General Motors is adjusting its financial outlook for 2024 following strong second-quarter results that surpassed Wall Street’s expectations. The automaker has increased its anticipated adjusted earnings for the year to a range of $13 billion to $15 billion, up from a previous estimate of $12.5 billion to $14.5 billion. Additionally, GM has revised its targets for operating cash flow and earnings per share, while reducing its expectations for net income attributable to shareholders slightly, now projected between $10 billion and $11.4 billion.
For the second quarter, GM reported revenue of $47.9 billion, representing an increase of over 7% compared to the same period last year and exceeding the $45 billion forecast by analysts, according to FactSet estimates. Earnings per share reached $3.06, surpassing the anticipated $2.71 per share and marking a 60% rise from 2023. Net income rose 14% to $2.9 billion, up from $2.5 billion.
Following the earnings report, GM’s stock increased by nearly 5% in pre-market trading on Tuesday and has surged more than 37% this year. The company also declared a third-quarter cash dividend, contributing to its positive stock performance.
In a letter to shareholders, CEO Mary Barra highlighted the strong performance of GM’s gas-powered trucks and SUVs. She mentioned the initiative to launch eight new or redesigned vehicle models in North America and noted that the company is actively scaling up production of the electric Chevrolet Equinox. Barra expressed commitment to disciplined growth in electric vehicle production, despite earlier acknowledging that GM would not meet its target of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown. However, she pointed out that electric vehicle sales grew in the last quarter.
Barra also announced changes to Cruise, GM’s self-driving division, stating that the company would discontinue its Origin vehicle in favor of using the next-generation Chevrolet Bolt for testing in Texas and Arizona. This shift follows difficulties faced by Cruise after an incident last October and aims to address regulatory concerns regarding the Origin’s unique design, which lacked a steering wheel. GM incurred a $600 million charge related to the halt in Origin production.
During a conference call with analysts, Barra reaffirmed GM’s commitment to transforming mobility through autonomous technology, stating that each testing mile and simulation brings Cruise closer to its goals.
Additionally, GM is in the process of restructuring its joint venture with SAIC Motor in China, as the company continues to experience losses, including a $104 million loss reported for the second quarter. In June, SAIC-GM significantly reduced production by 70%, delivering 26,000 vehicles, which is 50% less than the previous year, according to Automotive News.