GE’s new CEO slashes profit outlook

General Electric Co. slashed its 2017 profit forecast as its new boss grapples with one of the deepest slumps in the beleaguered manufacturer’s history.

The revision underscores the severity of the challenges facing Chief Executive Officer John Flannery, who took over Jeffrey Immelt’s longtime post in August. Facing hurdles from poor cash flows to slumping power-generation markets, GE is by far the biggest loser on the Dow Jones Industrial Average this year and has seen a quarter of its market value evaporate.

“This was a very challenging quarter,” Flannery said in a statement. “While a majority of our businesses had solid earnings, this was offset by a decline in Power performance in a difficult market.”

The cut is the latest step in what is shaping up to be a dramatic repositioning of GE under its new leadership. Flannery this month welcomed a representative of activist investor Trian Fund Management to GE’s board and announced several management changes.

Adjusted earnings this year are expected to be $1.05 (Dh3.86) to $1.10 a share, down from a previous range of $1.60 to $1.70 a share, GE said yesterday.