General Motors is updating its financial outlook for 2024 after exceeding analysts’ expectations in the second quarter. The Detroit-based automaker has revised its projected adjusted earnings for the year to a range of $13 billion to $15 billion, an increase from the previous estimate of $12.5 billion to $14.5 billion. Additionally, expectations for operating cash flow and earnings per share have also been raised, while the forecast for net income attributable to shareholders has been slightly reduced, now estimated to be between $10 billion and $11.4 billion.
For the second quarter, GM reported revenue of $47.9 billion, marking over a 7% rise compared to the same period last year and surpassing Wall Street’s forecast of $45 billion. Earnings per share rose to $3.06, beating analyst predictions of $2.71, and representing a 60% increase from 2023. Net income was up 14%, reaching $2.9 billion compared to $2.5 billion a year ago.
As a result of these strong financial results, GM’s stock rose nearly 5% in pre-market trading on Tuesday, and has surged over 37% since the start of the year. The company also announced a cash dividend for the third quarter, contributing to the stock’s upward momentum.
In a letter to shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs and mentioned plans to launch eight new or redesigned models in North America. She also discussed ramping up production of the electric Chevrolet Equinox, emphasizing GM’s commitment to responsible growth in electric vehicle sales, despite a recent admission that the company is unlikely to meet its goal of producing 1 million electric vehicles in North America by the end of 2025 due to market challenges.
Barra also provided updates on Cruise, GM’s autonomous driving unit, which has halted operations of its Origin vehicle following a previous incident. The company will now focus on testing the next-generation Chevrolet Bolt in Texas and Arizona. GM took a $600 million charge related to the cessation of Origin production in Detroit.
During a call with analysts, Barra noted that utilizing the Bolt would address regulatory concerns around the Origin’s unconventional design, such as its lack of a steering wheel. This change is expected to reduce costs and enhance resource management.
Furthermore, GM is working to restructure its joint venture with SAIC Motor in China amid ongoing losses, which amounted to $104 million in the second quarter. Production was significantly reduced in June, with SAIC-GM delivering 26,000 vehicles, representing a 50% decline compared to the previous year.