General Motors (GM) posted strong results on Tuesday, and its shares rose by 5 percent in premarket trading. The US automaker exceeded forecasts and also raised its outlook. Despite the general slowdown in electric vehicle maker Tesla sales and the electric vehicle market, GM remains optimistic about its electric vehicle business in the year’s second half.
According to Bloomberg data, General Motors reported revenue of $43.0 billion, while Wall Street analysts estimated $42.09 billion. The company also reported the same revenue of $43 billion in the last quarter. Sales have risen by 7 percent compared with the same quarter in 2023.
The outlet’s data reported estimated earnings per share of $2.12, with adjusted earnings before interest and taxes (EBIT). However, GM reported adjusted earnings per share of $2.62. Operating profit for the first quarter was $3.7 billion, while analysts predicted $3.12 billion.
GM has also raised its outlook for the year. The new guidance is a full-year adjusted EBIT of $12.5 billion to $14.5 billion, from the earlier $12 billion to $14 billion. GM previously said that full-year EPS would be between $8.50 and $9.50, but it has now raised it to $9.0 to $10.0.
General Motors also increased its automotive operating cash flow outlook and adjusted its free cash flow.
GM CEO Mary Barra discussed the company’s plans to strengthen its ICE portfolio, scale EVs, and reinvest in the business.
The company has acknowledged that electric vehicle sales have fallen but has a positive outlook on EV sales as it has different products at different costs.
CWEB analysts believe that GM stock is on hold as the company’s projects are positive. However, electric vehicle sales have not met expectations, nor is the electric grid geared up to deal with a deluge of charging in several states across the US. It needs to be strengthened to make EVs and their charging capacities attractive to American consumers. Electric vehicle sales might increase, but states’ total adoption and push will take time as charging services must be improved.
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