General Motors has revised its financial forecasts for 2024 after exceeding Wall Street expectations in the second quarter. The Detroit-based automaker has increased its projected adjusted earnings for the year to a range of $13 billion to $15 billion, up from the previous estimate of $12.5 billion to $14.5 billion. It has also raised its targets for operating cash flow and earnings per share, although the forecast for net income attributable to shareholders has been reduced slightly, now estimated between $10 billion and $11.4 billion.
In the second quarter, GM reported revenue of $47.9 billion, marking a more than 7% year-over-year increase and surpassing the $45 billion analysts anticipated. Earnings per share reached $3.06, exceeding expectations of $2.71 and reflecting a 60% increase compared to 2023. The company’s net income rose 14% to $2.9 billion, up from $2.5 billion.
In pre-market trading on Tuesday, GM’s stock surged nearly 5%. The stock has risen over 37% so far this year. Following the market close on Monday, GM also announced a cash dividend for the third quarter, contributing to the stock’s upward momentum.
CEO Mary Barra highlighted the success of GM’s gasoline-powered trucks and SUVs in a letter to shareholders, while also emphasizing the launch of eight new or redesigned models in North America. She discussed the ramp-up of production for the electric Chevrolet Equinox, stating that the company is excited about its electric vehicle (EV) prospects but remains focused on disciplined growth.
Earlier this month, Barra mentioned that GM would not meet its goal of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown, but noted that EV sales had increased in the last quarter.
Furthermore, Barra announced a strategic shift for Cruise, GM’s self-driving division, which will abandon the Origin vehicle project following production setbacks from an incident last October. The company plans to concentrate on the next-generation Chevrolet Bolt for testing its autonomous vehicles in Texas and Arizona, which also involves a $600 million charge associated with ceasing Origin production in Detroit.
During an analyst call, Barra expressed that the decision to utilize the Bolt addresses regulatory concerns regarding the Origin’s design, helping to reduce costs and optimize efficiency. She reaffirmed GM’s commitment to using autonomous technology to transform mobility and indicated that progress is being made with every mile traveled and every simulation completed.
Additionally, GM is working to restructure its joint venture with SAIC Motor in China, as the company continues to report losses. For the second quarter, GM incurred a loss of $104 million related to this venture. In June, SAIC-GM reduced production by 70% and delivered 26,000 vehicles, which is 50% less than the previous year’s figures.