General Motors has revised its financial goals for 2024 after significantly exceeding Wall Street’s projections in the second quarter. The automaker has increased its expected 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. Additionally, targets for operating cash flow and earnings per share have been raised, although the forecast for net income attributable to shareholders has been slightly reduced by less than 1%, now estimated to be between $10 billion and $11.4 billion.
For the second quarter, GM reported revenue of $47.9 billion—a more than 7% increase compared to last year and surpassing the $45 billion anticipated by Wall Street, according to FactSet estimates. Earnings per share reached $3.06, exceeding the expected $2.71 and representing a 60% increase from 2023. The company’s net income rose by 14%, reaching $2.9 billion, an increase from $2.5 billion.
Following these announcements, GM stock experienced a nearly 5% rise in pre-market trading on Tuesday, marking an increase of over 37% for the year. After the market closed on Monday, GM declared a cash dividend for the third quarter, contributing to the stock’s upward momentum.
In a letter to shareholders, CEO Mary Barra highlighted the strong performance of GM’s gas-powered trucks and SUVs, mentioning that the company plans to launch eight new or redesigned models across various sizes in North America. She emphasized GM’s commitment to scaling production of the electric Chevrolet Equinox, stating, “as excited as we are about our EVs and our early success, we are committed to disciplined volume growth.” Barra had previously indicated that GM would not meet its target of producing 1 million electric vehicles in North America by the end of 2025 due to a slowdown in the market, but noted that EV sales did increase last quarter.
The CEO also unveiled a strategic shift for Cruise, GM’s self-driving division, which had to scale back operations after an incident last October. The company has decided to abandon its Origin vehicle and will concentrate on using the next-generation Chevrolet Bolt for testing in Texas and Arizona. This decision involves a $600 million charge associated with the production halt of the Origin.
During a call with analysts, Barra stated that utilizing the Bolt would address regulatory concerns regarding the Origin’s unconventional design, such as the absence of a steering wheel. This pivot is expected to reduce per-unit costs and enable GM to better allocate resources.
“Our vision to transform mobility using autonomous technology is unchanged, and every mile traveled, and every simulation, brings us closer because Cruise is an AI-first company,” Barra said.
Moreover, GM is seeking to restructure its joint venture in China with SAIC Motor, as the partnership continues to incur losses. In the second quarter, GM reported a loss of $104 million. As of June, SAIC-GM had cut production by 70%, delivering 26,000 vehicles, which is 50% fewer than the same period last year.