General Motors has revised its financial forecasts for 2024 following a strong performance that exceeded Wall Street’s predictions for the second quarter.
The automaker based in Detroit has increased its adjusted earnings guidance for the year to a range of $13 billion to $15 billion, up from the previous projection of $12.5 billion to $14.5 billion. It has also raised 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.
In the second quarter, GM reported revenues of $47.9 billion, which represents a more than 7% increase from the same period the previous year and surpasses Wall Street’s expectation of $45 billion, according to estimates from FactSet. Earnings per share reached $3.06, exceeding the anticipated $2.71 and reflecting a 60% rise compared to 2023. The company also saw a 14% increase in net income, totaling $2.9 billion, compared to $2.5 billion last year.
Following this announcement, GM’s stock experienced a nearly 5% rise in pre-market trading on Tuesday, marking over a 37% increase for the year. On Monday, GM also declared a cash dividend for the third quarter, further boosting investor confidence.
In her letter to shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs, noting that the company is on the verge of launching eight new or redesigned models in North America, across compact, mid-size, and full-size categories. She emphasized that GM is ramping up production of the electric Chevrolet Equinox while also remaining dedicated to disciplined volume growth.
Earlier this month, Barra acknowledged that GM would fall short of its target of producing 1 million electric vehicles in North America by the end of 2025, attributing this to a slowdown in the market. However, she noted that EV sales had seen growth in the last quarter.
Barra also announced changes to GM’s self-driving unit, Cruise, which had to scale back operations after an incident last October. The project will no longer pursue the Origin vehicle and will instead utilize the next-generation Chevrolet Bolt for testing in Texas and Arizona. This transition is expected to address regulatory concerns regarding the Origin’s unconventional design and will help reduce costs while optimizing resources.
Barra reaffirmed GM’s commitment to transforming mobility through autonomous technology, stating that each mile and simulation brings the company closer to achieving its goals.
Additionally, GM is working on restructuring its joint venture in China with SAIC Motor, which has been experiencing financial losses; the company reported a $104 million loss in the second quarter. In June, SAIC-GM significantly reduced its production by 70%, resulting in the delivery of only 26,000 vehicles, a 50% decrease from the previous year, as reported by Automotive News.