GE’s turnaround is gaining steam. The industrial conglomerate reported on Tuesday a big surge in quarterly cash flow that crushed its own expectations … and issued an upbeat outlook.
General Electric generated $4.4 billion in cash flow in the fourth quarter, and it now sees that totaling $2.5 to $4.5 billion for this year. Investors closely track cash flow because it’s seen as a sign of the health of GE’s operations and its ability to pay down debt.
Wall Street liked what it saw, driving GE’s shares up nearly 11% in early trading Monday. CEO Larry Culp has been trying to revive the company by improving free cash flow and cutting debt. He said he’s seeing momentum across all of GE’s businesses.
The pandemic slammed its most profitable and biggest cash-generating business, aviation. But with air traffic expected to recover in the second half and Boeing’s 737 MAX jets return to the skies, GE said its aviation revenue would be flat to higher this year.
The 128-year-old company that was once the most valuable U.S. corporation and a symbol of American business might has slimmed down into a company that focuses on jet engines, power plants and renewable energy.