GE slashes its dividend to a penny, says it's reorganizing its struggling power business
General Electric on Tuesday announced third-quarter results that fell short of Wall Street estimates and said it was cutting its dividend and restructructuring its struggling power business. Shares were up less than 1% following the news.
The globally diversified technology and financial services company reported adjusted earnings of $0.14 a share on revenue of $29.57 billion, missing the $0.20 and $30.25 billion that analysts surveyed by Bloomberg were expecting.
GE said that it would slash its dividend to $0.01 a share - from $0.12 - saving it approximately $3.9 billion of cash per year. The company will also take a pre-tax $22 billion non-cash goodwill impairment charge related to GE Power.
""After my first few weeks on the job, it's clear to me that GE is a fundamentally strong company with a talented team and great technology," CEO Larry Culp said in the earnings release.
"However, our results are far from our full potential. We will heighten our sense of urgency and increase accountability across the organization to deliver better results."
It has been a rough year for GE stockholders, who have seen shares plunge more than 35%. After a gain of more than 20% following the naming of Culp as CEO, the stock has proceeded to make new lows. It hit less than $11 a share on Monday, making for the lowest print since the depths of the financial crisis.
