General Motors has updated its financial projections for 2024, significantly exceeding Wall Street analysts’ expectations in the second quarter. The company now anticipates adjusted earnings for the year to range between $13 billion and $15 billion, an increase from the previous estimate of $12.5 billion to $14.5 billion. GM also revised its targets for operating cash flow and earnings per share, while slightly lowering expectations for net income attributable to shareholders to a range of $10 billion to $11.4 billion.
In terms of revenue, GM reported $47.9 billion for the second quarter, marking over a 7% increase from the prior year’s figures, and surpassing the Wall Street expectation of $45 billion, according to FactSet estimates. The company’s earnings per share came in at $3.06, exceeding the anticipated $2.71 per share and representing a 60% increase compared to 2023. Net income saw a 14% rise, reaching $2.9 billion, up from $2.5 billion.
In reaction to these results, GM’s stock surged almost 5% in pre-market trading on Tuesday, with an impressive gain of over 37% year-to-date. Following the close of trading on Monday, GM announced a third-quarter cash dividend, further boosting investor confidence.
During a letter to shareholders, CEO Mary Barra emphasized the strong performance of GM’s gas-powered trucks and SUVs, highlighting the launch of eight new or redesigned models in North America. She also mentioned that the company is ramping up production of the electric Chevrolet Equinox, while maintaining a commitment to disciplined volume growth in their electric vehicle (EV) segment.
Barra acknowledged earlier this month that GM would not meet its target of producing 1 million electric vehicles in North America by the end of 2025, attributing this to a slowdown in the market. However, the company’s EV sales had seen growth in the last quarter.
In addition, Barra announced changes for Cruise, GM’s autonomous vehicle unit, which will abandon its Origin vehicle project and will instead focus on the next-generation Chevrolet Bolt for testing in Texas and Arizona. This decision follows a $600 million charge associated with the cessation of the Origin production in Detroit. Barra indicated that using the Bolt would address regulatory concerns related to the unique design of the Origin and would also help in reducing costs and optimizing resources.
She concluded, stating that GM’s commitment to transforming mobility through autonomous technology remains steadfast, with each step forward bringing the company closer to its goals.
Furthermore, GM is working to reshape its joint venture in China with SAIC Motor, as it continues to face losses, reporting a $104 million loss in the second quarter. Earlier, SAIC-GM significantly cut production by 70%, delivering only 26,000 vehicles, which is 50% less than the previous year, according to industry reports.