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On Tuesday, General Motors (NYSE:GM) did a lot better than expected during the first three months of 2024. The Detroit automaker also lifted its 2024 guidance fueled by strong truck sales in North America.
During the first three months of the year, GM reported revenue rose 7.6% YoY to $43.01 billion, surpassing LSEG’s estimate of $41.92 billion. Net income grew 26% to $2.95 billion with adjusted earnings amounting to $2.62 per share, also surpassing LSEG’s estimate of $2.15. When excluding some dividend payouts, net income attributable to stockholders rose 24.4% to $2.98 billion, or $2.56 per share.
GM’s operations in North America were the star of the Q1 show.
The division reported adjusted earnings rose 7.4% YoY to $3.84 billion. With increased retail sales and steady pricing of vehicles, the division achieved an adjusted profit margin of 10.6%.
North America’s success succeeded to offset the loss from weak divisions.
On the other hand, GM’s divison in China reported a loss of $106 million, along with $10 million in other international markets. While highly profitable trucks continue to enjoy strong sales.
EV plans remain on track.
The EV universe was shaken when Tesla Inc (NASDAQ:TSLA) reported its first YoY global sales drop since the pandemic. Moreover, Tesla also warned a year of slower growth is ahead. GM is among the many automakers that scaled down its EV ambitions.
But, GM is still aiming for an output in the range between 200,000 and 300,000 EVs this year. Moreover, GM forecasted its North American EV business will become profitable in the second half of the year, which would be a major milestone.
On the back of strong results, GM lifted its full-year guidance.
GM previously guided for 2024 adjusted EBIT in the range between $12 billion and $14 billion. It now raised its guidance on both ends for half a billion. It also raised its 2024 EPS from a previous range between $8.50 and $9.50to a new range between $9.00 and $10.00 per share. GM also raised its automotive operating cash flow forecast that is now between $18.3 billion and $21.3 billion, while guiding for adjusted automotive free cash flow in the range between $8.5 billion and $10.5 billion.
GM’s first quarter results reflect resilience and strength.
Despite the increased labor costs from new union contracts, higher interest rates its customers are facing when buying cars and its EV business not being profitable yet, GM made more than expected. But when it comes to EVs, tonight will be the night of valuable insights for the industry as Tesla is due to report earnings. Even the mighty Tesla is undoubtedly feeling the pinch from the EV slowdown, along with intensifying competition in China.
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This article is from an unpaid external contributor. It does not represent Benzinga's reporting and has not been edited for content or accuracy.
