General Motors has raised several financial targets for 2024 after exceeding Wall Street’s expectations for its second quarter results.
The automaker increased its adjusted earnings forecast for the year to between $13 billion and $15 billion, an increase from the previous range of $12.5 billion to $14.5 billion. Additionally, GM raised its targets for operating cash flow and earnings per share, while lowering its expectations for net income attributable to shareholders by less than 1%, now expecting between $10 billion and $11.4 billion.
For the second quarter, GM reported revenue of $47.9 billion, a more than 7% rise from the previous year and surpassing Wall Street’s expectation of $45 billion. Earnings per share stood at $3.06, exceeding analyst predictions of $2.71 and showing a 60% increase compared to 2023. The company’s net income grew by 14% to $2.9 billion, up from $2.5 billion.
Following these results, GM’s stock rose nearly 5% in pre-market trading on Tuesday, and it has seen an increase of over 37% this year. Recently, GM declared a third-quarter cash dividend, contributing to the stock’s upswing.
In a letter to shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs, noting that the company is launching eight new or redesigned vehicle models in North America. Barra emphasized the production scaling of the electric Chevrolet Equinox, expressing enthusiasm about their electric vehicles while committing to disciplined volume growth.
Earlier this month, Barra indicated that GM would not achieve its goal of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown. The company plans to be flexible and “build to demand,” though their electric vehicle sales did see growth in the last quarter.
Additionally, Barra announced that Cruise, GM’s self-driving division, would discontinue its Origin vehicle following a production halt related to an incident last October. Instead, Cruise will focus on utilizing the next-generation Chevrolet Bolt for vehicle testing in Texas and Arizona. GM has incurred a $600 million charge associated with the cessation of Origin production in Detroit.
During an analyst call, Barra mentioned that transitioning to the Bolt would address regulatory concerns regarding the Origin’s unique design, such as its lack of a steering wheel. This decision is expected to reduce per-unit costs and help GM optimize resource allocation.
Barra reaffirmed GM’s mission to transform mobility through autonomous technology, stating that “every mile traveled, and every simulation, brings us closer” as Cruise continues to operate as an AI-first company.
Furthermore, GM is working to restructure its joint venture in China with SAIC Motor, as the company continues to experience losses, reporting a $104 million loss for the second quarter. Production cuts of 70% by SAIC-GM in June led to deliveries of 26,000 vehicles, a decrease of 50% compared to the previous year, according to Automotive News.