General Motors has updated its financial forecasts for 2024 following a strong performance that exceeded Wall Street expectations in the second quarter. The company now projects adjusted earnings for the year to be in the range of $13 billion to $15 billion, an increase from the prior estimate of $12.5 billion to $14.5 billion. In addition, GM raised its targets for operating cash flow and earnings per share, while net income expectations were slightly decreased to between $10 billion and $11.4 billion.
For the second quarter, GM reported revenue of $47.9 billion, marking a more than 7% increase from the previous year and surpassing analyst expectations of $45 billion. Earnings per share stood at $3.06, significantly higher than the anticipated $2.71 and 60% up from 2023 figures. Net income was reported at $2.9 billion, a 14% increase from $2.5 billion.
As a result, GM’s stock rose nearly 5% in pre-market trading on Tuesday and has gained over 37% since the beginning of the year. The company also declared a third-quarter cash dividend, contributing to the stock’s positive performance.
In a message to shareholders, CEO Mary Barra highlighted the success of the company’s gas-powered trucks and SUVs, announcing plans to launch eight new or redesigned models in North America. Additionally, Barra shared updates on the electric Chevrolet Equinox, emphasizing GM’s commitment to careful volume growth in its electric vehicle (EV) initiatives. However, earlier this month, she acknowledged that GM would not meet its target of producing 1 million EVs in North America by the end of 2025 due to market slowdowns, while noting a growth in EV sales last quarter.
Barra also addressed changes in GM’s self-driving unit, Cruise, which will no longer pursue the development of its Origin vehicle following setbacks. Instead, Cruise will focus on testing the next-generation Chevrolet Bolt in Texas and Arizona, allowing the company to optimize resources and reduce costs. GM incurred a $600 million charge related to the halted production of the Origin vehicle.
In a call with analysts, Barra assured stakeholders that the company’s vision for transforming mobility through autonomous technology remains intact, with ongoing advancements bringing Cruise closer to its goals. Furthermore, GM is working to restructure its joint venture in China with SAIC Motor amidst ongoing losses, reporting a $104 million loss for the second quarter. According to Automotive News, SAIC-GM reduced production by 70% in June and delivered only 26,000 vehicles, a 50% decline year-over-year.