General Electric said profit fell by almost half, on a deeper drop in revenue than Wall Street expected, as the slump that has gripped its finance and media businesses took hold of its heavy industrial units.
The largest US conglomerate, whose shares fell 3.2 per cent in premarket trading, reported earnings that topped Wall Street's expectations, but posted a 17-per cent drop in revenue that was far deeper than the 10-per cent decline analysts expected.
Earnings tumbled at all its businesses except for the energy infrastructure unit, which makes equipment including electricity-producing turbines and gear used in oil and gas production.
GE's second quarter net income came to $2.67 billion, or 24 cents per share, compared with profit of $5.07 billion, or 51 cents per share, a year earlier.
Profit from continuing operations came to 26 cents per share. On that basis, analysts on average had looked for 24 cents.
Revenue fell 17 percent to $39.08 billion. Factoring out fluctuating exchange rates, revenue would have fallen 12 per cent.
GE's size and the scope of its operations - which range from commercial lending to building railroad locomotives to running the NBC television network - make it a bellwether of the world economy, which is facing a brutal recession.
The world's largest maker of jet engines has been dragged down by deteriorating profit at its GE Capital arm, which has been hurt by heavy investments in commercial real estate and a weaker credit environment.
The company generated $7.1 billion in cash from operations and that its backlog of orders held steady at $169 billion.
Shares declined 40 cents to $12 in premarket trading.
GE shares have fallen about 24 per cent so far this year, a much sharper decline than the 1 per cent slide of the Dow Jones industrial average.
Reuters