Thread regarding General Electric Co. layoffs

GE power had $7.41 Billion in sales but only made $611 Million in earnings because of bloated cost structure.

We used to make around $650 Million on just $2.5 to $3 Billion in sales before GE set up shop in Atlanta and other bloated cost centers. GE problem is cash flow from lack of earnings from bloated costs from inept management from all the changes that guys like Bob Nardelli and Steve Bolz made.

Those numbers are right on. GE Power is failing because of bloated cost structure full of duplication, excessive management, and inefficiency and cost of quality caused by turmoil in the workplace and gutting out expertise by inept management.

Add to this the huge bloated cost structure and duplication of Atlanta, where the functions there used to be done by a fraction of headcount in the product departments where service was attached to the expertise there. Other duplication GE factories built in India and China, and Alstom duplication has put power in a near cost death spiral.

GE needs to go back to vertical integration, where they manufacture products again instead of buy expensive farmed out parts and try to mark them up after limited assembly in too many facilities operating at low utilization factors. GE has really screwed up from decades of bad structural changes by out of touch new management types.

Except that I wasn't trying to predict the future (per my original reply, "can we look back and see...") but give my thoughts on the information released in the 3rd quarter results. Which showed that in GE Power, revenue was down $362 million, and Operating Profit was down $636 million. I assume that difference of $274 million was due to increased spending, but I could be wrong.

The results also showed EPS of 29 cents per share, while Thomson Reuters had expected earnings of 49 cents per share. At over 8.6 billion shares outstanding, that's a miss of $1.73 billion.

If there is data that shows that renewables are solely responsible for the $362 million revenue drop, which is solely responsible for the $1.73 billion earnings miss, I'd be interested to see that data.

Long story short, GE Power was only a portion of the financial problems at GE, revenue lost to renewables was only a portion of the problems at GE Power. All of these problems only coming to light in July -September is bizarre, especially when gas turbines ship about 20 months after CKOM/ODM/DFM or whatever it may be called now.

Is management up to it? We're on the same page there.

Including GE Power's 3Q revenue and Operating Profit. Which showed V% of -4% and -51%, respectively.

Sorry but if that's all you got then you have no way to project into the future.

A better projection is the dividend cut. That's the mark GE has set for itself and it's half of what it was a year ago. They think, going forward, they are only going to be able to pay half the dividend they used to pay. They think, if they work really, really hard, operating profit will be half of what it was. How much of that is data driven vs. a wish?

Most ominous is the fact that the forward guidance from the second quarter was all kisses and well wishes AFTER layoffs were announced in the first quarter. What happened? What new information did GE get after June 30th that was so terrible? If it was, as you say, a simple matter of cutting costs then the layoffs in 1Q should have done the trick.

Putting all that together, things are ACCELERATING downward faster than GE internally projected at the end of 2016. That acceleration is NOT GE's fault.

I know everyone wants to pile on GE's management but it's not their fault things are getting worse faster than they thought.

The new board should demand a bottoms up review of projected revenue. That projection should be refined better and better every quarter. Every assumption should be reexamined. One then two then three different ways should be used to recalculate every number. GE's management needs cold hard facts not wishes and kisses. Are they up to it? I doubt it.

...a problem with internal spending...

-2oco,

Not being a GE employee, I have no access to those numbers. I only have access to the numbers that are made public. Including GE Power's 3Q revenue and Operating Profit. Which showed V% of -4% and -51%, respectively.

Those numbers indicate to me a with internal spending, not a mass exodus of customers.

We really need to get rid of the parasites at the top of the company. They are to far away from the action to make the big decisions that hurt so many families. In truth they are just a bunch of globalists out to push their own agenda and enrich themselves. Blaming market changes is lame. If Flannery and Immelt can't understand the markets then why are they in the role? Flannery didn't drop out of the sky with clean hands here. He made this mess. They should both be in prison.

I know there are countless articles in the Wall Street Journal and such repeating the claim of renewables killing GE Power, but the numbers tell a different story.

So how's the GE fleet in Europe looking? Are starts and hours tracking CSA assumptions? What about in North America?

I think you might know the answers.

GE shareholders will soon know. The shareholder lawsuit over the 2Q earning projections should get at GE's revenue assumptions.

When will Immelt be indicted? Then we will know what happened.

Mr. Flannery will restore GE to World Class. Give him time

LOL. No chance.

OP, no wonder why GE is in this state because it has ignorant people like you.

@QKwpHVL-1jov I sincerely think they engaged a PR to monitor this website. some posts are just pure propaganda

Lol.Flannery himself must have written this post!

Every top management including Flannery is useless and clueless .Stop day dreaming and get out of the company before it goes bankrupt

Move along, GE is a wretched hive of scum and villainy.

GE is a joke. I was an SPB Director for about a year until I quit and joined another company last month. GE VPs and above are great ones for spouting off Jack Welch-isms and creating slide-ware, but they have zero, and I mean zero, vision for how to move the needle for their respective businesses. Can't tell you how many meetings I was in with SVPs that talked on and on about nothing. Look no further than the numbers and how GE's businesses are in a tailspin for proof of what GE leadership is capable of.

Analysts believe $11 to $14 if GE was broken up and sold as parts, and they expect another 30 to 40% share price drop in 2018.

The numbers are even worse than you state because in addition they just had to borrow $6 Billion to fund pension plan. Worst of all is that they wasted and sold off the GE empire of businesses last decade for cash to hide organic short falls from bad management. They had many billions in cash cow business bottom line that has now been squandered.

GE is failing because of decades of bad management instead of having experts run the businesses

The share price will be at $30 ish. Where it was a year ago. You are dreaming, the company has zero cashflow, its assets match its liabilities. The problem is systemic.

Flannery is not the problem.

The problem is all the useless, disconnected managers from bottom up who were promoted with little knowledge of the business. Actually mostly clueless who just make charts and graphs instead of knowing hoe to run things they don't understand.

GE used to have world class experts running the business.

Now we have political hacks that have destroyed the brand image

GE Power execution is the real problem.

We have inferior leadership where few if any have real knowledge of products, manufacturing, customers, or the service business. GE s now famous for putting people in charge with little knowledge and are disconnected from the real action.

GE is full of armchair generals and beaurocrats these days who have never done the work.

This is why GE Power has execution problems and is alienating workers and customers, especially in the service business

@QKwpHVL you don't get it do you! Even if he is a world class leader, the issue is bellow him starting from this SPBs and execs coming straight from CAS. I will trust him only if he makes the move to stop this favoritism with no sense (this people are only experts on PPt and some excel sheets). Most of them will be unable to leave GE, because the only company where you can BS your way up is GE and they lost the years where they could have built real expertise, meaning all of them will fight starting from their VP.

Anecdote: The same VP tried to sell GE software to some shipping company DHL or FeDex and their sale argument was "it will save you fuel money", what they did not know is that this shipping companies have Officers with huge teams to do that. so this guy answered him saying "you are telling me that your software is going to do my job better than I" huge embarrassment from our dear Officers and VPs, then we got kicked out.

Here you go, this is the kind of people we have now. Arrogant with no market insight full of themselves.

Just saying, I m out of this place anyway

Sounds good but while "Mr. Flannery" as you call him attempts to "figure it out", I believe you said in 2 years or so; how many employees do you estimate would have lost their jobs not to mention how many plants will be shut down by then... which in turn means more enployees losing their jobs. While I can appreciate your positive outlook on the future of this company I lost that hope years ago. Things will only get worse before they get better and in the end Flannery will still be getting his million dollar paychecks while laying us ordinary employees off left and right. Wake up...things are bad and there is no getting around this.

A turnaround might be possible, but not with the current leadership.

Mr. Flannery!! You speak such highly of him, yet many families will struggle over the next 2 years because of decisions from your beloved leader. FOH. You sound like you're from North Korea with that Dear Leader BS.

You are delusional! Chug that kool-aide!

"Do not offer the energy density" not other. Sorry, I was miscorrected.

I think blaming renewables is a bit of hyperbole as well. Even though they have gotten cheaper, they do not other the energy density per acre that gas fired, nuclear, or other combustion plants offer. The distributed grid will also be more expensive to maintain since it is spread out over large distances. Those total costs are still much higher than for combustion generation, which explains why they still require government subsidy to survive.

In 2 years can we also look back and see if the shift to renewables pans out, or if it was just an excuse. The 3rd quarter revenue for Power was down 4% from 3rd quarter of 2016. That sounds like a slight miss, not like a mass of customers running away from gas turbines towards renewables.

I know there are countless articles in the Wall Street Journal and such repeating the claim of renewables killing GE Power, but the numbers tell a different story.