General Motors (GM) has raised several financial projections for 2024 following its impressive second-quarter performance that exceeded Wall Street expectations.
The automaker increased its forecast for adjusted earnings for the year to between $13 billion and $15 billion, up from a previous estimate of $12.5 billion to $14.5 billion. It also raised expectations for operating cash flow and earnings per share, while slightly lowering the net income forecast attributable to shareholders by less than 1%, now estimated at between $10 billion and $11.4 billion.
For the second quarter, GM reported revenue of $47.9 billion, marking over a 7% increase from the previous year and surpassing Wall Street’s expectation of $45 billion. Earnings per share reached $3.06, exceeding the analyst estimate of $2.71 and representing a 60% increase compared to 2023. Net income rose 14% to $2.9 billion, up from $2.5 billion.
As a result of these strong figures, GM’s stock rose nearly 5% in pre-market trading on Tuesday, with the stock up more than 37% year-to-date. Following market closure on Monday, GM announced a cash dividend for the third quarter, further boosting investor confidence.
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 in North America. Barra also mentioned GM’s scaling production of the electric Chevrolet Equinox, emphasizing the company’s commitment to disciplined growth in electric vehicle production.
Earlier this month, Barra noted that GM may not achieve its goal of producing 1 million electric vehicles in North America by the end of 2025 due to market slowdowns, but the company aims to remain flexible and responsive to demand. Notably, GM’s EV sales did increase last quarter.
Additionally, Barra informed that GM’s self-driving unit, Cruise, will no longer pursue its Origin vehicle following a prior incident that led to a scale-back of its operations. Instead, Cruise will focus on using the next-generation Chevrolet Bolt for its vehicle testing in Texas and Arizona. GM incurred a $600 million charge as a result of halting production of the Origin.
During an analyst call, Barra expressed confidence in Cruise’s mission to revolutionize mobility with autonomous technology, reiterating that each mile and simulation progresses the company towards its goals.
Moreover, GM is reevaluating its joint venture in China with SAIC Motor, as it continues to face losses, including a $104 million loss for the second quarter. In June, SAIC-GM reduced production by 70%, delivering only 26,000 vehicles, which is a 50% decrease compared to the previous year.