General Motors has raised several financial targets for 2024 after exceeding Wall Street’s expectations in its second-quarter results. The Detroit-based automaker has increased its forecast for adjusted earnings this year to a range of $13 billion to $15 billion, up from a previous range of $12.5 billion to $14.5 billion. Additionally, GM has adjusted its targets 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.
The company’s revenue for the second quarter reached $47.9 billion, marking a more than 7% increase compared to the same period last year and surpassing Wall Street’s anticipated $45 billion, according to FactSet estimates. Earnings per share stood at $3.06, exceeding the analysts’ expectation of $2.71 per share and representing a 60% increase year-over-year. GM’s net income also rose by 14% to $2.9 billion, up from $2.5 billion.
Following these announcements, GM’s stock rose nearly 5% in pre-market trading, and the stock has increased more than 37% this year. The automaker also declared a cash dividend for the third quarter, further boosting its stock’s performance.
In a letter to shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs, and mentioned that the company is in the process of launching eight new or redesigned models of compact, mid-size, and full-size vehicles in North America. Barra emphasized GM’s commitment to disciplined volume growth as it ramp-ups production of the electric Chevrolet Equinox, expressing excitement about early successes in electric vehicles (EVs), although she acknowledged a market slowdown would affect GM’s goal of producing 1 million electric vehicles in North America by the end of 2025.
Barra also addressed the status of Cruise, GM’s self-driving unit, which recently scaled back its operations after an incident last October. The company has decided to move away from its Origin vehicle in favor of testing its next-generation Chevrolet Bolt in Texas and Arizona. GM has taken a $600 million charge connected to the discontinuation of the Origin’s production in Detroit. During a call with analysts, Barra explained that using the Bolt would alleviate regulatory concerns regarding the Origin’s unconventional design, such as its lack of a steering wheel, while also reducing costs and optimizing resources.
Additionally, GM is working to restructure its joint venture in China with SAIC Motor, as it continues to face losses, with a reported $104 million loss in the second quarter. Earlier this year, SAIC-GM reduced production by 70% and delivered 26,000 vehicles, which is 50% less than the previous year.