Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 
OFFON

MarketScreener Homepage  >  Equities  >  Nyse  >  General Electric Company    GE

GENERAL ELECTRIC COMPANY (GE)
My previous session
Most popular
  Report  
SummaryQuotesChartsNewsAnalysisCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsOfficial PublicationsSector newsTweets
OFFRE

GE cutting staff ahead of new CEO's Monday overhaul: sources

share with twitter share with LinkedIn share with facebook
share via e-mail
0
11/10/2017 | 11:03pm CEST
FILE PHOTO: The ticker and logo for General Electric Co. is displayed on a screen at the post where it's traded on the floor of the NYSE

NEW YORK (Reuters) - General Electric Co is laying off sales staff and other employees in its software division, according to people familiar with the matter, ahead of new Chief Executive John Flannery's expected announcement on Monday of a plan to slash costs and jettison units in an effort to improve the company's profits.

The layoffs at GE Digital, based in San Ramon, California, affect about 100 sales people in the Americas, including those who sell GE's Predix industrial-internet software, according to two sources.

The software, central to GE's strategy under former Chief Executive Jeff Immelt, has been beset with technical problems, prompting GE to shift strategy.

The 125-year-old conglomerate is considering job reductions across all of its diverse businesses, the sources said. Struggling units such as GE Power are facing significant staff cuts, while aviation and healthcare businesses could see lesser reductions, the sources said.

Reuters reported in August that Flannery intended to reduce corporate staff at its Boston headquarters significantly, a process that has begun, according to sources. The company has also slowed construction of its headquarters.

It is not clear how many more jobs Flannery now plans to cut, or how quickly. With 295,000 employees, even a 10 percent overall reduction would eliminate nearly 30,000 jobs.

At the digital business, which has about 13,000 people including legacy information technology staff, GE is not only cutting sales staff. It is also reducing the number of developers who create the software, according to the two sources, speaking on condition of anonymity.

Digital sales staff were given notice in recent days and told they could apply for about 19 remaining jobs in the division or other jobs at GE, the sources said.

GE declined to comment on specific staff reductions, but highlighted its plan to cut $3 billion in costs by the end of 2018. "Those actions include but are not limited to, employee reductions which have been well underway for many months," spokeswoman Jennifer Erickson said.

GE shares closed up 2.5 percent at $20.49.

DIVIDEND CUT COMING?

Analysts have slashed estimates for GE's 2018 earnings and expect a major restructuring plan on Monday as GE tries to pull out of a 16-year stock slump.

GE is likely to get much smaller and more focused, Jeff Sprague, an analyst at Vertical Research Partners, wrote on Friday. "It is also conceivable that looking out a few years, GE ceases to exist as we know it," he said, referring to a potential break-up.

"Staffing has to go down meaningfully," said a large Boston-based fund manager who invests in GE. The company spent billions on restructuring the last few years but without growth in operating profit, he added.

Since becoming CEO on Aug. 1, Flannery has doubled the amount of cost cutting targeted for next year to $2 billion, and is cutting $1 billion this year. He said he has found more than $20 billion in GE assets to sell and is looking at further changes to the portfolio beyond that.

A 30-year GE veteran, Flannery is due to present the strategic changes and new financial targets at an investor meeting in New York on Monday. The plans also could include cutting GE's dividend for only the third time in GE's history. The other two were during the Great Depression and the financial crisis.

Flannery has come under increasing pressure to boost GE's profit and share price after the company badly missed earnings expectations for the third quarter and lowered its financial outlook last month.

GE stock has fallen more than 36 percent this year, making it the worst performer in the Dow Jones Industrial Average and posing the risk that the only remaining original company in the widely watched stock index could be kicked out.

Activist investor Ed Garden, a founding partner at Trian Fund Management, recently joined GE's board. Trian invested $2.5 billion in GE in 2015 and pressed the company to cut costs and focus on sectors where it is a market leader, such as power plants, jet engines and medical devices. Trian declined to comment.

GE is considering divestment of its aircraft leasing, transportation and healthcare information technology businesses. The job reduction efforts in GE's units appear to be independent of those divestitures, the sources said.

Flannery already has grounded GE's corporate jets, cut car bonuses for executives and dismissed two vice chairmen to save money.

In another sign of austerity, he shrunk the size of GE's annual leadership retreat in January and moved it from ritzy Boca Raton, Florida, to Boston.

(For a graphic on 'GE's sagging fortunes create pressure for turnaround' click http://tmsnrt.rs/1U5M2dd)

(Reporting by Alwyn Scott; Editing by Bill Rigby and Richard Chang)

By Alwyn Scott

Stocks mentioned in the article
ChangeLast1st jan.
DJ INDUSTRIAL 0.32% 26743.5 Delayed Quote.8.19%
GENERAL ELECTRIC COMPANY -2.33% 12.17 Delayed Quote.-30.26%
NASDAQ 100 -0.50% 7531.0719 Delayed Quote.17.74%
NASDAQ COMP. -0.51% 7986.9551 Delayed Quote.16.29%
S&P 500 -0.04% 2929.48 Real-time Quote.9.62%
share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on GENERAL ELECTRIC COMPANY
12:54aGENERAL ELECTRIC : Summer’s Great Scavenger Hunt For GE’s Aviation T..
PU
09/21GENERAL ELECTRIC : GE Says Additional Turbine Models May Have Blade Problems -- ..
DJ
09/21General Electric says blade problem affects more gas turbines
RE
09/21GENERAL ELECTRIC : GE Power High-Efficiency Gas Turbine Update
PU
09/21GENERAL ELECTRIC : Kisumu County and GE Healthcare roll out new maternal and new..
AQ
09/21Flaw in GE Turbine Hampers Utility in Texas -- WSJ
DJ
09/20GENERAL ELECTRIC : Patent Application Titled "Improvements In And Relating To Bi..
AQ
09/20GE Discovers Flaw in Latest Power-Plant Turbines -- Update
DJ
09/20GE Discovers Flaw in Latest Power-Plant Turbines
DJ
09/20Four General Electric power turbines shut down in U.S. due to blade issue
RE
More news
News from SeekingAlpha
09/21Can A Critical Boeing Supplier (Safran) Continue To Outperform Its Customer? 
09/21GE says turbine blade problem affects another model 
09/21Let's Talk About General Electric's Downgrade 
09/21GENERAL ELECTRIC : A Dividend Cut Would Be A Positive Development, Eventually 
09/20REUTERS : GE says four U.S. power turbines shut down due to blade problem 
Financials ($)
Sales 2018 123 B
EBIT 2018 13 490 M
Net income 2018 7 530 M
Debt 2018 55 317 M
Yield 2018 3,94%
P/E ratio 2018 42,96
P/E ratio 2019 13,73
EV / Sales 2018 1,31x
EV / Sales 2019 1,29x
Capitalization 106 B
Chart GENERAL ELECTRIC COMPANY
Duration : Period :
General Electric Company Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends GENERAL ELECTRIC COMPANY
Short TermMid-TermLong Term
TrendsBearishBearishBearish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus HOLD
Number of Analysts 17
Average target price 16,8 $
Spread / Average Target 38%
EPS Revisions
Managers
NameTitle
John L. Flannery Chairman & Chief Executive Officer
Daniel C. Janki Treasurer & Senior VP-Global Operations
Jamie S. Miller Chief Financial Officer
Jim Fowler Chief Information Officer
Victor Abate Chief Technology Officer & Senior Vice President
Sector and Competitors
1st jan.Capitalization (M$)
GENERAL ELECTRIC COMPANY-30.26%105 770
3M COMPANY-8.54%126 902
HONEYWELL INTERNATIONAL8.59%124 268
SIEMENS-5.09%110 078
ILLINOIS TOOL WORKS-11.03%49 780
JARDINE MATHESON HOLDINGS LIMITED1.38%45 572