General Motors has updated its financial outlook for 2024 after exceeding Wall Street’s expectations for its second-quarter results. The Detroit-based automaker has raised its projection for adjusted earnings to a range of $13 billion to $15 billion, up from an earlier forecast of $12.5 billion to $14.5 billion. Additionally, GM has increased its targets for operating cash flow and earnings per share, though it slightly reduced its expectations for net income attributable to shareholders to between $10 billion and $11.4 billion.
For the second quarter, GM reported revenue of $47.9 billion, which represents a more than 7% increase from the same period last year and surpasses Wall Street’s anticipated $45 billion, based on FactSet estimates. Earnings per share reached $3.06, exceeding the anticipated $2.71 and marking a 60% increase compared to 2023. The company’s net income also rose 14% to $2.9 billion, up from $2.5 billion.
The strong performance drove GM’s stock up nearly 5% in pre-market trading on Tuesday, with the stock having increased over 37% year-to-date. After the market closed on Monday, GM announced a cash dividend for the third quarter, contributing to the stock’s positive momentum.
In a letter to shareholders, CEO Mary Barra highlighted the strong demand for GM’s gas-powered trucks and SUVs. She mentioned that the company plans to launch eight new or redesigned vehicle models in various categories across North America. Barra also noted that GM is ramping up production of the electric Chevrolet Equinox, emphasizing the company’s commitment to disciplined growth in its electric vehicle (EV) division.
Earlier this month, Barra acknowledged that GM would not meet its goal of producing 1 million electric vehicles in North America by the end of 2025, attributing this to a slowdown in the market. The company has indicated it will adapt its production to align with consumer demand, although it did see an increase in EV sales last quarter.
Furthermore, Barra announced that Cruise, GM’s autonomous driving unit, would abandon its plans for the Origin autonomous vehicle following a previous operational rollback. Instead, Cruise will focus on utilizing the next-generation Chevrolet Bolt for testing in Texas and Arizona. GM took a $600 million charge related to the cessation of Origin’s production in Detroit.
During a conference call with analysts, Barra reassured that the company’s vision for transforming mobility through autonomous technology remains unchanged. Utilizing the Bolt is expected to mitigate regulatory concerns associated with the Origin’s unconventional design and will also reduce production costs.
Additionally, GM is in the process of restructuring its joint venture in China with SAIC Motor, as it grapples with ongoing financial losses, which amounted to $104 million in the second quarter. Earlier this year, SAIC-GM cut production by 70%, delivering only 26,000 vehicles, which is 50% less than the prior year.