General Motors (GM) has revised its financial projections for 2024 after exceeding Wall Street’s expectations for the second quarter. The Detroit-based automaker increased its forecasted adjusted earnings for the year to between $13 billion and $15 billion, up from a previous range of $12.5 billion to $14.5 billion. The company also raised its targets for operating cash flow and earnings per share, while slightly reducing expectations for net income attributable to shareholders, which now sits between $10 billion and $11.4 billion.
In the second quarter, GM reported revenue of $47.9 billion, representing over a 7% increase compared to the same period last year and surpassing Wall Street’s expectation of $45 billion. The earnings per share came in at $3.06, exceeding analysts’ forecasts of $2.71 and reflecting a 60% year-over-year increase. Net income rose by 14%, reaching $2.9 billion, compared to $2.5 billion in 2023.
Following the report, GM shares surged nearly 5% in pre-market trading on Tuesday, contributing to a more than 37% increase in the stock’s value this year. The company also declared a third-quarter cash dividend after the market closed on Monday, further propelling the stock.
In a letter to shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs, announcing plans to launch eight new or redesigned models in North America. She emphasized the company’s commitment to increasing production of the electric Chevrolet Equinox and acknowledged the early success in electric vehicles (EVs), while also stating that GM remains dedicated to disciplined volume growth.
Earlier this month, Barra noted that GM is unlikely to meet its goal of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown. The company plans to adapt and “build to demand,” yet it did experience growth in EV sales last quarter.
Additionally, Barra revealed that Cruise, GM’s self-driving unit that paused operations after an incident last October, will no longer pursue its Origin vehicle. Instead, Cruise will concentrate on utilizing the next-generation Chevrolet Bolt for vehicle testing in Texas and Arizona. GM incurred a $600 million expense related to the stoppage of the Origin’s production in Detroit.
During an analysts’ call, Barra explained that switching to the Bolt would address regulatory concerns regarding the Origin’s unconventional design, such as its absence of a steering wheel. This strategic shift is expected to reduce costs per unit and optimize GM’s resources.
Barra reiterated that GM’s aim to revolutionize mobility with autonomous technology remains steadfast, asserting that each mile traveled and every simulation moves Cruise closer to its objectives. Furthermore, GM is working to restructure its joint venture in China with SAIC Motor due to ongoing losses, with the company reporting a $104 million loss in the second quarter. In June, SAIC-GM cut production by 70%, delivering 26,000 vehicles, a 50% decline compared to the previous year.