General Motors has raised several financial goals for 2024 after exceeding Wall Street’s expectations for its second quarter. The Detroit-based automaker now anticipates adjusted earnings for the year to fall between $13 billion and $15 billion, an increase from the previous range of $12.5 billion to $14.5 billion. Additionally, GM raised its targets for operating cash flow and earnings per share, while slightly decreasing expectations for net income attributable to shareholders to between $10 billion and $11.4 billion.
In the second quarter, GM reported revenue of $47.9 billion, representing a more than 7% increase year-over-year and surpassing Wall Street’s expectation of $45 billion. Earnings per share reached $3.06, exceeding the anticipated $2.71, and marking a 60% increase compared to 2023. Net income rose 14% to $2.9 billion from $2.5 billion in the same period last year.
Following the announcement, GM’s stock surged nearly 5% in pre-market trading on Tuesday, bringing its yearly gain to over 37%. After trading ended on Monday, GM also announced a cash dividend for the third quarter, contributing to the stock’s upward momentum.
In a letter to shareholders, CEO Mary Barra highlighted the success of the company’s gas-powered trucks and SUVs, and announced plans to launch eight new or redesigned models across compact, mid-size, and full-size segments in North America. Barra also mentioned the ramp-up in production of the electric Chevrolet Equinox, emphasizing GM’s commitment to disciplined growth despite excitement surrounding its electric vehicles (EVs). However, she noted that GM is unlikely to meet its target of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown.
Additionally, Barra revealed that Cruise, GM’s self-driving division, will abandon its Origin vehicle in favor of utilizing the next-generation Chevrolet Bolt for testing in Texas and Arizona. This decision comes after Cruise had to scale back operations following an incident last October, and GM incurred a $600 million charge related to halting Origin production in Detroit. Barra explained that using the Bolt would address regulatory concerns regarding the Origin’s unconventional design while also reducing costs and optimizing resources.
“Our vision to transform mobility using autonomous technology remains steadfast, and every mile traveled brings us closer to achieving that goal,” Barra stated.
Furthermore, GM is in the process of restructuring its joint venture with SAIC Motor in China as it faces ongoing losses; the company reported a $104 million loss for the second quarter. Earlier in June, SAIC-GM reduced production by 70%, leading to only 26,000 vehicle deliveries, a decrease of 50% compared to the previous year.