NEW YORK – General Electric Co. posted lower overall revenue and profit in the third quarter, but improving sales of complex industrial equipment gave hope to investors that the companys transformation of its business is succeeding.
GE said Friday that net income fell 9 percent to $3.19 billion and revenue fell 1 percent to $35.73 billion in the third quarter. In last years comparable quarter, the company earned $3.49 billion on revenue of $36.3 billion. GEs earnings per share dropped to 31 cents, from 33 cents last year.
Still, the companys results exceeded Wall Street expectations on the strength of 11 percent growth in profit at its industrial divisions – those that make aircraft engines, CT-scanners, gas turbines, locomotives and oil and gas drilling equipment.
Adjusted to remove the effects of restructuring and other charges, the company said it earned 40 cents a share. Analysts had expected GE to earn 35 cents a share.
GE shares rose 4.2 percent, to $25.73, in afternoon trading to the highest level since September 2008. Back then, shares were plummeting on concerns that GE would not be able to survive intact during the financial crisis because of its enormous banking division.
GE has since sold or reduced the size of its banking operations and other non-industrial businesses such as NBC Universal. The company, which has operations in Fort Wayne, hasnt yet fully replaced the lost revenue and profit. GE Capitals revenue slipped 5 percent in the third quarter, pulling down the companys overall revenue.
But GE has worked to grow the parts of its business that build and service equipment, products and services sold to utilities, hospitals, oil and gas drillers and aircraft manufacturers around the world. Sales and profit from its industrial units – which both GE and investors are most concerned about – improved.
Our business lines are in big infrastructure, the stuff that companies and countries are investing in, Chief Financial Officer Jeff Bornstein said.