General Motors has increased several financial targets for 2024 after surpassing Wall Street’s expectations in its second quarter results. The company now anticipates adjusted earnings between $13 billion and $15 billion, up from previous estimates of $12.5 billion to $14.5 billion. Additionally, GM has revised its projections for operating cash flow and earnings per share, although it slightly lowered the expected net income attributable to shareholders by less than 1%, now forecasting between $10 billion and $11.4 billion.
In the second quarter, GM reported revenues of $47.9 billion, marking a more than 7% increase compared to the same period last year and exceeding Wall Street’s expectations of $45 billion, according to FactSet data. Earnings per share reached $3.06, significantly higher than the $2.71 analysts had predicted, representing a 60% increase from 2023. Net income rose by 14% to $2.9 billion, compared to $2.5 billion the previous year.
Following the announcement, GM’s stock price surged nearly 5% in pre-market trading and has seen an overall rise of more than 37% this year. The company also declared a third-quarter cash dividend after the market closed on Monday, which contributed to its stock’s upward momentum.
In a letter to shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs, stating that the company plans to launch eight new or redesigned models across compact, mid-size, and full-size categories in North America. Barra emphasized GM’s commitment to gradually increasing production of the electric Chevrolet Equinox while maintaining a focus on disciplined volume growth.
Earlier this month, 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 slowdown in the market. Despite this, the company plans to remain flexible and produce according to demand, as it reported growth in electric vehicle sales last quarter.
Barra also revealed that Cruise, GM’s self-driving division, would discontinue its Origin vehicle in favor of utilizing the next-generation Chevrolet Bolt for testing in Texas and Arizona. This decision follows a production halt related to the Origin after an incident last October, which led to a $600 million charge for GM. Barra noted that using the Bolt would help address regulatory concerns regarding the unique design of the Origin, such as its absence of a steering wheel, while also reducing costs and optimizing resources.
“Our vision to transform mobility using autonomous technology remains strong, and each mile traveled, and every simulation, brings us closer, as Cruise continues to prioritize AI,” Barra stated.
Additionally, GM is working to restructure its joint venture in China with SAIC Motor, as it continues to incur losses, including a $104 million loss in the second quarter. In June, SAIC-GM reduced production by 70%, delivering 26,000 vehicles, which is a 50% decrease compared to the same time last year, according to Automotive News.