General Motors (GM) is set to elevate its financial forecasts for 2024 following a strong second-quarter performance that exceeded Wall Street’s predictions. The automaker has adjusted its expected adjusted earnings for the year to a range between $13 billion and $15 billion, an increase from the previous forecast of $12.5 billion to $14.5 billion. Additionally, GM raised its targets for operating cash flow and earnings per share, although it slightly decreased its expectations for net income attributable to shareholders to between $10 billion and $11.4 billion.
In the second quarter alone, GM reported revenues of $47.9 billion, marking a more than 7% increase from the previous year and surpassing the anticipated $45 billion threshold set by analysts. The company’s earnings per share hit $3.06, comfortably outpacing the forecast of $2.71 and representing a 60% rise compared to 2023. Net income climbed 14% to $2.9 billion, up from $2.5 billion.
Following this favorable news, GM’s stock saw an approximate 5% increase in pre-market trading and has risen over 37% year-to-date. In addition, GM announced a third-quarter cash dividend, further boosting market confidence in the company.
CEO Mary Barra highlighted the popularity of GM’s gas-powered trucks and SUVs in a letter to shareholders, while also discussing the launch of eight new or redesigned vehicle models across various categories in North America. With regard to electric vehicles, Barra mentioned that GM is ramping up production of the electric Chevrolet Equinox but also acknowledged that the company would miss its goal of producing 1 million electric vehicles in North America by 2025 due to market conditions. However, she reassured investors of a commitment to disciplined growth aligned with demand, as evidenced by an increase in EV sales in the last quarter.
Barra also addressed developments concerning Cruise, GM’s self-driving unit, optings to discontinue its Origin vehicle design in favor of using the next-generation Chevrolet Bolt for testing in states like Texas and Arizona. This decision aims to mitigate regulatory concerns regarding the unique design of the Origin and allows GM to optimize production costs, shifting focus to a more conventional vehicle.
Despite challenges, including a restructuring of its joint venture in China with SAIC Motor, which reported a second-quarter loss of $104 million, GM remains committed to ensuring its vision for the future of autonomous technology. The company continues to adapt and innovate, aiming for a significant transformation in mobility.
Overall, GM’s recent performance and adjustments signal a positive outlook for the automotive giant’s operations, especially as it navigates through a rapidly changing industry landscape. This resilient approach could lay the foundation for future advancements, particularly in electric and autonomous vehicle technologies.