General Motors has increased its financial projections for 2024 after exceeding analysts’ expectations in the second quarter. The Detroit-based automaker has raised its expected adjusted earnings for the year to between $13 billion and $15 billion, up from a previous range of $12.5 billion to $14.5 billion. Additionally, GM has revised its targets for operating cash flow and earnings per share, while slightly lowering its expectations for net income attributable to shareholders to a range of $10 billion to $11.4 billion.
In the second quarter, GM reported revenue of $47.9 billion, representing a more than 7% increase from the previous year and surpassing Wall Street’s expectations of $45 billion, as per FactSet estimates. The company’s earnings per share were $3.06, significantly higher than the anticipated $2.71 and a 60% increase compared to 2023. Net income 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 on Tuesday and has seen an increase of over 37% this year. The company declared a third-quarter cash dividend after Monday’s market close, further boosting its stock performance.
In a letter to shareholders, CEO Mary Barra highlighted the strong performance of GM’s gasoline-powered trucks and SUVs and revealed plans to launch eight new or redesigned models in North America. She also mentioned the scaling of production for the electric Chevrolet Equinox, emphasizing the company’s commitment to disciplined volume growth despite earlier stating 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.
Furthermore, Barra announced that Cruise, GM’s self-driving unit, would abandon its Origin vehicle project and instead focus on the next-generation Chevrolet Bolt for testing in Texas and Arizona. This pivot comes after a $600 million charge linked to halting the production of the Origin.
In response to regulatory concerns over the unique design of the Origin, which lacked a steering wheel, Barra noted that utilizing the Bolt would address these issues while also helping to reduce costs and optimize resources.
GM is also working to restructure its joint venture with SAIC Motor in China, having incurred a $104 million loss in the second quarter. In June, SAIC-GM significantly cut production by 70%, delivering only 26,000 vehicles, which is 50% less than the previous year.