General Motors has updated its financial projections for 2024 after exceeding Wall Street forecasts for its second quarter results. The Detroit-based automaker increased its anticipated adjusted earnings for the year to a range of $13 billion to $15 billion, up from previous estimates of $12.5 billion to $14.5 billion. Additionally, GM raised its targets for operating cash flow and earnings per share, while slightly downgrading forecasts for net income attributable to shareholders to between $10 billion and $11.4 billion.
In the second quarter, GM reported revenue of $47.9 billion, marking an increase of over 7% compared to the same period last year and surpassing Wall Street’s expectation of $45 billion, according to FactSet. The company’s earnings per share were $3.06, exceeding the anticipated $2.71 and reflecting a 60% increase from 2023. Net income also rose by 14% to $2.9 billion, up from $2.5 billion the previous year.
Following the announcement, GM’s stock surged nearly 5% in pre-market trading on Tuesday, with the stock having increased over 37% this year. GM also declared a third-quarter cash dividend, which contributed to the stock’s rise.
In her letter to shareholders, CEO Mary Barra highlighted the demand for its gasoline-powered trucks and SUVs and noted that GM plans to introduce eight new or revamped models in North America. She mentioned that the company is ramping up production of the electric Chevrolet Equinox and expressed a commitment to disciplined growth in electric vehicle (EV) production.
Earlier in the month, Barra acknowledged that GM is unlikely to meet its target of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown. However, she stated that the company would remain flexible and “build to demand,” despite a growth in EV sales last quarter.
Barra also revealed that GM’s self-driving division, Cruise, will abandon its Origin vehicle after scaling back operations following an incident last October. Instead, Cruise will pivot to utilizing the next-generation Chevrolet Bolt for testing in Texas and Arizona. The decision to halt production of the Origin will incur a $600 million charge for GM.
During an analyst call, Barra explained that shifting to the Bolt will address regulatory concerns related to the Origin’s unconventional design, such as its absence of a steering wheel. This transition is also expected to reduce per-unit costs and enhance resource optimization.
GM is concurrently working on restructuring its joint venture with SAIC Motor in China, where it is encountering losses. The company reported a $104 million loss for the second quarter, and in June, SAIC-GM significantly reduced production by 70%, delivering only 26,000 vehicles—a 50% drop compared to the previous year.