General Motors has increased several financial forecasts for 2024 after exceeding Wall Street’s expectations in its second quarter results. The automaker has raised its projected adjusted earnings for the year to a range of $13 billion to $15 billion, previously set between $12.5 billion and $14.5 billion. Additionally, GM has updated 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, a decrease of less than 1%.
In the second quarter, GM reported revenues of $47.9 billion, a growth of over 7% from the previous year, surpassing the expected $45 billion according to FactSet estimates. The company’s earnings per share reached $3.06, exceeding the anticipated $2.71 per share and showing a 60% increase from 2023. Net income for the quarter rose by 14%, totaling $2.9 billion, compared to $2.5 billion last year.
As a result of these positive financial reports, GM’s stock rose nearly 5% in pre-market trading on Tuesday, marking an increase of more than 37% since the start of the year. Following Monday’s trading closure, GM declared a cash dividend for the third quarter, further boosting investor sentiment.
In a letter to shareholders, CEO Mary Barra highlighted the success of GM’s gasoline-powered trucks and SUVs, mentioning the upcoming launch of eight new or redesigned models across various sizes in North America. Barra also discussed the ramp-up in production of the electric Chevrolet Equinox, emphasizing the company’s commitment to disciplined growth despite early successes in the electric vehicle (EV) segment.
Earlier this month, Barra acknowledged 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. However, the company plans to adapt to demand, while reporting an increase in EV sales last quarter.
Barra also provided updates on Cruise, GM’s self-driving unit, which faced operational cutbacks after an incident last year. The company will discontinue its Origin vehicle and instead use the next-generation Chevrolet Bolt for testing in Texas and Arizona. GM incurred a $600 million charge due to the suspension of Origin production in Detroit.
During an analyst call, Barra explained that utilizing the Bolt would address regulatory concerns associated with the Origin’s unconventional design, such as its lack of a steering wheel. She noted that this change would also reduce costs and allow GM to better allocate its resources.
Barra reiterated GM’s commitment to transforming mobility through autonomous technology, stating that every step taken brings the company closer to that vision. Additionally, GM is working to restructure its joint venture in China with SAIC Motor, which has continued to record losses, including a $104 million loss in the second quarter. In June, SAIC-GM reduced production by 70% and delivered 26,000 vehicles, representing a 50% decline from the previous year.