FAIRFIELD (AP) — General Electric Co. (GE) said yesterday that its first-quarter earnings fell 32 percent, but the industrial and financial bellwether said it saw signs of improvement in its own results and the broader economy.
The results from GE, one of the world’s largest companies that operates in most major segments of the economy, signals that some sectors may be in recovery from the deep recession. GE said there were positive indications in commercial aviation, freight rail and advertising.
“We saw encouraging economic signs,” said chief executive Jeffrey Immelt.
But despite the optimistic tone, GE’s earnings also underscored the major challenges the company faces as it tries to return to profit growth after a several punishing quarters.
Its GE Capital lending unit posted a profit but losses remained high in areas like commercial real estate. GE’s industrial units, which it is relying on to lead it out of the recession, also posted lower sales. And while its earnings beat Wall Street estimates, revenue was lower than analysts expected.
Company shares fell 80 cents, or 4.1 percent, to $18.70 in midday trading.
Eric Boyce, a portfolio at Hester Capital Management, said GE’s results suggest that the domestic economy “is out of crisis mode, but that we are in a muddled, protracted recovery.”
GE Capital has been the biggest headache for the conglomerate over the past two years, as losses on its loans soared on troubles in the home mortgage markets, consumer credit card borrowing and commercial real estate.