, exceeding the predicted $2.71 and representing a 60% increase compared to 2023. The company also noted a 14% rise in net income, which rose to $2.9 billion from $2.5 billion.
As a response to these positive results, GM’s stock jumped nearly 5% in pre-market trading on Tuesday, with the stock gaining over 37% throughout the year. Following market close on Monday, GM announced a cash dividend for the third quarter, further boosting investor confidence.
In her letter to shareholders, CEO Mary Barra emphasized the strong performance of GM’s gas-powered trucks and SUVs, announcing plans to launch eight new or redesigned vehicle models across compact, mid-size, and full-size categories in North America. She highlighted the scaling of production for the electric Chevrolet Equinox and reiterated the company’s dedication to maintaining disciplined growth in electric vehicle (EV) production despite a recent projection indicating that GM would not meet its goal of manufacturing 1 million EVs in North America by the end of 2025 due to a market slowdown.
Barra also revealed that Cruise, GM’s autonomous driving unit, would discontinue the production of its Origin vehicle to concentrate on testing the next-generation Chevrolet Bolt in Texas and Arizona. This decision follows a $600 million charge attributed to the halted production of the Origin. Barra stated that utilizing the Bolt would address regulatory concerns regarding the unique design of the Origin and help optimize costs.
In addition to these developments, GM is working to restructure its joint venture with SAIC Motor in China amid ongoing losses, which amounted to $104 million in the second quarter. In June, production was drastically cut by 70%, with only 26,000 vehicles delivered, representing a 50% decrease compared to the previous year.