General Motors (GM) Reports Strong First Quarter Results
GM’s Earnings and Revenue Surpass Expectations
General Motors (GM) generated strong first quarter revenue, outperforming Bloomberg’s consensus expectation. The automaker reported top-line revenue of $43.0 billion, a 7% increase compared to the same period last year. The company’s adjusted earnings per share of $2.62 also surpassed estimated EPS of $2.12.
Positive Momentum and Increased Guidance
GM’s positive momentum allowed the company to raise its full-year guidance. The automaker now foresees adjusted EBIT of $12.5 billion to $14.5 billion, while adjusted EPS is expected to range between $9.00 and $10.00. Moreover, GM improved its automotive operating cash flow and adjusted automotive free cash flow forecasts.
“As we continue to strengthen our ICE portfolio, scale EVs and reinvest in the business, we are very focused on capital efficiency, enhancing profitability and free cash flow, and we will continue to take steps to create shareholder value,” emphasized GM CEO Mary Barra.
Impressive EV Outlook
GM reiterated its positive outlook on electric vehicles (EVs), expressing confidence in achieving “positive variable profit” in its EV business in the latter part of 2024. The company’s projection of approximately 200,000 EVs sold by the end of the year informs its expectation of a 60-point improvement in EV business EBIT margin from 2023 to 2024.
GM anticipates the inclusion of clean energy tax credits to contribute to a “mid-single digit EBIT margin” by 2025.
Q1 Sales Performance and Future EV Models
Although GM’s overall Q1 sales in the US experienced a slight decline compared to the previous year, the company’s retail sales exhibited a promising 6% increase. GM delivered 594,233 vehicles in the quarter, retaining its position as the leading automaker in the US.
GM reported significant EV sales gains, particularly with the Cadillac LYRIQ, Hummer EV, and the fleet-only available Silverado EV. The company plans to begin delivering the Silverado EV to retail customers in the upcoming months. Chevrolet’s Blazer EV sold only 500 units in the quarter after a temporary halt in sales due to a software issue. The highly anticipated Equinox EV will go on sale in the second quarter at a starting price of approximately $35,000.
GM’s Commitment to R&D and Autonomous Driving
GM’s successful revenue growth is attributed to leveraging its traditional gas-powered business, allowing for gradual EV business expansion while achieving strong margins and cash flows, according to GM CEO Mary Barra.
In addition, Cruise, GM’s autonomous driving unit, is restarting operations in the Phoenix area after car-related incidents resulted in a temporary shutdown. Cruise aims to continue developing safe and reliable autonomous vehicles in the future.
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