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General Motors is raising a number of financial targets for 2024 after smashing past Wall Street’s expectations for its second quarter.
The Detroit automaker raised its expected adjusted earnings for the year to between $13 billion and $15 billion, up from $12.5 billion to $14.5 billion, and raised its targets for operating cash flow and earnings per share. Expectations for net income attributable to shareholders was lowered by less than 1%, to between $10 billion and $11.4 billion.
Revenue for the second quarter hit $47.9 billion, a more than 7% increase compared to the previous year and above the $45 billion expected by Wall Street, according to FactSet estimates. Earnings per share were $3.06, above the $2.71 per share expected by analysts and 60% greater than in 2023. Net income grew 14% to $2.9 billion, up from $2.5 billion.
GM stock jumped almost 5% in pre-market trading Tuesday. The stock has climbed more than 37% this year. After trading closed Monday, GM declared a third-quarter cash dividend, which gave the stock a boost.
In a letter to shareholders, CEO Mary Barra touted the success of its gas-powered trucks and SUVs, adding that the company is in the process of launching eight new or redesigned compact, mid-size, and full-size models in North America. Barra also noted that GM is scaling production of the electric Chevrolet Equinox, telling shareholders that “as excited as we are about our EVs and our early success, we are committed to disciplined volume growth.”
Barra earlier this month said GM won’t hit its goal of producing 1 million electric vehicles in North America by the end of 2025, citing a market slowdown. The company has said it will be flexible and “build to demand,” although its EV sales did grow last quarter.
The CEO also announced that Cruise, GM’s self-driving unit that was forced to rollback its operations after an incident last October, would ditch its Origin vehicle. Cruise will instead focus on using the next-generation Chevrolet Bolt as the company tests its vehicles in Texas and Arizona. GM took a $600 million charge related to the halt in production of the Origin in Detroit.
During a call with analysts, Barra said using the Bolt will alleviate any concerns regulators had about the Origin’s unique design — like its lack of a steering wheel. The change will also lower per unit costs and help GM optimize resources, she added.
“Our vision to transform mobility using autonomous technology is unchanged, and every mile traveled, and every simulation, brings us closer because Cruise is an AI-first company,” Barra said in a statement.
GM is also attempting to restructure its joint venture in China with SAIC Motor as it continues to take losses; the company took a $104 million loss for the second quarter. In June, SAIC-GM cut production by 70% and delivered 26,000 vehicles, or 50% less than a year prior, according to Automotive News.