US industrial conglomerate General Electric today reported a 28% drop in quarterly profit, as weakness in power and renewables energy offset gains in its aviation, oil and gas and healthcare units.
GE affirmed its full-year adjusted EPS target of $1-1.07 a share, but cut its annual cash target to $6 billion from a range of $6-7 billion.
Its shares have dropped 49 percent in the past year. Though investors are still interested in GE, many want to see the power and capital units stabilise and even improve before buying the stock, analysts have said.
Losses widened at GE Capital, the company's financing arm, to $207m compared with a loss of $172m a year ago.
Power unit profit fell 58% in the quarter, to $421m from $994m, as orders fell 26% to $7.4 billion.
A decade and a half ago, GE was the world’s most valuable public company.
But it foundered in several key industrial markets in recent years, and a diversion into financial services steered it into the eye of the global financial storm in 2008.
Faced with weak profits and calls to be broken up, the 126-year-old company is aggressively cutting costs, selling businesses and trying to strengthen its balance sheet under new managers and a new board.
GE's earnings from continuing operations attributable to GE shareholders fell to $736m, or 8 cents a share, in the second quarter ended June 30, from $1.03 billion, or 12 cents a share, a year earlier.
Total revenue rose to $30.1 billion from $29.1 billion.
On an adjusted basis, which excludes certain pension and restructuring costs, GE earned 19 cents a share, down from 21 cents a year ago.
Analysts had expected GE to post adjusted earnings of 17 cents a share, according to Thomson Reuters, and had cut their estimates after weak first-quarter results.
