Revenues were down 4% year-over-year as sales fell 2% in the company’s industrial group and revenues from GE Capital were down 3%.
GE noted that orders during the quarter rose 4% to $24.1 billion, and that its backlog of services and equipment at the end of the second quarter was $223 billion, the highest ever for the company. The better news is that pricing increased by 0.9%.
The company did not provide guidance in its press release, but the consensus estimate for the third quarter calls for EPS of $0.40 on revenues of $36.63 billion. For the full year, EPS is pegged at $1.66 on revenues of $147.26 billion. The full-year revenue estimate has come down $2 billion since the end of the first quarter.
The company’s CEO said:
We executed in a business environment that was slightly improved versus the first quarter. Emerging markets remain resilient, and in the U.S. we saw strong growth in orders this quarter. Europe is stabilizing but still challenged. We expect margin expansion to continue and segment profits to grow in the second half of the year.
The company expects margin growth of 70 basis points during the year. Industrial group margins improved by 50 basis points in the second quarter. Revenues in the Power & Water segment were down 17% year-over-year, which is awful, but better than the 26% drop experienced in the first quarter. Power & Water profits also fell 17%. GE expects the second half of the year to be better. That shouldn’t be too difficult.
Shares are up 2.2% in premarket trading this morning, at $24.15 in a 52-week range of $19.45 to $24.45. Thomson Reuters had a consensus analyst price target of around $25.50 before today’s results were announced.
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