General Motors, a Detroit-based automaker, exceeded the expectations of Wall Street in the third quarter, resulting in an increase in key guidance targets for the year 2024. The company’s performance in the third quarter stood out compared to the average estimates compiled by LSEG. Earnings per share were reported at $2.96 adjusted, surpassing the expected $2.43, while revenue reached $48.76 billion, higher than the anticipated $44.59 billion.
This successful quarter marks the third time this year that GM has revised its guidance after surpassing Wall Street’s projections, particularly driven by its North American operations. GM now anticipates full-year adjusted earnings before interest and taxes to be between $14 billion and $15 billion, or $10 and $10.50 per share. This is an increase from the previous range of $13 billion to $15 billion, or $9.50 and $10.50. Additionally, the company raised its adjusted automotive free cash flow forecast to between $12.5 billion and $13.5 billion, up from $9.5 billion and $11.5 billion.
GM’s net income attributable to common stockholders, excluding certain dividend payouts, was adjusted to be between $10.4 billion and $11.1 billion, or $9.14 and $9.63 per share, compared to the previous guidance of $10 billion to $11.4 billion, or $8.93 and $9.93.
During premarket trading on Tuesday, GM’s shares saw an increase of approximately 3%. The company has consistently exceeded Wall Street’s EPS estimates for nine consecutive quarters and revenue for eight straight quarters.
GM’s strong third-quarter results were supported by robust pricing, which helped offset losses in China and year-over-year cost increases in labor and warranty costs. Despite challenges in China, GM’s North American operations performed exceptionally well, showcasing adjusted earnings before interest and taxes of nearly $4 billion, up 12.9% from the previous year.
The company’s financing arm reported a 7.3% decline in adjusted earnings, while its Cruise autonomous vehicle unit experienced losses of approximately $1.3 billion, including a loss of $383 million in the third quarter.
Looking ahead, GM’s investor day highlighted the company’s expected earnings strength continuing into the next year. Investors are eager to learn more about GM’s funding plans for its Cruise autonomous vehicle unit, details on its China restructuring, and updates on its electric vehicle sales and plans.
As of Monday’s closing, GM’s shares have increased by about 36% this year, reaching $48.93. The company’s stock has been positively impacted by significant buybacks, leading to a 19% reduction in outstanding shares year-over-year.
Stay tuned for further updates on this developing news.
