General Motors is increasing several financial targets for 2024 after exceeding Wall Street expectations for its second quarter results. The automaker has adjusted its projected adjusted earnings for the year to range between $13 billion and $15 billion, an increase from the previous forecast of $12.5 billion to $14.5 billion. Furthermore, GM has raised its targets for operating cash flow and earnings per share, while slightly lowering the expectations for net income attributable to shareholders to between $10 billion and $11.4 billion.
In its second quarter, GM reported revenue of $47.9 billion, reflecting a more than 7% increase compared to the same period last year and surpassing Wall Street’s expectation of $45 billion, according to FactSet estimates. Earnings per share stood at $3.06, exceeding the anticipated $2.71 and representing a 60% increase from 2023. The company’s net income rose by 14% to $2.9 billion, up from $2.5 billion.
Following this announcement, GM’s stock surged nearly 5% in pre-market trading, contributing to an overall increase of more than 37% for the year. Additionally, GM declared a third-quarter cash dividend after market close on Monday, which also positively impacted the stock.
In a letter to shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs, noting that the company plans to launch eight new or redesigned models in North America. She also emphasized the scaling of production for the electric Chevrolet Equinox, stating that while the company is excited about its electric vehicles, it remains committed to 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, attributing the setback to a market slowdown. The company has indicated a willingness to adjust production based on demand, although its electric vehicle sales did increase in the last quarter.
Moreover, Barra announced that Cruise, GM’s self-driving unit which had previously scaled back operations following an incident last October, would abandon the development of its Origin vehicle. Instead, Cruise will focus on utilizing the next-generation Chevrolet Bolt for testing in Texas and Arizona. GM recorded a $600 million charge related to the discontinuation of the Origin production in Detroit.
During a conference call with analysts, Barra stated that using the Bolt would address any regulatory concerns regarding the Origin’s unconventional design, such as the absence of a steering wheel. This change is expected to reduce costs and enhance GM’s resource allocation.
“Our vision to transform mobility through autonomous technology remains unchanged,” Barra stated. “Every mile traveled and every simulation brings us closer, as Cruise continues to operate as an AI-first company.”
Additionally, GM is working to restructure its joint venture in China with SAIC Motor, which has incurred losses. The company reported a $104 million loss for the second quarter. In June, SAIC-GM significantly reduced production by 70%, delivering 26,000 vehicles—50% fewer than the previous year, as reported by Automotive News.