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General Electric's Third Quarter Earnings Report
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General Electric Company (NYSE:GE) announced its results for the most recent quarter on October 19, 2012. General Electric is an advanced technology, services and finance company that provides services ranging from aircraft engines to business and consumer financing.
Investors should care about a company's quarterly earnings because it shows the state of the business over the past 90 days and provides guidance for the following 90 days.SEE: 5 Tricks Companies Use During Earnings Season
The Numbers:
General Electric posted revenues above analyst predictions, though the company's EPS came up short of expectations. The company reported adjusted net income of 36 cents per share versus the 37 cents per share estimate and revenues of $36.35 billion versus the $36.8 billion estimate. Revenue climbed 2.8% from the same period last year. Revenue rose for a second quarter in a row as General Electric's sales grew 2.5% to $36.5 billion in the second quarter as well. The company's net income for the quarter rose 8.3% to $3.49 billion. Last quarter's profit increase comes after three consecutive quarters of year-over-year profit decreases. Profits declined 17.5% in the second quarter,11.6% three quarters ago, and 17.8% four quarters ago.
Management Quote:
"The overall environment remains challenging, but GE continues to execute on our growth strategy," said GE Chairman and CEO Jeff Immelt. "GE's Industrial segments delivered another quarter of strong organic revenue growth, and we ended the quarter with a robust backlog. As expected, our margins increased 70bps over the prior year period, with margin expansion in all five Industrial segments."
A Look Back:
Net income has increased 3.7% year-over-year on average across the last five quarters. The biggest gain came in the third quarter of the last fiscal year, when income climbed 56.9% from the year-earlier quarter.
Looking Ahead:
For next quarter, analysts have a more positive outlook about the company's expected results. The average estimate for the fourth quarter is 47 cents per share, up from 46 cents 90 days ago. When analyst increase earnings estimates investors can assume business has been stronger than first thought and is an encouraging sign for investors. Over the past 60 days, the average estimate for the fiscal year has reached $1.55 per share, a decline from $1.56.
Investors should care about a company's quarterly earnings because it shows the state of the business over the past 90 days and provides guidance for the following 90 days.SEE: 5 Tricks Companies Use During Earnings Season
The Numbers:
General Electric posted revenues above analyst predictions, though the company's EPS came up short of expectations. The company reported adjusted net income of 36 cents per share versus the 37 cents per share estimate and revenues of $36.35 billion versus the $36.8 billion estimate. Revenue climbed 2.8% from the same period last year. Revenue rose for a second quarter in a row as General Electric's sales grew 2.5% to $36.5 billion in the second quarter as well. The company's net income for the quarter rose 8.3% to $3.49 billion. Last quarter's profit increase comes after three consecutive quarters of year-over-year profit decreases. Profits declined 17.5% in the second quarter,11.6% three quarters ago, and 17.8% four quarters ago.
Management Quote:
"The overall environment remains challenging, but GE continues to execute on our growth strategy," said GE Chairman and CEO Jeff Immelt. "GE's Industrial segments delivered another quarter of strong organic revenue growth, and we ended the quarter with a robust backlog. As expected, our margins increased 70bps over the prior year period, with margin expansion in all five Industrial segments."
A Look Back:
Net income has increased 3.7% year-over-year on average across the last five quarters. The biggest gain came in the third quarter of the last fiscal year, when income climbed 56.9% from the year-earlier quarter.
Looking Ahead:
For next quarter, analysts have a more positive outlook about the company's expected results. The average estimate for the fourth quarter is 47 cents per share, up from 46 cents 90 days ago. When analyst increase earnings estimates investors can assume business has been stronger than first thought and is an encouraging sign for investors. Over the past 60 days, the average estimate for the fiscal year has reached $1.55 per share, a decline from $1.56.
by
Investopedia Staff
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