General Motors has updated its financial forecasts for 2024 following a strong second quarter that exceeded Wall Street’s predictions. The automaker has revised its expected adjusted earnings for the year to range between $13 billion and $15 billion, an increase from the previous estimate of $12.5 billion to $14.5 billion. Additionally, GM raised its targets for operating cash flow and earnings per share, although the outlook for net income attributable to shareholders was slightly reduced by less than 1%, now anticipated to be between $10 billion and $11.4 billion.
For the second quarter, GM reported revenue of $47.9 billion, reflecting a more than 7% rise year-over-year and surpassing Wall Street’s expectation of $45 billion. Earnings per share stood at $3.06, exceeding the $2.71 forecast by analysts and representing a 60% increase from the previous year. The company’s net income increased by 14%, reaching $2.9 billion compared to $2.5 billion.
Following the earnings report, GM’s stock experienced a nearly 5% jump in pre-market trading and has risen over 37% this year. After market close on Monday, GM announced a cash dividend for the third quarter, further boosting investor confidence.
In her letter to shareholders, CEO Mary Barra highlighted the strong performance of the company’s gas-powered trucks and SUVs. She also mentioned that GM is in the process of launching eight new or redesigned models in North America, including compact, mid-size, and full-size vehicles. Barra emphasized the company’s commitment to disciplined growth in the electric vehicle market, despite acknowledging that GM will not meet its goal of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown. Nonetheless, GM’s electric vehicle sales did see an uptick last quarter.
Moreover, Barra shared that Cruise, GM’s self-driving unit, will discontinue its Origin vehicle model, which had faced regulatory challenges, and pivot to using the next-generation Chevrolet Bolt for testing in Texas and Arizona. This shift is expected to alleviate regulatory concerns regarding the Origin’s design and will aid in cost management and resource optimization for GM. The company incurred a $600 million charge associated with the halt in Origin production.
Barra reaffirmed GM’s commitment to transforming mobility through autonomous technology, stating that each advancement in testing brings the company closer to its goals.
GM is also working on restructuring its joint venture in China with SAIC Motor amid facing losses, reporting a $104 million loss in the second quarter. In June, SAIC-GM reduced production by 70%, delivering 26,000 vehicles, which is 50% lower than the figures from the previous year.