General Motors (GM) has revised several financial projections for 2024 following strong second-quarter results that exceeded Wall Street expectations. The Detroit-based automaker has increased its anticipated adjusted earnings for the year to a range between $13 billion and $15 billion, up from the previous forecast of $12.5 billion to $14.5 billion. Additionally, GM has raised its targets for operating cash flow and earnings per share, while slightly decreasing its expectations for net income attributable to shareholders to between $10 billion and $11.4 billion.
The company’s revenue for the second quarter reached $47.9 billion, reflecting a more than 7% increase compared to the previous year and surpassing Wall Street’s expectation of $45 billion, according to FactSet estimates. Earnings per share were reported at $3.06, significantly higher than the $2.71 expected by analysts and 60% greater than in 2023. GM’s net income rose by 14%, totaling $2.9 billion, up from $2.5 billion.
Following these announcements, GM’s stock saw a nearly 5% rise in pre-market trading on Tuesday, with the shares having increased more than 37% this year. After the market closed on Monday, GM declared a cash dividend for the third quarter, further boosting investor confidence.
In her letter to shareholders, CEO Mary Barra highlighted the success of the company’s gas-powered trucks and SUVs while detailing plans to launch eight new or redesigned models across different categories in North America. Barra emphasized GM’s commitment to scaling production of the electric Chevrolet Equinox, stating, “as excited as we are about our EVs and our early success, we are committed to disciplined volume growth.”
However, Barra also acknowledged that GM will not meet its goal of producing 1 million electric vehicles in North America by the end of 2025, attributing the setback to a slowdown in the market. The company aims to remain flexible and “build to demand,” even as EV sales increased last quarter.
In a strategic shift, Barra announced that Cruise, GM’s autonomous vehicle division, will discontinue its Origin vehicle, which faced operational setbacks after an incident last October. Instead, the focus will pivot to testing the next-generation Chevrolet Bolt in Texas and Arizona. GM incurred a $600 million charge due to the suspension of Origin production in Detroit.
During a call with analysts, Barra explained that utilizing the Bolt would address regulatory concerns about the Origin’s distinctive design, which lacked a steering wheel. This adjustment is expected to reduce per-unit costs and enhance resource allocation.
Barra reiterated GM’s dedication to reshaping mobility with autonomous technology, stating that each mile traveled and simulation conducted brings the company closer to its vision, as Cruise operates as an AI-first company.
Additionally, GM is working to restructure its joint venture with SAIC Motor in China, where the company reported a $104 million loss for the second quarter. In June, SAIC-GM significantly reduced production by 70%, delivering 26,000 vehicles, a 50% decrease from the previous year, as reported by Automotive News.