DETROIT — General Motors is raising its 2023 guidance for a second time this year after the automaker reported second-quarter results Tuesday that were up sharply year over year.

The Detroit automaker also said it is increasing cost-cutting measures through next year and now plans to reduce $3 billion in expenditures compared with previous guidance of $2 billion.

GM CFO Paul Jacobson said the reductions will include sales and marketing spending, salary employment, and other costs.

GM shares were initially up following the results but were down by more than 2% in premarket trading ahead of markets opening.

Here’s what GM reported for its second quarter:

• Adjusted earnings per share: $1.91. (This is not comparable to $1.85 analysts expected due to one-time items.)
• Revenue: $44.75 billion vs. $42.64 billion expected, according to Refinitiv consensus estimates

GM’s earnings included an unexpected $792 million charge for new commercial agreements between GM and LG Electronics and LG Energy Solution. The cost is a result of the automaker sharing costs with the companies for a recall of its Chevrolet Bolt EV models in recent years, which were previously expected to be paid by the LG companies.

Taking that charge into account, the company reported adjusted earnings before interest and taxes of $3.23 billion.

On an unadjusted basis, the company reported net income attributable to stockholders of $2.57 billion, or $1.83 per share, up nearly 52% from a year earlier when it earned $1.69 billion, or $1.14 per share.

Revenue during the quarter jumped 25% compared to $35.76 billion a year earlier.

For the full year, GM is raising its adjusted earnings expectations to a range of $12 billion and $14 billion, up from a previous range of $11 billion to $13 billion. GM also raised expectations for adjusted automotive free cash flow to a range of $7 billion and $9 billion, up from $5.5 billion and $7.5 billion, and for net income attributable to stockholders of $9.3 billion to $10.7 billion, compared to the previous outlook of $8.4 billion to $9.9 billion.

Jacobson said the raise is a result of stronger-than-expected pricing, demand and capital discipline.

However, the guidance raise is contingent on GM successfully negotiating new labor agreements with the United Auto Workers and the Canadian Unifor unions this year without a work stoppage or strike. The UAW has new leadership that has publicly been far more confrontational than prior union officers. The current contracts covering roughly 150,000 union workers for the Detroit automakers are set to expire Sept. 14.

“We have a long history of negotiating fair contracts with both unions that reward our employees and support the long-term success of our business. Our goal this time will be no different,” GM CEO Mary Barra said Tuesday in a shareholder letter. “That’s the best possible outcome for all our key stakeholders, including our team, plant communities, dealers, suppliers and investors.”

A work stoppage would add to the auto industry’s yearslong production problems results from the coronavirus pandemic and significant supply chain constraints such as semiconductor chips.

During the last round of bargaining in 2019, a breakdown in negotiations between the Detroit automakers and UAW led to a national 40-day strike against GM. The automaker has said the strike cost it about $3.6 billion that year.

For GM specifically, a work stoppage could cost it hundreds of millions of dollars a week and delay the production ramp-up of its new electric vehicles, which the automaker has already been slow to produce. Jacobson said GM achieved North American production of 50,000 EVs during the first half of the year, however acknowledged “it’s been a little bit challenging.”

He said the automaker will disclose more about the slow production of its new EVs during an analyst call Tuesday.

Prior to reporting results Tuesday, GM’s earnings beat expectations 86% of the time, according to Bespoke. However, the stock only averages a 0.17% gain on earnings day.

Shares of GM are up roughly 16% this year. They closed Monday at $39.30 per share — off from a 52-week high of $43.63 per share, notched in February.