General Motors has adjusted several financial targets for 2024 after exceeding Wall Street’s expectations in the second quarter. The Detroit-based automaker has revised its anticipated adjusted earnings for the year to a range of $13 billion to $15 billion, an increase from the previous estimate of $12.5 billion to $14.5 billion. Additionally, GM has raised its targets for operating cash flow and earnings per share, though the net income expected for shareholders has been slightly reduced by less than 1%, now estimated to be between $10 billion and $11.4 billion.
In the second quarter, GM reported revenues of $47.9 billion, marking a more than 7% increase compared to the same period last year and surpassing Wall Street’s expectation of $45 billion, according to FactSet. Earnings per share reached $3.06, exceeding the anticipated $2.71 and representing a 60% increase compared to 2023. The company’s net income rose by 14%, reaching $2.9 billion, up from $2.5 billion.
As a result of these strong numbers, GM’s stock price increased nearly 5% in pre-market trading on Tuesday, with the stock up over 37% for the year. After the trading day on Monday, GM also announced a cash dividend for the third quarter, contributing to a rise in stock value.
In a letter to shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs, mentioning the upcoming launch of eight new or redesigned models in the North American market. She emphasized that GM is ramping up production of the electric Chevrolet Equinox and reiterated the company’s commitment to disciplined growth in the electric vehicle sector.
However, Barra noted earlier this month that GM would not meet its target of producing 1 million electric vehicles in North America by the end of 2025 due to a slowdown in the market. The company is adopting a flexible approach to production, stating it would “build to demand,” although EV sales did see an increase last quarter.
Additionally, Barra announced changes to Cruise, GM’s self-driving division, which has reduced its operations after a prior incident. The company will discontinue the Origin vehicle and instead employ the next-generation Chevrolet Bolt for testing in Texas and Arizona. GM incurred a $600 million charge related to the halt in production of the Origin vehicle in Detroit.
During an analyst call, Barra expressed that utilizing the Bolt would address regulatory concerns associated with the unique design of the Origin, which lacked a traditional steering wheel. This shift is expected to reduce costs per unit and enhance resource allocation.
GM is also working on restructuring its joint venture in China with SAIC Motor, as the company has faced ongoing losses, including a reported $104 million loss in the second quarter. In June, SAIC-GM significantly reduced production by 70%, delivering 26,000 vehicles—representing a 50% decline from the previous year.