General Motors has updated its financial projections for 2024 after significantly exceeding Wall Street’s expectations in its second quarter results.
The automaker has boosted its estimated adjusted earnings for the year to a range of $13 billion to $15 billion, an increase from the previous estimate of $12.5 billion to $14.5 billion. Additionally, GM has raised 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.
GM reported revenue of $47.9 billion for the second quarter, marking over a 7% increase from the previous year and surpassing the anticipated $45 billion based on FactSet estimates. Earnings per share reached $3.06, exceeding the expected $2.71 and representing a 60% increase compared to 2023. Net income rose by 14% to $2.9 billion, compared to $2.5 billion the previous year.
In pre-market trading on Tuesday, GM’s stock surged nearly 5%. The stock has increased over 37% since the beginning of the year. Following Monday’s market close, GM announced a third-quarter cash dividend, contributing to the stock’s rise.
In her letter to shareholders, CEO Mary Barra highlighted the success of the company’s gas-powered trucks and SUVs, and mentioned that GM is set to launch eight new or redesigned models in North America across compact, mid-size, and full-size segments. Barra emphasized the scaling of production for the electric Chevrolet Equinox, expressing excitement about GM’s early successes in the electric vehicle sector while also advocating for disciplined growth.
Earlier this month, Barra indicated that GM would not meet its target of producing 1 million electric vehicles in North America by the end of 2025, attributing this to a slowing market. The company plans to be adaptable and “build to demand,” although it did see an increase in EV sales during the last quarter.
Barra also announced that Cruise, GM’s autonomous driving division, would discontinue its Origin vehicle, which faced operational setbacks following an incident last October. Instead, Cruise will concentrate on utilizing the next-generation Chevrolet Bolt for testing in Texas and Arizona. GM incurred a $600 million charge due to the suspension of Origin production in Detroit.
During a conference call with analysts, Barra remarked that using the Bolt would address regulatory concerns regarding the Origin’s distinctive design, such as its absence of a steering wheel. This shift is expected to lower production costs and allow GM to better allocate resources.
“Our vision to transform mobility using autonomous technology remains steadfast, and with every mile traveled and every simulation, we are making progress because Cruise is an AI-first company,” Barra stated.
GM is also in the process of restructuring its joint venture in China with SAIC Motor amid ongoing losses, having reported a $104 million loss for the second quarter. In June, SAIC-GM reduced production by 70%, delivering 26,000 vehicles—50% fewer than a year earlier, according to reports.