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GE NYSE· General Electric Co.
Earnings report Q4 2023

GE Reports Strong Revenue Growth in Latest Quarter

Segments of revenue

In the latest quarter, GE experienced significant growth in its segment revenues. The Aerospace segment saw an increase in organic revenues, driven by higher prices and scope on Heavy-Duty Gas Turbines and Aeroderivatives, as well as increased services and equipment in Gas Power, Steam Power, and Power Conversion. The Renewable Energy segment also reported higher organic revenues, primarily due to increased collections, including down payments on equipment orders. Additionally, the Power segment witnessed growth in segment revenues, mainly attributed to higher commercial spare part shipments, internal shop visit volume, work scopes, and prices in Commercial Services and Commercial Engines. Defense revenues also increased, driven by product mix and growth in development contract revenue.

Strengths

GE's financial performance in the latest quarter demonstrates several strengths. The company experienced a significant increase in segment revenues, with a 9% growth overall. This growth was primarily driven by organic revenue increases in Aerospace, Renewable Energy, and Power segments. The company's management attributes the revenue growth to higher prices, scope expansions, increased services and equipment, and improved commercial spare part shipments. These factors indicate that GE's strategic initiatives and market positioning are yielding positive results.

Challenges

While GE's revenue growth is impressive, there are some challenges to consider. The Steam Power equipment segment experienced a reduction in revenues due to the ongoing exit from new build coal projects. This indicates a potential weakness in that particular market segment. Additionally, the company's earnings and earnings per share have been volatile in recent years, with significant losses in 2022. Although there has been a substantial improvement in earnings in the latest quarter, the company needs to maintain consistent profitability to ensure long-term financial stability.

Noteworthy

It is worth noting that GE's segment profit also increased in the latest quarter, with a 19% growth overall. This growth was primarily driven by organic profit increases in Gas Power services, offsetting inflation. The company's progress in increasing profitability alongside revenue growth indicates effective cost management and operational efficiency.

Summary

GE's latest quarter performance showcases strong revenue growth across multiple segments, including Aerospace, Renewable Energy, Power, and Defense. The company's strategic initiatives, such as higher prices, scope expansions, and improved services and equipment, have contributed to this growth. However, challenges remain, particularly in the Steam Power equipment segment and the need for consistent profitability. Overall, GE's revenue growth and improved segment profit demonstrate positive momentum for the company.

Source documents

Form 10-K  filed on Feb 02, 2024
127 pages scanned

Reference data

Company financials Q4 revenue 19.42B
Analyst estimates Q4 EPS beat by 14.86%
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