General Motors has updated its financial projections for 2024 following a strong performance in the second quarter, surpassing Wall Street expectations. The automaker has raised its anticipated adjusted earnings for the year to between $13 billion and $15 billion, an increase from a previous range of $12.5 billion to $14.5 billion. Operating cash flow and earnings per share targets have also been elevated. However, the forecast for net income attributable to shareholders has been slightly lowered by less than 1%, to a range of $10 billion to $11.4 billion.
In the second quarter, GM reported revenue of $47.9 billion, marking a more than 7% rise compared to the same period last year, and exceeding Wall Street’s expectations of $45 billion. Earnings per share reached $3.06, significantly higher than the $2.71 analysts had predicted and up 60% from 2023. Net income increased by 14%, rising to $2.9 billion from $2.5 billion.
Shares of GM surged nearly 5% in pre-market trading, contributing to a more than 37% gain in the stock price over the year. The company declared a third-quarter cash dividend after the market closed on Monday, enhancing investor confidence.
In her letter to shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs and shared plans to launch eight new or redesigned models in North America. She emphasized the company’s commitment to disciplined growth in electric vehicle production, particularly for the Chevrolet Equinox, despite earlier remarks indicating that GM would not meet its target of producing 1 million electric vehicles in North America by the end of 2025 due to market slowdowns.
Barra also announced a strategic shift for Cruise, GM’s self-driving division, which will discontinue its Origin vehicle and instead utilize the next-generation Chevrolet Bolt for tests in Texas and Arizona. This decision comes after Cruise had to scale back operations following an incident last October, leading to a $600 million charge associated with stopping Origin production in Detroit.
During discussions with analysts, Barra stated that adopting the Bolt would address regulatory concerns regarding the unique design of the Origin, which lacked a steering wheel, while also reducing costs and optimizing resources.
Finally, GM is working on restructuring its joint venture with SAIC Motor in China, amid ongoing losses, reporting a $104 million loss for the second quarter. In June, SAIC-GM reduced its production by 70%, delivering only 26,000 vehicles, down 50% compared to the previous year.