General Motors has increased several financial projections for 2024 after surpassing Wall Street’s expectations in its second quarter results. The Detroit-based automaker has raised its anticipated adjusted earnings for the year to a range of $13 billion to $15 billion, up from the previous forecast of $12.5 billion to $14.5 billion. It has also increased 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.
For the second quarter, GM reported revenues of $47.9 billion, which represents a more than 7% increase compared to last year and exceeds Wall Street’s expectations of $45 billion, according to FactSet. Earnings per share reached $3.06, surpassing the anticipated $2.71, and reflecting a 60% increase from the same period in 2023. Net income rose by 14%, reaching $2.9 billion compared to $2.5 billion from the prior year.
In pre-market trading on Tuesday, GM’s stock surged nearly 5%, contributing to a more than 37% increase in stock value this year. Following the close of trading on Monday, GM announced a cash dividend for the third quarter, which further supported the stock’s performance.
CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs in a letter to shareholders, noting the company’s plans to launch eight new or redesigned models in North America. She also emphasized GM’s commitment to scaling production of the electric Chevrolet Equinox, while remaining focused on disciplined volume growth, despite acknowledging earlier this month that GM will not meet its target of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown.
Additionally, Barra indicated that Cruise, GM’s self-driving subsidiary, will abandon its Origin vehicle in favor of the next-generation Chevrolet Bolt as it tests its technology in Texas and Arizona. GM incurred a $600 million charge due to the halt in production of the Origin in Detroit. During an analyst call, Barra noted that using the Bolt would address regulatory concerns about the Origin’s unique design, which lacks a steering wheel, and would help reduce costs and optimize resources.
Lastly, GM continues to restructure its joint venture in China with SAIC Motor as it faces ongoing financial losses, reporting a $104 million loss for the second quarter. In June, SAIC-GM reduced production by 70% and delivered 26,000 vehicles, representing a 50% decline compared to the previous year.