General Motors has revised its financial outlook for 2024 after exceeding Wall Street expectations in the second quarter. The company has raised its forecast for adjusted earnings to between $13 billion and $15 billion, up from a previous estimate of $12.5 billion to $14.5 billion. Additionally, it has increased targets for operating cash flow and earnings per share. However, GM slightly lowered its 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 an increase of over 7% compared to the previous year and surpassing the anticipated $45 billion. Earnings per share reached $3.06, exceeding analyst projections of $2.71 and showing a 60% increase from 2023. Net income rose 14% to $2.9 billion, up from $2.5 billion.
Following these announcements, GM stock surged nearly 5% in pre-market trading on Tuesday, contributing to a 37% rise in stock value this year. On Monday after trading hours, GM also declared a cash dividend for the third quarter.
In her letter to shareholders, CEO Mary Barra highlighted the success of the company’s gas-powered trucks and SUVs and mentioned plans to launch eight new or redesigned models in North America. She also discussed the ramp-up of production for the electric Chevrolet Equinox, emphasizing their commitment to careful volume growth despite earlier setbacks in electric vehicle production goals. GM recently acknowledged it would not meet its target of producing 1 million electric vehicles in North America by the end of 2025, attributing the decision to a market slowdown.
Moreover, Barra announced a shift in strategy for Cruise, GM’s self-driving division, which has scaled back operations since last October. The company will now focus on utilizing the next-generation Chevrolet Bolt instead of its previously planned Origin vehicle, which had faced regulatory concerns and costly production halts. GM incurred a $600 million charge related to the pause in Origin production.
During a call with analysts, Barra reaffirmed GM’s commitment to transforming mobility through autonomous technology, stating that each mile and simulation brings them closer to their goals.
In addition, GM is restructuring its joint venture with SAIC Motor in China, where it has been experiencing losses, culminating in a $104 million loss in the second quarter. Production was significantly reduced in June, with SAIC-GM delivering 26,000 vehicles, a 50% decline from the previous year.