General Motors is adjusting its financial projections for 2024 after exceeding analysts’ expectations during the second quarter. The automaker has raised its forecast for adjusted earnings for the year to a range of $13 billion to $15 billion, up from the previous estimate of $12.5 billion to $14.5 billion. It has also increased its targets for operating cash flow and earnings per share, while slightly decreasing expectations 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 over a 7% increase from the previous year and surpassing Wall Street’s anticipated $45 billion, as reported by FactSet. Earnings per share reached $3.06, exceeding analysts’ expectations of $2.71 and representing a 60% increase compared to 2023. Net income rose 14% to $2.9 billion, up from $2.5 billion.
Following these results, GM’s stock saw a nearly 5% rise in pre-market trading on Tuesday and has gained over 37% this year. The company announced a third-quarter cash dividend after trading closed on Monday, further boosting its stock.
In a letter to shareholders, CEO Mary Barra emphasized the success of GM’s gas-powered trucks and SUVs and mentioned the upcoming launch of eight new or redesigned vehicle models in North America. Barra highlighted the scaling production of the electric Chevrolet Equinox, reaffirming GM’s commitment to disciplined volume growth despite recent comments indicating that the company will not meet its goal of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown.
Additionally, Barra announced that Cruise, GM’s self-driving division, is abandoning its Origin vehicle after having to scale back its operations following an incident last year. Instead, the division will focus on testing the next-generation Chevrolet Bolt in Texas and Arizona. GM has incurred a $600 million charge related to the suspension of Origin production.
In interaction with analysts, Barra mentioned that pivoting to the Bolt would alleviate regulatory concerns related to the Origin’s unique design, such as the absence of a steering wheel, and will also reduce unit costs and optimize resources. She reiterated GM’s commitment to transforming mobility through autonomous technology and explained that every mile traveled and simulation brings the company closer to its goals.
GM is also working on restructuring its joint venture with SAIC Motor in China, where it has been experiencing losses, including a reported loss of $104 million for the second quarter. In June, SAIC-GM significantly reduced production by 70%, delivering 26,000 vehicles, a decline of 50% compared to the previous year.