General Motors has raised its financial outlook for 2024 after exceeding Wall Street’s expectations for its second quarter results. The automaker now anticipates adjusted earnings for the year to be between $13 billion and $15 billion, an increase from the previous forecast of $12.5 billion to $14.5 billion. Additionally, GM has lifted its targets for operating cash flow and earnings per share, while slightly lowering its net income expectations for shareholders to between $10 billion and $11.4 billion.
In the second quarter, GM reported revenue of $47.9 billion, marking a rise of over 7% compared to last year and surpassing Wall Street’s expectations of $45 billion. Earnings per share stood at $3.06, exceeding analyst predictions of $2.71 and reflecting a 60% increase from 2023. The company also saw a 14% rise in net income, reaching $2.9 billion compared to $2.5 billion in the previous year.
Following these announcements, GM’s stock climbed nearly 5% in pre-market trading on Tuesday and has risen more than 37% this year. The company also declared a cash dividend for the third quarter, providing further support to its stock.
CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs in a letter to shareholders and mentioned the company’s plan to launch eight new or redesigned models in North America. She emphasized the scaling production of the electric Chevrolet Equinox and noted the commitment to disciplined growth in the electric vehicle (EV) sector. However, Barra acknowledged that GM is unlikely to meet its goal of producing 1 million EVs in North America by the end of 2025 due to a slowdown in the market.
Barra also announced a strategic change for Cruise, GM’s self-driving division, which will no longer pursue its Origin vehicle following operational setbacks last October. Instead, Cruise will focus on utilizing the next-generation Chevrolet Bolt as it tests its vehicles in Texas and Arizona. This shift is expected to address regulatory concerns about the Origin’s design and reduce production costs.
GM aims to revamp its joint venture with SAIC Motor in China as it continues to face losses, reporting a $104 million loss for the second quarter alone. Production cuts of 70% were implemented by SAIC-GM in June, resulting in the delivery of 26,000 vehicles, which is 50% less than the prior year.