General Motors is increasing several financial projections for 2024 after exceeding Wall Street estimates in its second quarter results. The Detroit-based automaker has raised its expected adjusted earnings for the year to a range of $13 billion to $15 billion, up from a previous forecast of $12.5 billion to $14.5 billion, and has also updated its targets for operating cash flow and earnings per share. Meanwhile, the expected net income attributable to shareholders has been slightly reduced by less than 1%, now projected to be between $10 billion and $11.4 billion.
For the second quarter, GM reported revenue of $47.9 billion, marking a more than 7% increase year-over-year and surpassing the $45 billion anticipated by Wall Street analysts. Earnings per share also exceeded expectations at $3.06, compared to the $2.71 forecasted, and reflected a 60% increase from 2023. Net income for the quarter rose by 14%, reaching $2.9 billion, up from $2.5 billion.
Following these announcements, GM stock saw a nearly 5% increase in pre-market trading on Tuesday and has risen over 37% this year. Furthermore, the company declared a third-quarter cash dividend after market close on Monday, which contributed to the stock’s rise.
In a letter to shareholders, CEO Mary Barra highlighted the strong performance of GM’s gas-powered trucks and SUVs. She mentioned that the company is launching eight new or redesigned models across compact, mid-size, and full-size categories in North America. Barra also addressed the ramp-up in production of the electric Chevrolet Equinox and emphasized GM’s commitment to disciplined volume growth despite current market conditions.
Earlier this month, Barra acknowledged that GM would not meet its aim of producing 1 million electric vehicles in North America by the end of 2025 due to market slowdowns. She asserted that the company would remain flexible and adapt production to meet demand, although EV sales did see growth last quarter.
Additionally, Barra announced that Cruise, GM’s autonomous driving subsidiary that experienced operational setbacks last October, would abandon its Origin vehicle project. Instead, the focus will shift to the next-generation Chevrolet Bolt for testing in Texas and Arizona. GM incurred a $600 million charge related to halting Origin production in Detroit.
During an analyst call, Barra indicated that using the Bolt would help address regulatory concerns regarding the unique design of the Origin, which does not feature a steering wheel. She noted that this change would also decrease per-unit costs and allow GM to optimize its resources.
GM is also restructuring its joint venture in China with SAIC Motor, as the partnership continues to face financial losses, including a $104 million loss reported for the second quarter. In June, SAIC-GM reduced production by 70%, delivering only 26,000 vehicles, which represents a 50% decline compared to the same period last year.