General Motors has revised several financial projections for 2024 after exceeding Wall Street expectations in its second quarter results.
The Detroit-based automaker now anticipates adjusted earnings for the year to fall between $13 billion and $15 billion, an increase from the previous range of $12.5 billion to $14.5 billion. Additionally, GM has raised its forecasts for operating cash flow and earnings per share. However, the expected net income for shareholders has been slightly adjusted downward by less than 1%, now projected to be between $10 billion and $11.4 billion.
In the second quarter, GM reported revenue of $47.9 billion, marking over a 7% increase from the same period last year and surpassing Wall Street’s forecast of $45 billion, as per FactSet estimates. Earnings per share reached $3.06, exceeding the expected $2.71 and showing a 60% increase from 2023. The company’s net income rose 14% to $2.9 billion, up from $2.5 billion.
Following these announcements, GM’s stock surged nearly 5% in pre-market trading on Tuesday, with the stock price increasing over 37% this year. Additionally, GM declared a cash dividend for the third quarter, further boosting investor confidence.
In a letter to shareholders, CEO Mary Barra highlighted the strong performance of GM’s gas-powered trucks and SUVs. She mentioned that the company is actively launching eight new or redesigned models across various sizes in North America. Barra emphasized that GM is ramping up production of the electric Chevrolet Equinox and expressed a commitment to responsible growth in electric vehicle (EV) production, despite acknowledging that the company’s target of producing 1 million EVs in North America by the end of 2025 may not be attainable due to a market slowdown. Nevertheless, GM’s EV sales saw growth last quarter.
Furthermore, Barra announced that Cruise, GM’s autonomous driving division, will discontinue its Origin vehicle, shifting focus to using the next-generation Chevrolet Bolt for tests in Texas and Arizona. This decision follows a $600 million charge associated with halting Origin production in Detroit. Barra indicated that utilizing the Bolt addresses regulatory concerns regarding the unique design of the Origin, including its lack of a steering wheel, while also reducing costs and optimizing resources.
“Every mile traveled and every simulation brings us closer to our goal of transforming mobility through autonomous technology,” Barra said in a statement.
GM is also working to restructure its partnership in China with SAIC Motor, where it continues to face losses, posting a $104 million loss for the second quarter. In June, SAIC-GM reduced production by 70%, delivering only 26,000 vehicles, a decrease of 50% compared to the previous year, according to Automotive News.