General Electric late last week reported a 12% drop in revenue from a year earlier, pushing its stock down to its lowest mark since October 2015, according to CNBC. More troubling is the company's lack of cash flow, says Seeking Alpha.
GE's revenue was $29.558 billion, down from $33.49 billion last year. However, GE did beat Wall Street's quarterly earnings and revenue expectations.
This was GE's last quarterly earnings report under CEO Jeff Immelt. John Flannery will replace Immelt as CEO on Aug. 1.
GE has had to make changes to its business model. Immelt took the challenge of transforming the 125-year-old company head-on, leading digital transformation efforts and helping drive an effort to reinvent GE as a software company, launching a major PR campaign and raising salaries to attract top tech talent.
But such changes take time, and the latest returns don't necessarily mean the company is on the wrong track. The question is whether incoming CEO Flannery will show the same investment in going digital, especially if there is pressure to cut costs. If Flannery picks up the digital transformation efforts where Immelt left off, and gains board support for that effort, there's a decent chance GE could continue its slow transformation to a more nimble, digital-first company.