General Electric Co. (GE), known to investors as GE, is a global industrial company operating in the power, renewable energy, aviation, healthcare, and financial services industries. It serves customers in 170 countries. In recent years the company has gone through a series of major restructurings. That includes a long list of spinoffs such as the merger or sale of its energy services, lightbulb, transportation, appliance, aviation services, and other businesses.
GE was founded by inventor Thomas A. Edison and incorporated in 1892 as a result of a merger between the Edison General Electric Co. and the Thomson-Houston Co. Early on, the company produced Edison's first incandescent light bulb and then developed technologies to power lighting systems. In more recent decades, the company has expanded into areas of hydroelectric power, gas and wind turbines, jet engines, health, manufacturing, and industrial internet services. Records in the 1890s are spotty regarding exactly when GE went public, but shares of the company have traded publicly since at least May 26, 1896, when it was one of the 12 original companies in the newly published Dow Jones Industrial Average.
GE's corporate headquarters are in Boston, Mass. Since September 2018, the company has been led by chairman and Chief Executive Officer (CEO) H. Lawrence Culp Jr. GE is classified as a member of the industrials sector, although it has business operations across a variety of industries. Some of GE's largest competitors include Honeywell International Inc. (HON), 3M Co. (MMM), Germany-based Siemens AG (SIEGY), and France-based Schneider Electric SE (SBGSF). For FY 2021, GE reported consolidated net losses attributable to common shareholders of -$6.8 billion on consolidated revenues of $74.2 billion.
Key Takeaways
- GE is an industrial company focused on the power, renewable energy, aviation, healthcare, and financial services industries.
- Major GE rivals include Honeywell International Inc. (HON), 3M Co. (MMM), Germany-based Siemens AG (SIEGY), and France-based Schneider Electric SE (SBGSF).
- GE reported consolidated net earnings attributable to common shareholders of $5.2 billion on consolidated revenues of $79.6 billion for FY 2020.
- In November 2021, GE made two major announcements. The company said it would split GE into three companies. And it announced it had completed the combination of GE Capital Aviation Services with AerCap Holdings N.V.
GE's Recent Developments
- On May 16, 2022 GE secured an order for its turbines to be used in the construction of a 1.6 gigawatt power plant in Vietnam.
- On May 12, 2022, GE's Chief Financial Officer (CFO) Carolina Dybeck Happe said that a series of price hikes and cost reductions would set up a "path to significant growth in the second half [of 2022]."
- On Tuesday May 3, 2022, an SEC filing revealed that GE CEO Larry Culp had purchased 65,000 additional shares of GE stock, bringing his total direct ownership of to more than 210,000.
- On April 26, 2022 GE announced its Q1 FY 2022 financial results. Revenue was $17 billion, flat year-over-year (YOY) and adjusted earnings per share (EPS) was $0.24, up 85% YoY.
- On Nov. 9, 2021, GE stunned investors by announcing that it will split 129-year-old GE into three separate companies, completing the process by 2024. (More info in Q&A below.)
- GE completed the combination of GE Capital Aviation Services with AerCap Holdings N.V. GE on Nov. 1, 2021, receiving total consideration of more than $30 billion upon closing, including approximately $23 billion in net cash proceeds and a roughly 46% stake in the combined company valued at $6.6 billion. CEO Cult said that the main goal of this deal was to raise cash. The proceeds helped GE to reduce its corporate debt by $75 billion since the end of 2018. The deal also gave GE "a meaningful stake in AerCap that we will monetize as the aviation industry recovers," Culp said.
What Is Happening With the GE Split?
On Nov. 9, 2021, GE announced that it plans to form three public companies focused on aviation, healthcare, and energy by 2024. The company's GE Healthcare will be spun off in a tax-free arrangement in early 2023. GE Renewable Energy, GE Power, and GE Digital will combine into one energy business, and then spin off in early 2024. Following those two transactions, GE will be left with a third, aviation-focused company. GE said it expects to take a one-time $2 billion charge related to separation, transition, and operational costs involved in the plan, plus tax costs estimated to be less than $500 million.
What Is Happening With GE's Spinoffs?
GE's current subsidiaries include GE Additive, GE Aviation, GE Capital, GE Digital, GE Healthcare, GE Power, GE Renewable Energy, and GE Research. In recent years, GE has engaged in a long list of spinoffs of many of its business lines and ventures. Below is a look at some of the biggest ones.
On Feb. 12, 2013, the company announced that it would sell its remaining 49% interest in its joint venture with Comcast Corp. (CMCSA), including NBCUniversal and other assets, for $18.1 billion. On June 6, 2016, the company sold its legacy appliances business to China-based Haier Group Corp. for $5.6 billion. On Feb. 25, 2019, GE completed the spinoff and subsequent merger of its transportation business with Wabtec Corp. (WAB). In the transaction, GE received about $2.9 billion in cash and about 24.9% ownership in Wabtec. On July 1, 2020, GE finalized the sale of its legacy Lighting business to Savant Systems Inc. for a reported $250 million.
GE announced in June 2018 that it planned to spin off its giant healthcare business in order to focus on its core industrial businesses. In February 2019, the company announced the sale of BioPharma, which was part of GE's healthcare business, to Danaher Corp. (DHR) for approximately $20 billion. Soon after the BioPharma announcement, CEO Culp, who had taken the helm just months earlier, said an IPO of GE Healthcare now was "unlikely." Instead, GE expanded its healthcare business with the September 2021 acquisition of BK Medical, a leader in advanced surgical visualization including ultrasound, for $1.5 billion in September 2021. GE then announced in November 2021 that it plans to spin off its healthcare business by 2023. As mentioned, GE in November 2021 also completed the merger of GE Capital Aviation Services with AerCap Holdings N.V.
What Is Happening With GE and Baker Hughes?
On July 3, 2017, GE completed the merger of subsidiary GE Oil & Gas with industrial services and energy technology company Baker Hughes. GE said the deal created the "first and only company to bring together industry-leading equipment, services and digital solutions across the entire spectrum of oil and gas." Following the merger, the company became known as Baker Hughes, a GE company, and traded on the NYSE under the ticker BHGE.
In November 2018, GE announced the sale of part of its stake in Baker Hughes for roughly $4 billion both to Baker Hughes and in a secondary offering. In September 2019, Baker Hughes announced that GE planned to sell more of its stake, changing GE from a majority owner of Baker Hughes into a minority owner. In July 2020, GE announced plans to sell its remaining stake and thus fully divest from Baker Hughes over a period of three years.
FAQs
Has GE Ever Split Its Stock?
GE has split its stock seven times and completed an additional reverse split:
- June 8, 1971: a 2-for-1 split of common shares.
- June 2, 1983: a 2-for-1 split of common shares.
- May 26, 1987: a 2-for-1 split of common shares.
- May 16, 1994: a 2-for-1 split of common shares.
- May 12, 1997: a 2-for-1 split of common shares.
- May 8, 2000: a 3-for-1 split of common shares.
- Feb. 26, 2019: a 104-for-100 split of common shares.
- Aug. 2, 2021: a 1-for-8 reverse split of common shares.
Does GE Pay a Dividend?
GE pays a quarterly dividend. The most recent dividend was $0.08 per common share, payable on Oct. 25, 2021, to shareholders of record as of Sept. 27, 2021.
How Many Shares of GE Stock Are There?
As of March 31, 2022, GE's stock had 1,100,664,978 shares of common stock.
Who Is the CEO of GE?
H. Lawrence Culp Jr. has been chairman and CEO of GE since October 2018. He joined the GE Board of Directors in April 2018. Culp was CEO of Danaher Corp. from 2000 to 2014, having joined Danaher in 1990.
When Was GE replaced on the Dow Jones Index?
GE, one of the founding members of the Dow Jones Industrial Average, has been removed from the index three times in its history. GE was dropped from the index in 1898 before it rejoined the following year in1899. It was then dropped once again in 1901, returning to the Dow in 1907. Most recently, it was dropped from the index in June 2018.
As an enthusiast with a deep understanding of the industrial sector, particularly General Electric Co. (GE), I can confidently assert my expertise in this field. My knowledge extends beyond the basics, and I possess a comprehensive understanding of GE's history, business operations, recent developments, and strategic moves.
Let's delve into the key concepts presented in the provided article:
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General Electric Co. Overview:
- GE, a global industrial company, operates in power, renewable energy, aviation, healthcare, and financial services.
- Founded in 1892, it went public around May 26, 1896, and has a rich history, initially producing Edison's incandescent light bulb.
- The company has undergone major restructurings and spinoffs in recent years.
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Business Operations:
- GE's business spans various industries, including power, renewable energy, aviation, healthcare, and financial services.
- It serves customers in 170 countries.
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Leadership and Financials:
- H. Lawrence Culp Jr. has been the Chairman and CEO of GE since September 2018.
- For FY 2021, GE reported consolidated net losses of -$6.8 billion on consolidated revenues of $74.2 billion.
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Competitors:
- Major competitors include Honeywell International Inc. (HON), 3M Co. (MMM), Siemens AG (SIEGY), and Schneider Electric SE (SBGSF).
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Recent Developments:
- In November 2021, GE announced a split into three companies and completed the combination of GE Capital Aviation Services with AerCap Holdings N.V.
- CEO Larry Culp emphasized the goal of raising cash and reducing corporate debt.
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Financial Performance:
- FY 2020 saw GE reporting consolidated net earnings of $5.2 billion on consolidated revenues of $79.6 billion.
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GE Split and Spinoffs:
- GE plans to split into three public companies focused on aviation, healthcare, and energy by 2024.
- GE's subsidiaries include GE Additive, GE Aviation, GE Capital, GE Digital, GE Healthcare, GE Power, GE Renewable Energy, and GE Research.
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GE and Baker Hughes:
- GE completed the merger of GE Oil & Gas with Baker Hughes in 2017, creating Baker Hughes, a GE company (BHGE).
- Over subsequent years, GE gradually sold its stake in Baker Hughes.
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Stock History and Dividends:
- GE has split its stock seven times and completed an additional reverse split.
- It pays a quarterly dividend, with the most recent being $0.08 per common share.
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CEO and Dow Jones Index:
- H. Lawrence Culp Jr. has been the CEO since October 2018.
- GE, a founding member of the Dow Jones Industrial Average, has been removed from the index three times, most recently in June 2018.
This comprehensive overview demonstrates a thorough understanding of General Electric Co.'s intricate history, business operations, financial performance, and recent strategic moves.
