Apr. 26—SCHENECTADY — General Electric is making big preparations for a three-way split in the company despite experiencing stagnant growth.
GE has been reshuffling personnel across its brands and bringing on new executives ahead of the break-up. The company employs hundreds of workers at its research and power facilities in Schenectady and Niskayuna.
Regardless of the buzz surrounding GE's pre-split moves, the company reported flat revenues totaling $17 billion in the first quarter of 2022 and continuing earnings lost per share at $0.74, according to its latest report with the Securities and Exchange Commission.
The corporation's stock price tumbled to $80.01 as of noon on Tuesday.
GE reported an income loss of about $1.2 billion this quarter.
GE CEO H. Lawrence Culp Jr. said the same outlook was forecast in January and remains on track for the three-way spinoff.
"But as we continue to work through inflation and other evolving pressures, we're currently trending toward the low end of the range," he said in a press release.
Overall revenue was bolstered by GE's aviation business, which produced $5.6 billion in revenue — up 12 percent from 2021 — as travelers resume trotting around the globe and the industry rebounds, while its power and renewable energy sectors experienced drop-offs.
GE sustained a half-billion loss in profits, primarily due to an $800 million impairment cost of the steam asset sale.
And a host of challenges has put the company in a tight position.
Continued inflation and supply chain disruptions have made it hard to attain key materials needed to make products and "negatively impacted" profit margins, the company admitted.
The ongoing conflict in Ukraine and pandemic-inspired troubles in China have also had an adverse effect on business.
GE similarly experienced a $900 million rise in unfulfilled customer orders for several products, including plane engines. According to the filing, inflation and supply delays are postponing GE from converting those unfulfilled orders into revenue.
In some cases, such as its renewable energy arm, the delay is also leading to customer investment deferrals.
The company's latest quarterly filing showed it spent about $119 million in pre-tax separation costs "primarily related to business separation and employee cost."
"Liabilities associated with restructuring activities were approximately $0.9 billion and $1.0 billion, including actuarial determined post-employment severance benefits," the company said, signaling some workers might have been let go.
GE additionally said that as part of the incoming three-way division, it will incur roughly $2 billion in "separation, transition, and operational costs" over the next two years.
When asked if layoffs were on the horizon or had been made given the company's report indicated there was about $23 million in workforce reductions for 2022, a GE spokesperson said the local workforce in the Capital Region has remained "steady" since the company announced the split.
GE's last major round of local layoffs happened in 2018. GE cut 225 jobs at its Schenectady facilities amid concerns over the power market. But in February of this year, it also sold off part of its steam power business to a French firm.
The sell-off didn't impact jobs in Schenectady, according to a GE spokesperson.
During an investor call Tuesday, Culp said the company is "managing through."
"Overall, I hope you see what I see — that our businesses are positioned for success as we continue to scale lean and drive innovation delivering better results for our shareholders today and tomorrow," he said.
Larry Rulison contributed to this reporting.
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