General Motors has adjusted its financial outlook for 2024 following a strong performance that exceeded Wall Street’s predictions for the second quarter.
The automaker has raised its expected adjusted earnings for the year to a range of $13 billion to $15 billion, up from the previous estimate of $12.5 billion to $14.5 billion. Additionally, GM has increased its targets for operating cash flow and earnings per share. The outlook for net income attributable to shareholders saw a slight decrease of less than 1%, now estimated between $10 billion and $11.4 billion.
During the second quarter, GM reported revenue of $47.9 billion, reflecting a more than 7% increase from the previous year and surpassing the $45 billion forecast by analysts at FactSet. Earnings per share came in at $3.06, exceeding the anticipated $2.71 and demonstrating a 60% increase compared to 2023. Net income rose 14% to $2.9 billion, up from $2.5 billion last year.
Following these announcements, GM’s stock rose nearly 5% in pre-market trading on Tuesday, bringing the total increase in stock value to over 37% for the year. The company also declared a third-quarter cash dividend, further boosting investor confidence.
In a letter to shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs, mentioning the launch of eight new or redesigned models in North America. She emphasized the company’s commitment to disciplined production growth for their electric Chevrolet Equinox, despite acknowledging that GM will not meet its goal of producing one million electric vehicles in North America by the end of 2025 due to a market slowdown. However, EV sales did see growth last quarter.
Barra also shared updates regarding Cruise, GM’s self-driving unit, which has shifted its focus away from its Origin vehicle following a pause in operations due to a previous incident. Instead, Cruise will utilize the next-generation Chevrolet Bolt for testing in Texas and Arizona. GM faced a $600 million charge related to the suspension of the Origin’s production in Detroit.
In a call with analysts, Barra noted that using the Bolt would address regulatory concerns regarding the original vehicle’s unique design, such as the absence of a steering wheel. This shift is expected to lower costs per unit and optimize resource allocation.
Despite ongoing challenges, Barra affirmed GM’s vision of transforming mobility through autonomous technology, highlighting the importance of every mile and simulation as they work toward that goal.
Moreover, GM is working to restructure its joint venture in China with SAIC Motor as it grapples with financial losses, reporting a $104 million loss for the second quarter. Production cuts were significant, with SAIC-GM reducing output by 70% in June and delivering only 26,000 vehicles—50% fewer than the same period last year.