GE Earnings Disaster

GE’s earnings miss spooked the market, because it showed that Jack Welch’s strategy of morphing an industrial giant into a finance company was a mistake.

The sharpest drop in segment profit came in the conglomerate’s financial divisions, with commercial finance down 20 percent and GE Money consumer finance down 19 percent. GE’s finance arms make commercial and consumer loans, including financing purchases by corporations and individuals.

The good news is that the industrial assets are big enough that they will be the core of GE’s future. The Green Infrastructure business overseas was up 17%, which syncs up with my post of yesterday.

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0 Responses to GE Earnings Disaster

  1. rhb says:

    It may be that the economic news is beginning to feel like the news from Iraq. Since their is no transparency in either, I can only guess at what the implications of news from their fronts can mean. I’m getting tired of the guessing games. At the same time, the report you sight is fairly specific about the losses, and the size of the profits, and the change in the stock value, so this info should mean something but it really doesn’t. GE will go on, tomorrow it will be Petraeus, the next the Olympic torch, and so on. How long a year do you think 1984 will really be?

  2. rhb says:

    “GE reported a net profit of $4.3 billion, or 43 cents per diluted share, compared with $4.57 billion, or 44 cents, a year earlier. Revenue rose 7.8 percent to $42.24 billion.” How depressing it must be.

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