General Motors has updated its financial projections for 2024 following a successful second quarter that exceeded Wall Street predictions. The company has adjusted its expected adjusted earnings for the year to a range between $13 billion and $15 billion, an increase from the previous estimate of $12.5 billion to $14.5 billion. GM also raised its targets for operating cash flow and earnings per share, while slightly lowering its expectations for net income attributable to shareholders to between $10 billion and $11.4 billion.
In terms of performance, GM reported second-quarter revenue of $47.9 billion, representing over a 7% rise compared to the same period last year and surpassing the anticipated $45 billion, according to FactSet estimates. Earnings per share stood at $3.06, exceeding the expected $2.71, and marking a 60% increase from the previous year. Net income rose 14%, reaching $2.9 billion, up from $2.5 billion.
As a result of the positive financial news, GM’s stock surged nearly 5% in pre-market trading on Tuesday and has seen a more than 37% increase year-to-date. The company announced a third-quarter cash dividend following the close of trading on Monday, contributing to the stock’s upward momentum.
In her letter to shareholders, CEO Mary Barra highlighted the strong performance of GM’s gas-powered trucks and SUVs. She mentioned that the company is set to launch eight new or redesigned compact, mid-size, and full-size models in North America. Barra also emphasized the scaling production of the electric Chevrolet Equinox, noting GM’s commitment to “disciplined volume growth” despite expressing earlier concerns about meeting the electric vehicle production goal of 1 million units in North America by the end of 2025 due to a market slowdown.
Additionally, Barra announced changes to GM’s self-driving unit, Cruise, stating that it would discontinue the Origin vehicle and instead focus on the next-generation Chevrolet Bolt for testing in Texas and Arizona. The shift comes after a $600 million charge associated with the halted production of the Origin in Detroit. Barra stated that using the Bolt will lessen regulatory concerns regarding the Origin’s innovative design and will help reduce costs while optimizing resources.
“Our vision to transform mobility using autonomous technology is unchanged, and every mile traveled, and every simulation brings us closer because Cruise is an AI-first company,” Barra affirmed.
Moreover, GM is looking to restructure its joint venture with SAIC Motor in China as it continues to face losses, reporting a $104 million loss in the second quarter. In June, SAIC-GM cut production by 70%, delivering only 26,000 vehicles, which represents a 50% decrease compared to the same period last year, according to Automotive News.