General Electric quarterly earnings: Sales very weak, large loss, earnings without special items acceptable

General Electric quarterly earnings have just been published. Here are the most important key figures.

Revenues totaled 31.4 billion dollars (prior-year quarter 33.1/expected range of 31.8-37). This means that sales are even worse than the lowest expectation.

Non-GAAP (!) loss per share was $1.23 (prior-year quarter: +0.46/expected +0.28).

Adjusted for various special charges (see third chart below), earnings per share were +$0.27.

Some days ago GE announced a $6.2 billion write-off in the Group’s insurance segment – probably to prepare for today’s shock in the official quarterly figures.

The industrial segments deliver all decent profits (even if the energy segment is still weak). Only the GE Capital division (with the insurance business) contributed with a substantial loss of USD 6.38 billion in the last quarter – but this loss was obviously not deducted from the non-GAAP figures. That’s why the non-GAAP data looks so catastrophic.

The share price was up 1.5% on the pre-market trading some moments ago. From 8:30 EST (14:30 CET) on the data will be discussed with analysts. It´s therefore quite possible that there will be some progress in interpreting these data before the market opens.

In 2018, the focus will be mainly on cost reductions, according to GE’s current wording (a lot of factory closures):

GE Chairman and CEO John Flannery said, “In the fourth quarter, EPS was at the low-end of guidance, excluding insurance-related items, U.S. tax reform, and industrial portfolio actions. Cash performance was above expectations and our visibility and execution on cash is improving.  Aviation and Healthcare had strong performances in the quarter. Power was down significantly and we expect market challenges to continue. Our results this quarter demonstrate some of the early progress we are seeing from our key initiatives. The team is focused on operational execution, capital allocation and deep cost reduction to position us for continued improvement in 2018.”

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