General Motors has updated its financial projections for 2024 after exceeding Wall Street’s estimates for the second quarter. The Detroit-based automaker has increased its anticipated adjusted earnings for the year to a range of $13 billion to $15 billion, up from the previous forecast of $12.5 billion to $14.5 billion. Additionally, GM raised its expectations for operating cash flow and earnings per share, while slightly adjusting its net income attributable to shareholders downwards by less than 1%, now estimated to be between $10 billion and $11.4 billion.
In the second quarter, GM reported revenue of $47.9 billion, reflecting a more than 7% increase from the previous year and surpassing the $45 billion forecast by Wall Street, as per FactSet estimates. Earnings per share were reported at $3.06, exceeding analysts’ predictions of $2.71 per share and marking a 60% rise from 2023. The company’s net income increased by 14%, reaching $2.9 billion, compared to $2.5 billion in the same period last year.
Following the news, GM’s stock rose nearly 5% in pre-market trading and has seen a total increase of more than 37% this year. On Monday, GM announced a third-quarter cash dividend, which further boosted its stock price.
In a shareholder letter, CEO Mary Barra highlighted the success of the company’s gas-powered trucks and SUVs and discussed plans for launching eight new or redesigned vehicle models across various sizes in North America. She also mentioned that GM is ramping up production of the electric Chevrolet Equinox, emphasizing a commitment to disciplined growth in EV sales, despite acknowledging that the goal of producing 1 million electric vehicles in North America by the end of 2025 will not be achieved due to a market slowdown. GM plans to remain flexible and “build to demand” while noting that EV sales rose last quarter.
Furthermore, Barra announced that Cruise, GM’s self-driving division, will abandon its Origin vehicle project in favor of utilizing the next-generation Chevrolet Bolt for testing in Texas and Arizona. This decision follows a setback in operations last October and is expected to alleviate regulatory concerns regarding the Origin’s novel design, including its absence of a steering wheel. The switch is also anticipated to reduce per-unit costs and enhance resource allocation.
Barra reaffirmed GM’s commitment to transforming mobility through autonomous technology, stating that each mile traveled and every simulation advances their vision as Cruise operates as an AI-first company.
Lastly, GM is looking to restructure its joint venture with SAIC Motor in China due to ongoing losses, reporting a $104 million loss for the second quarter. In June, production cuts at SAIC-GM led to a 70% reduction, with only 26,000 vehicles delivered, marking a 50% decrease compared to the previous year.