General Motors has adjusted its financial projections for 2024 following a strong second quarter that exceeded Wall Street forecasts. The Detroit-based automaker has raised its anticipated adjusted earnings for the year to a range of $13 billion to $15 billion, improving from an earlier estimate of $12.5 billion to $14.5 billion. Additionally, GM has increased its targets for operating cash flow and earnings per share, while slightly reducing expectations for net income attributable to shareholders to between $10 billion and $11.4 billion.
In its second-quarter results, GM recorded a revenue of $47.9 billion, up more than 7% from the previous year and surpassing Wall Street’s prediction of $45 billion, based on FactSet estimates. Earnings per share reached $3.06, exceeding analysts’ expectations of $2.71 and reflecting a 60% increase compared to 2023. Net income rose by 14% to $2.9 billion, an increase from $2.5 billion.
Following the earnings release, GM’s stock surged nearly 5% in pre-market trading, contributing to an overall rise of more than 37% this year. After market close 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 GM’s gasoline-powered trucks and SUVs, mentioning plans to launch eight new or redesigned models in North America. She emphasized the scaling production of the electric Chevrolet Equinox and expressed the company’s commitment to disciplined growth in electric vehicle (EV) production. Although Barra acknowledged that GM would not meet its goal of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown, she noted that EV sales did show growth last quarter.
Barra also revealed that Cruise, GM’s autonomous driving unit, has decided to discontinue its Origin vehicle project after having limited operations last October. Instead, Cruise will focus on using the next-generation Chevrolet Bolt for testing in Texas and Arizona. GM incurred a $600 million charge related to the suspension of production for the Origin in Detroit.
During a call with analysts, Barra indicated that utilizing the Bolt would address regulatory concerns regarding the Origin’s unconventional design and would help reduce costs and optimize resources.
“Our vision to transform mobility using autonomous technology remains unchanged, and each mile driven and simulation performed advances this goal, as Cruise operates as an AI-first company,” Barra stated.
Additionally, GM is working on restructuring its joint venture in China with SAIC Motor, as it continues to experience losses, including a $104 million loss reported for the second quarter. In June, SAIC-GM significantly reduced production by 70% and delivered only 26,000 vehicles, reflecting a 50% decline compared to the previous year.