INSTANT VIEW: GE profit tumbles, revenues miss Street view

NEW YORK (Reuters) - General Electric Co reported a sharply lower quarterly profit and missed Wall Street's revenue targets on weakness at its finance and NBC media businesses.

Quarterly revenues from continuing operations were $39.1 billion, down 17 percent year-over-year. Analysts expected the conglomerate to report revenue just north of $42 billion.

Earnings per share came in at 26 cents in the period, 2 pennies better than expected.

"Our service businesses had positive order and earnings growth in the first half of 2009, and we see this strength carrying over to the second half," said GE Chairman and CEO Jeff Immelt.

Excluding the effects of foreign exchange, GE said its Capital Finance arm has reduced its ending net investment by $24 billion in the first half of the year.

"We have substantially increased our capital ratios, reduced leverage, increased reserves, accelerated long-term debt funding and lowered commercial paper balances," Immelt said.

COMMENTS:

TOM SCHRADER, MANAGING DIRECTOR, U.S. EQUITY TRADING, STIFEL NICOLAUS CAPITAL MARKETS, BALTIMORE

"The revenue number in GE was weak, and overall the markets aren't reactive positively to anything. The dollar is positive because of the bombings in Jakarta, and the energy markets are up across the board.

"I think investors are still concerned about the earnings season. The results we've seen are leading people to think the season will be better than expected. Today will be a day for the markets to give back though, because we've been up so much and because of GE's revenue number. It's time for a breather."

PETER SORRENTINO, SENIOR VICE PRESIDENT AND PORTFOLIO MANAGER, HUNTINGTON ASSET ADVISORS, CINCINNATI:

"Hitting the bottom line number was pretty good news, but that top line revenue, that's a big miss…. For them to come in at the $39 (billion revenue) range, that was definitely disconcerting."

"The industrial side has got to be able to deliver, and right now you're seeing storm clouds virtually across the board for the corporation."

CRAIG PECKHAM, EQUITY TRADING STRATEGIST, JEFFERIES & COMPANY, NEW YORK:

"The bar for expectations has been set higher and that's one of the reasons I'm not seeing an explosive move here pre-market. GE earnings reports are sort of trying to get yourself through the encyclopedia Britannica, with a lot of information to digest. So the market is sort of taking time to digest the information.

"On its face, this looks like a set of results that at a minimum is probably neutral for market sentiment or maybe a little bit positive."

RUSSELL CROFT, PORTFOLIO MANAGER, CROFT-LEOMINSTER IN BALTIMORE, OWNS 260,000 GE SHARES.

"The actual earns number looks pretty good, but revenue were a little lighter than Wall Street expected. In a tough environment, it looks like a pretty good quarter. The one thing I want to get more color on is GE Capital.

"They've been shrinking faster than expected.

"Energy infrastructure was up 13 percent and the tech side was down a teeny bit, probably in line with what the company was looking for. We like the company's long-term exposure to a global economic rebound.

"At these levels it's not a bad time to get exposure to GE, understanding that 2009 will be a tough year for everybody.

"We would hope (the trough) would be this year and they can grow earnings going forward. The company said '09 is going as expected, so I hope earnings will be higher in 2010 than 2009, and 2011 could look even better.

HOWARD WHEELDON, SENIOR STRATEGIST AT BGC PARTNERS, LONDON

"GE has to suffer despite being the biggest industrial company in the world."

"They had given enough hints that 2009 was going to be bleak, but there is justified anticipation that 2010 will be a decent year for them.

MIKE LENHOFF, CHIEF STRATEGIST AT BREWIN DOLPHIN, LONDON

"(The results are) quite a satisfactory outcome and quite consistent with what we have seen thus far with the earnings season. The message that the market is hoping to be delivered from the results is that companies have past the worst of the recession. I think that's what has come out of the GE results and it comes out of the results we have had thus far."

OWEN IRELAND, ANALYST AT ODL SECURITIES, LONDON

"The numbers are far from inspiring, but in this environment that could be seen as a positive."

"The momentum caused by Goldman and JP Morgan Chase needs to be sustained, especially going in to the last trading session of the week."

HEINO RULAND, STRATEGIST AT RULAND RESEARCH, GERMANY

"General Electric results were not too bad, earnings per share was slightly better than expected.

"People are looking at the top-line numbers which showed its order intake in its higher margins business is growing. Electricity producing and distributing were not that good, but people are focusing on the top-line numbers and earnings grew by 13 percent showing it is a strong profitable business.

"This is very important as it is the first major industrial business to show this."