Shares of General Electric (NYSE:GE) shot up today after the multinational industrial company reported adjusted Q3 profits that beat The Street, where analysts predicted a loss.
Boston-based GE reported earnings of –$1.195 billion, or –13¢ per share, on sales of $19.417 billion for the three months ended Sept. 30, 2020. The company saw even wider losses — –$9.383 billion, or –$1.08 per share — off sales of $23.360 billion during Q3 2019.
Adjusted to exclude one-time items, earnings per share were 6¢, 10¢ ahead of The Street, where analysts were looking for adjusted EPS of –4¢ on sales of $18.72 billion.
Except for GE’s Aviation business, every other business in the company including GE Healthcare is seeing organic margin expansion, CEO H. Lawrence Culp Jr. said in a news release.
“We are managing through a still-difficult environment with better operational execution across our businesses, and we are on track with our cost and cash actions,” Culp said in a news release.
“While our work continues, GE’s transformation is accelerating, and we expect Industrial free cash flow to be at least $2.5 billion in the fourth quarter and positive in 2021. We remain focused on unlocking upside potential for the long term.”
GE Healthcare orders were down 20% year-over-year, to $4.125 billion. The decline was mostly due to the disposition of the company’s BioPharma business, which GE sold to Danaher for $20 billion earlier this year. Healthcare Systems was down 5% organically, mainly due to lower equipment demand, with Pharmaceutical Diagnostics down 2% organically.
The company also noted that GE Healthcare profits were up 30% from a year earlier on a like-for-like basis (excluding the effect of the Biopharma sale). The increase was primarily due to cost reductions, productivity and increases in Healthcare Systems volume.
Investors reacted by sending GE shares up 9.08% to $7.74 apiece by midday trading today.
