General Motors has significantly raised its financial projections for 2024 following a strong second-quarter performance that exceeded Wall Street’s estimates.
The company has adjusted its anticipated adjusted earnings for the year to a range of $13 billion to $15 billion, up from a previous expectation of $12.5 billion to $14.5 billion. Additionally, GM increased its targets for operating cash flow and earnings per share while slightly lowering its expectations for net income attributable to shareholders to between $10 billion and $11.4 billion, a decrease of less than 1%.
In the second quarter, GM reported revenue of $47.9 billion, marking an increase of more than 7% from the previous year and surpassing Wall Street’s predicted $45 billion. Earnings per share reached $3.06, exceeding analysts’ expectations of $2.71 per share and reflecting a 60% increase compared to 2023. Net income also rose by 14%, amounting to $2.9 billion, up from $2.5 billion.
Following these results, GM’s stock surged nearly 5% in pre-market trading on Tuesday and has increased by over 37% this year. The company announced a cash dividend for the third quarter, further boosting investor confidence.
In a letter to shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs and mentioned the launch of eight new or redesigned vehicles across various sizes in North America. Barra emphasized the company’s commitment to disciplined growth in electric vehicle production, noting their ongoing efforts to ramp up the electric Chevrolet Equinox.
Despite the positive outlook, Barra indicated earlier this month 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 market slowdown. The automaker plans to adapt by building to demand, although it did see growth in EV sales last quarter.
Barra also shared that Cruise, GM’s autonomous driving unit, will discontinue its unique Origin vehicle following operational setbacks last October. Instead, Cruise will concentrate on using the next-generation Chevrolet Bolt for testing in Texas and Arizona. This decision follows a $600 million charge related to the halt in Origin production.
During an earnings call, Barra stated that utilizing the Bolt will address regulatory concerns surrounding the Origin’s unconventional design, which lacks a steering wheel. This pivot will also reduce costs and streamline resources.
Despite these challenges, Barra reaffirmed GM’s commitment to advancing mobility through autonomous technology, stating that every mile driven and simulation brings them closer to that goal.
Additionally, GM is working to restructure its joint venture with SAIC Motor in China, as it faces ongoing financial losses, including a $104 million loss in the second quarter. In June, SAIC-GM dramatically reduced production by 70%, delivering only 26,000 vehicles—50% fewer than the same period last year, as reported by Automotive News.