The General Electric Co. logo is seen at the company’s headquarters in Boston, Massachusetts, U.S. July 23, 2019.
Alwyn Scott | Reuters
General Electric forecast 2023 adjusted earnings below expectations on Tuesday as the big industrial company grapples with ongoing problems in its money-losing renewable energy business.
GE shares fell 2% to $78.29 in premarket trading after the company forecast an operating loss of between $200 million and $600 million for its GE Vernova energy business in 2023.
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The company’s renewable energy business has faced challenges due to inflation and supply chain pressures. The unit reported a loss of $2.2 billion in 2022.
As GE aims to make its renewables business profitable next year, chief executive Larry Culp has described its onshore wind unit as “the battleground” of the company.
The company is reducing the global onshore wind unit workforce by approximately 20% as part of a corporate restructuring and right-sizing plan.
GE, which completed the spin-off of its healthcare unit earlier this month, plans to spin off its energy business, including renewables, into a separate company next year.
GE said it expects full-year adjusted earnings of between $1.60 and $2.00 per share this year, versus an average analyst forecast of $2.36 per share, according to Refinitiv.
Its aerospace business is expected to continue to increase results due to strong demand for engines and aftermarket services. GE Aerospace’s operating profit is expected to be between $5.3 billion and $5.7 billion for 2023.
GE’s adjusted earnings for the fourth quarter were $1.24 per share, beating analysts’ average estimate of $1.13 per share.