General Motors has updated several financial projections for 2024 after exceeding Wall Street forecasts in its second-quarter performance.
The automaker now anticipates adjusted earnings for the year to range between $13 billion and $15 billion, an increase from prior expectations of $12.5 billion to $14.5 billion. Additionally, GM has raised its outlook for operating cash flow and earnings per share. However, it slightly adjusted its forecast for net income attributable to shareholders downward, to between $10 billion and $11.4 billion.
For the second quarter, GM reported revenue of $47.9 billion, marking an increase of over 7% from the previous year and surpassing the $45 billion anticipated by analysts, as per FactSet estimates. Earnings per share were reported at $3.06, exceeding the expected $2.71 and representing a 60% increase compared to 2023. The company’s net income also grew by 14%, reaching $2.9 billion, up from $2.5 billion.
Following this report, GM’s stock rose nearly 5% in pre-market trading on Tuesday, adding to a 37% increase in value this year. GM also announced a cash dividend for the third quarter, which contributed to the stock’s upward momentum.
In a letter to shareholders, CEO Mary Barra highlighted the strength of the company’s gas-powered trucks and SUVs while announcing plans to launch eight new or updated compact, mid-size, and full-size models in North America. She emphasized GM’s commitment to expanding production of the electric Chevrolet Equinox and stated, “as excited as we are about our EVs and our early success, we are committed to disciplined volume growth.”
Earlier this month, Barra indicated that GM would not meet its target of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown. The company plans to adapt by “building to demand,” although its EV sales experienced growth last quarter.
Additionally, Barra revealed that Cruise, GM’s self-driving unit, will discontinue its Origin vehicle following operational setbacks from an incident last October. Instead, Cruise will focus on utilizing the next-generation Chevrolet Bolt for testing in Texas and Arizona. GM incurred a $600 million charge related to ceasing production of the Origin in Detroit.
During a call with analysts, Barra expressed that using the Bolt would alleviate regulatory concerns associated with the unique design of the Origin, which lacked a steering wheel. This shift is expected to reduce costs per unit and enhance resource optimization.
“Our vision to transform mobility using autonomous technology is unchanged, and every mile traveled, and every simulation, brings us closer because Cruise is an AI-first company,” Barra stated.
Furthermore, GM is working to restructure its joint venture in China with SAIC Motor amid ongoing losses, reporting a $104 million loss for the second quarter. In June, SAIC-GM reduced production by 70%, delivering 26,000 vehicles, which is a 50% decline compared to the previous year, as reported by Automotive News.