Industrial conglomerate General Electric Co. on Friday reported a decline in third-quarter profit, but strong performances from its core units helped the company top Wall Street expectations.
Jeff Immelt, chairman and CEO of General Electric. GE
General Electric has been making a push to focus on industrial businesses _ making large, complicated equipment for other companies _ and shrinking its other businesses that focus on finance. The largest change involves selling most of GE Capital's assets, along with $26.5 billion in real estate assets.
The Fairfield, Connecticut-based company said profit fell 29 percent to $2.51 billion, or 25 cents per share. Meanwhile, revenue fell 1 percent to $31.68 billion.
Earnings, adjusted for non-recurring costs and to account for discontinued operations, came to 32 cents per share. That topped Wall Street expectations, with the average estimate of 11 analysts surveyed by Zacks Investment Research for earnings of 26 cents per share.
The industrial conglomerate posted revenue of $31.68 billion in the period, though revenue from its industrial and verticals units only reached $27.9 billion. Eleven analysts surveyed by Zacks expected $28.67 billion.
During the quarter, the company's power and water division saw revenue rise 1 percent to $6.46 billion. The unit, which makes power generators and related equipment, is the industrial core's largest revenue driver. Meanwhile, revenue rose 5 percent to $6 billion in the aviation unit. Transportation revenue rose 3 percent to $1.59 billion and revenue rose 8 percent to $2.29 billion in the appliances unit.
The oil and gas unit continues to be weighed down by low oil prices. Revenue fell 16 percent to $3.87 billion.
In a statement, Chairman and CEO Jeff Immelt said the company's exit plan for GE Capital is ahead of plan. Including the recently announced sale of $30 billion in commercial lending assets, the company has $126 billion in total signed deals to date, he said.
The stock rose 8 cents to $28.11 in premarket trading 45 minutes before the market open.
GE shares have climbed 11 percent since the beginning of the year, while the Standard & Poor's 500 index has dropped roughly 2 percent. The stock has increased 15 percent in the last 12 months. Oil and gas revenue fell 16 percent, weighed down by lower oil prices. (AP)