By Saabira Chaudhuri
General Electric Co.'s (GE) second-quarter earnings fell 18% as the conglomerate posted a slight drop in infrastructure orders and lower revenue from its lending unit.
Prior to the report, analysts at J.P. Morgan had warned the company would see orders fall for its wind business as U.S. customers have already booked most of their turbine orders. It also noted that a big air show wouldn't occur until the third quarter, hurting results from the conglomerate's aviation business.
Friday, GE said its infrastructure orders were $23.1 billion, down 1% primarily driven by a 37% decrease in orders for wind turbines. However, orders were up 8% on a year-to-date basis.
The company said revenue from its industrial businesses, which include energy infrastructure and aviation, rose to $25.04 billion in the second quarter, an 8.8% jump. Profit from the businesses was up 6.8% to $3.74 billion.
GE has worked since the financial crisis to slim down its lending unit GE Capital by selling assets and allowing its loan portfolio to shrink. In June, The Wall Street Journal reported that top executives are looking at going further, including possibly selling businesses in GE Capital's consumer-finance portfolio, such as private-label credit cards or showroom financing for products like snowblowers or lawn mowers.
Revenue from GE Capital fell 7.9% to $11.46 billion, while profit rose 31% to $2.12 billion.
GE reported a profit of $3.11 billion, compared with a year-earlier profit of $3.76 billion. Per-share earnings, reflecting the payment of preferred dividends in the prior-year period, declined to 29 cents from 35 cents a year earlier.
The company's operating earnings, which exclude pension costs, rose to 38 cents from 34 cents a year ago, slightly topping the 37-cent per-share consensus estimate of analysts polled by Thomson Reuters.
Revenue climbed 2.5% to $36.5 billion. Analysts expected $36.8 billion in revenue.
Shares were down 0.3% to $19.74 in recent premarket trading. The stock is up 11% so far this year.
Write to Saabira Chaudhuri at email@example.com
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