Shares of General Motors (NYSE:GM) surged 8% on Tuesday after the firm posted better-than-expected fourth-quarter results. Revenue of $42.98 billion beat Wall Street’s estimates of $38.67 billion by 11.2%, while earnings per share of $1.24 beat expectations by 7%.
Expectations were low going into Q4 earnings. General Motors has been grappling with a slowdown in China-based sales, and Wall Street’s revenue expectations represented a 10.4% year-over-year decline. GM has also been grappling with recent controversies involving its Cruise self-driving vehicle. On Jan. 25, the U.S. Department of Justice and the Securities and Exchange Commission (SEC) announced they were opening a probe into an October crash, where a self-driving Cruise vehicle struck a pedestrian and dragged her. The robo-taxi operation has already faced more than $8 billion in losses.
The Q4 revenue uplift comes as encouraging news for investors, pushing GM’s year-to-date return to 5.9%, compared to the S&P 500’s 3.4%.
For 2024, GM anticipates a net income range between $9.8 billion and $11.2 billion, and an adjusted EBIT between $12 billion and $14 billion. The company estimates EPS for 2024 to fall between $8.50 and $9.50. Anticipated capital spending is expected to reach between $10.5 billion and $11.5 billion, including investments in GM’s battery cell manufacturing joint ventures.
GM manufactures and markets vehicles globally under several brands, including Buick, Cadillac, Chevrolet, and GMC. Its financial services arm, GM Financial, provides automotive financing. Despite recent hardships, GM continues to pursue developing autonomous vehicle technology under its Cruise segment and expansion in connected vehicle services. Successful progress and innovations in these areas are anticipated to shape the company’s future growth.
On the date of publication, Thomas Yeung owned shares of General Motors. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
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