- General Electric (NYSE:GE) is undergoing a number of changes as its new CEO tries to turn the company around.
- Among the changes are a 50% cut to the company's dividend and a reduction in the number of employees.
- The company announced its fiscal year outlook for 2018, which was lower than Wall Street's expectations.
- Watch GE's stock price move in real time.
General Electric shares are down 2.64% to $19.94 on Monday after the company announced disappointing earnings guidance and a dividend cut of 50% to $0.12 per share, among other changes.
The company announced that it expects adjusted earnings of $1.00 to $1.11 per share for 2018, which was lower than Wall Street's expected $1.18.
The dividend cut is the latest in a string of decisions to reorganize the company with a focus on increasing profitability. CEO John Flannery announced on Friday that he would be cutting jobs across the company, focusing on the power and software arms of the business.
GE said it wants to cut $3 billion in costs by the end of next year, and investors seem to like the plan. Cutting dividends doesn't sound like a plan that would make shareholders happy, but companies that spend capital on the business instead of paying shareholders tend to perform better.
GE was one of the biggest dividend-paying companies before its cuts, distributing more than $8 billion to shareholders annually.
General Electric is down 34.66% this year.