Shares in General Electric Company (NYSE:GE) tanked 7% before the bell as its third quarter earnings fell way short of expectations and it slashed its guidance for the full year.
The firm's new adjusted earnings per share (EPS) forecast for 2017 was cut to a range of between US$1.05 and US$1.10 a share, from between US$1.60 and US$1.70 a share previously.
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The numbers were weighed down by restructuring costs and one commentator was reported as describing it as simply a 'throwaway" quarter.
It was the first earnings report from new chief John Flannery, who replaced Jeff Inmelt in August, and he is faced with the unenviable task of trying to turn around the huge manufacturer's slump in fortunes, with issues including poor cash flows and slumping power-generation markets.
Very challenging quarter
Its power business saw profits decline 51% to US$611mln, from a whopping $1.3bn at the same time last year.
“This was a very challenging quarter,” Flannery said in the statement.
“While a majority of our businesses had solid earnings performance, this was offset by a decline in Power performance in a difficult market.”
After taking out the restructuring charges, the group earned 29 US cents per share from continuing operations in the third quarter, down 9% from the same period a year earlier. Analysts had expected the company to earn 49 US cents per share.
That said, revenue rose 14% to US$33.47bn, which did beat analysts' expectations of $32.56bn.
Shares in the group have fallen by more than 25% this year.