General Electric fell short of Wall Street’s expectations on by a wide margin on Friday as profits were weighed down by restructuring costs, even as revenue grew.
“It’s a throwaway quarter,” Harbor Advisory’s chief investment officer Jack DeGan said on CNBC’s “Squawk Box.”
Investors are looking ahead to November when the company is expected to provide more detail about its expectations for the future, as it works to reshape its business.
After stripping out restructuring charges, GE earned 29 cents per share from continuing operations in the third quarter, down 9 percent from the same period a year ago. Analysts surveyed by Thomson Reuters expected the company to earn 49 cents per share.
GE revenue rose 14 percent to $33.47 billion, which beat analysts’ expectations of $32.56 billion.
Shares of GE fell more than 5 percent in premarket trading on Friday.
The company cut its guidance for the year, lowering expectations for its 2017 adjusted earnings per share to a range of $1.05-$1.10, from $1.60-$1.70.
GE’s performance was weighed down heavily by its power business, which saw profits decline 51 percent to $611 million, from $1.3 billion at the same time last year.
The company also posted a loss at its oil and gas business. It swung to a loss of $36 million from a profit of $353 million a year ago.
“We are focused on redefining our culture, running our businesses better, and reducing our complexity,” GE CEO John Flannery said in a statement. ” I look forward to meeting with investors in November to update them on our progress.”
The company has seen sweeping personnel changes, including the departure of its CFO, the earlier-than-expected retirement of its chairman, and the addition of Trian Partners CIO Ed Garden to the board.
This was the first quarterly report for GE under Flannery, amidst a year that has seen the company’s stock decline more than 25 percent, as of Thursday’s close at $23.58 per share.
GE’s conference call with investors is scheduled for 8:30 a.m. ET.
In an exclusive interview following the earnings report, Flannery will be on CNBC at 10 a.m. ET to speak with “Squawk on the Street.” This will be Flannery’s first interview since becoming both chairman and CEO.
Source: Investment Cnbc
General Electric posts huge third-quarter miss, shares drop 5%