General Motors is adjusting its financial outlook for 2024 after exceeding Wall Street’s expectations in its second quarter results.
The automaker has revised its projected adjusted earnings for the year to a range of $13 billion to $15 billion, an increase from the previous range of $12.5 billion to $14.5 billion. Additionally, GM has raised its targets for operating cash flow and earnings per share. However, it has slightly reduced its expectations for net income attributable to shareholders to between $10 billion and $11.4 billion, a decrease of less than 1%.
For the second quarter, GM reported revenue of $47.9 billion, marking more than a 7% rise year-over-year and surpassing the $45 billion forecast by analysts, according to FactSet. Earnings per share reached $3.06, exceeding the anticipated $2.71 and reflecting a 60% increase compared to 2023. Net income rose by 14%, climbing to $2.9 billion from $2.5 billion.
Following these reports, GM stock surged nearly 5% in pre-market trading on Tuesday and has seen more than a 37% increase this year. After the market closed on Monday, GM announced a third-quarter cash dividend, further boosting its stock value.
In a letter to shareholders, CEO Mary Barra highlighted the success of the company’s gas-powered trucks and SUVs and mentioned the launch of eight new or redesigned models in North America. She also discussed the scaling production of the electric Chevrolet Equinox, emphasizing GM’s commitment to disciplined volume growth despite previous challenges. 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 due to a slowdown in the market. Nevertheless, EV sales increased last quarter.
Additionally, Barra indicated that GM’s self-driving unit, Cruise, has paused its Origin vehicle project after an incident in October and will instead utilize the next-generation Chevrolet Bolt for testing in Texas and Arizona. The company incurred a $600 million charge related to the suspension of the Origin’s production in Detroit.
Barra clarified that using the Bolt would address regulatory concerns about the unique design of the Origin, as well as reduce costs per unit and optimize resources.
“Our vision to transform mobility using autonomous technology remains unchanged. Each mile traveled and every simulation brings us closer because Cruise is an AI-first company,” stated Barra.
GM is also restructuring its joint venture in China with SAIC Motor amid ongoing losses, reporting a $104 million loss in the second quarter. In June, SAIC-GM significantly reduced production by 70% and delivered 26,000 vehicles, which is a 50% decline compared to the previous year, as noted by Automotive News.