General Motors Co. (GM) announced a higher than expected profit and nearly unchanged revenues in its Q4 results. The automobile giant also provided a promising earnings per share outlook for fiscal 2024, exceeding both last year's values and current market expectations.
GM shares saw an increase of over 9%, reaching $38.67, on the New York Stock Exchange.
Chair and CEO of GM, Mary Barra, asserted her confidence in the company's strong financial prospects for 2024, leveraging the progress and learning experiences of 2023. Barra also anticipated GM's Electric Vehicle (EV) division to be a key contributor to their growth, particularly in the latter half of the year, fostered by promising EV demand, production augmentation, high vehicle interest, lower commodity pricing, and other factors.
GM also detailed its financial targets for fiscal 2024, including a net income attributable to stockholders ranging from $9.8 to $11.2 billion, an increase from last year's $10.1 billion. The company's earnings per share are expected to reach $8.50 to $9.50 on both reported and adjusted bases. GM recorded earnings of $7.32 per share (reported) and $7.68 per share (adjusted) in 2023.
The majority of analysts have predicted a lower than anticipated earning per share for the year, averaging at $7.83. These estimates often disregard certain special items.
GM's 2024 projection also considers the impact of their expedited share repurchase program, initiated in November 2023, estimated at $1.45 per share. Moreover, GM plans to spend between $10.5 and $11.5 billion on capital investments.
Reflecting on 2023, GM saw a 10% YoY growth in total company revenue, which totaled $171.84 billion. In the U.S., GM positioned itself as the top seller, with every brand operating under GM recording increased sales. GM enhanced its market share with robust margins, supported by stable pricing and incentives that significantly undercut industry averages.
In Q4, GM's net income to stockholders was $2.1 billion or $1.59 per share, demonstrating a 5.2% increase from the preceding year's Q4. Adjusted earnings recorded were $1.24 per share, as opposed to the previous year's $2.12 per share. This surpasses analyst expectations of $1.16 per share for the period.
Adjusted EBIT decreased by 53.8% to $1.76 billion from the previous year's $3.80 billion, while the adjusted EBIT margin was 4.1%, representing a 4.7 percentage point dip. However, company revenue for the quarter dropped slightly by 0.3% to $42.98 billion from $43.11 billion in the prior year, exceeding the market's revenue expectations of $38.97 billion.
