GE’s 2023 earnings guidance is weighed down by its renewable energy business

The General Electric Co. logo is seen on the company’s headquarters building on July 23, 2019 in Boston, Massachusetts, the United States

Alwyn Scott | Reuters

General Electric on Tuesday forecast lower-than-expected adjusted earnings for 2023 as the industrial conglomerate grapples with ongoing problems at its loss-making renewable energy business.

Shares of GE 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.

The company’s renewable energy business has faced challenges due to inflation and supply chain pressures. The unit reported a $2.2 billion loss in 2022.

As GE aims to make its renewable energy business profitable over the next year, Chief Executive Larry Culp has called its onshore wind unit “the battleground” for the company.

The company is reducing the global workforce at its onshore wind power unit by approximately 20% as part of a plan to restructure and scale the business.

GE, which completed the spin-off of its healthcare division earlier this month, plans to spin off its energy business, including renewable energy, into a separate company next year.

GE said it expects full-year adjusted earnings in the range of $1.60 to $2.00 per share this year, compared to analysts’ median forecast of $2.36 per share, according to Refinitiv.

The aerospace business will continue to grow results on strong demand for engines and aftermarket services. GE Aerospace 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’ median estimate of $1.13 per share.

This is breaking news. Please check again for updates. GE’s 2023 earnings guidance is weighed down by its renewable energy business

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