General Motors has revised its financial targets for 2024 after exceeding Wall Street’s expectations for the second quarter. The automaker has increased its projected adjusted earnings to a range of $13 billion to $15 billion, up from the previous estimate of $12.5 billion to $14.5 billion. It has also raised expectations for operating cash flow and earnings per share, while slightly lowering expectations for net income attributable to shareholders to between $10 billion and $11.4 billion.
Revenue for the second quarter reached $47.9 billion, marking over a 7% increase from the prior year and surpassing the anticipated $45 billion. Earnings per share were reported at $3.06, beating the analysts’ expectation of $2.71 and representing a 60% increase compared to 2023. Net income rose by 14%, totaling $2.9 billion, up from $2.5 billion.
Following this news, GM’s stock rose nearly 5% in pre-market trading on Tuesday, contributing to a more than 37% increase in stock value this year. Additionally, GM announced a third-quarter cash dividend after market close on Monday, further boosting investor confidence.
In a letter to shareholders, CEO Mary Barra highlighted the strong performance of the company’s gas-powered trucks and SUVs and mentioned the upcoming launch of eight new or redesigned vehicle models in North America. She emphasized GM’s commitment to scaling production of the electric Chevrolet Equinox, reassuring stakeholders about the company’s disciplined approach to volume growth despite previous admissions that it would not meet its goal of producing 1 million electric vehicles in North America by the end of 2025 due to market slowdowns.
Barra also announced strategic changes for Cruise, GM’s self-driving unit. The company will discontinue the Origin vehicle and instead utilize the next-generation Chevrolet Bolt for testing in Texas and Arizona, following a rollback in operations after an incident last October. GM incurred a $600 million charge associated with halting production of the Origin.
During a call with analysts, Barra noted that transitioning to the Bolt would alleviate regulatory concerns regarding the Origin’s unconventional design. She stated that this decision will also reduce costs and improve resource allocation.
Barra reinforced GM’s commitment to transforming mobility through autonomous technology, asserting that every mile and simulation brings the company closer to its goals. Additionally, GM is working to restructure its joint venture with SAIC Motor in China due to ongoing losses, reporting a $104 million loss for the second quarter. In June, SAIC-GM reduced production by 70%, delivering 26,000 vehicles, which is 50% less than the previous year.