The General Electric plan is set. The company said last month that it would shrink to just three major operations: jet engines, electric power generators and wind turbines.
Now, investors and analysts are focused on the performance of those industrial businesses and whether the company can avoid further nasty surprises in its trouble-prone finance arm.
General Electric's second-quarter results, which were announced Friday, showed that the company is making progress in cutting costs and that its aviation business is thriving. But it has not yet reversed its fortunes and halted its decline, as its ailing power-generation unit in particular continues to contract.
GE reported a 30 percent falloff in net profit to $615 million. After adjusting for one-time charges, the preferred yardstick of Wall Street analysts, the company reported earnings of 19 cents a share. That was slightly higher than analysts' average forecast of 17 cents a share, as compiled by Thomson Reuters.
Revenue for the quarter rose 3 percent to $30.1 billion, somewhat above the consensus Wall Street estimate of $29.3 billion.
General Electric was once one of the biggest industrial employers in Chattanooga. But in 2016, GE sold its Lafayette, Ga.-based oven and stove manufacturing plant to China's Haier and shut down the former Alstom and Combustion Engineering power equipment plant in Chattanooga. GE ultimately sold its vacant 94-acre Alstom site in June to a local development group for $30 million as part of GE's ongoing expense cuts.
In a conference call with analysts Friday, John Flannery, GE's chief executive, said the second-quarter report contained signs of "significant progress," including expenses being trimmed by $1.1 billion so far this year against a target of more than $2 billion for the full year. Yet he cautioned that 2018 would be "a reset year" in a longer campaign of corporate renewal.
"The path is clear," said Flannery, who became chief executive last August.
In an interview, Jamie Miller, GE's chief financial officer, said she expected a strong and improving performance across the company's industrial businesses, except the power unit, in the second half of 2018. Still, GE tempered some expectations for the year, saying that profit and cash flow would be toward the low end of the company's previous forecasts.
Any turnaround at the company will probably require "a long, hard slog," said Steven Winoker, an analyst at UBS.
Shares of GE stock, which have fallen nearly in half in the past year, declined even more on Friday, falling by more than 4 percent in trading Friday to close at xxxx.