GE Releases 4Q'23, Full-Year Results

Today, GE released fourth-quarter and full-year 2024 earnings. Below you will find some of the comments I made during the earnings call. To learn more about our results, click here. For important information about forward-looking statements, click here.

GE made tremendous progress in 2023 with excellent operating results, the successful spin of GE HealthCare, and the lean transformation of our company. 2024 will be a momentous year as we launch GE Aerospace and GE Vernova in early April.

Looking at our results, we more than tripled our earnings and generated almost 70% more free cash flow in 2023. GE Aerospace drove double-digit revenue, profit, and cash growth with continued strength in Commercial Engines & Services. GE Vernova delivered meaningfully better results as Renewable Energy and Power together generated positive profit and free cash flow.

In the year ahead, we expect both GE Aerospace and GE Vernova to continue on their respective upward trajectories. Let me spend a moment on each.

GE Aerospace is an exceptional franchise with our fleet of 44,000 commercial engines and 26,000 rotorcraft and combat engines plus extensive aftermarket services, representing 70% of revenue. We live our purpose each day to invent the future of flight, lift people up, and bring them home safely. It's a responsibility we take very seriously, and our teams are focused on safety, quality, delivery, and cost in that order, in everything we do to support our customers and the industry.

Strategically, today, we're executing to meet customer needs for engines and services. Despite the challenged supply chain environment in the quarter, total engine deliveries were up 11% sequentially, including defense up over 60%. We delivered 1,570 LEAP engines, representing 38% growth, yet with more to do going forward. As part of our lean transformation, we're developing connected flow using model lines to improve deliveries. By focusing on key constraints, we reduced lead times, for example, over 40% on our ceramic matrix composite components. And in services, we improved LEAP shop visit turnaround times by double-digits. Lean is not only helping us with delivery but more importantly, when it comes to safety and quality. The team in Rutland, Vermont used lean problem-solving fundamentals to address recurring defects in our GEnx low pressure turbine blades. This improved first-time yield by more than 50%. Lean actions like these within our plants and in partnership with suppliers are driving improvements across GE Aerospace.

For tomorrow, we're building our $150 billion-plus backlog. At the Dubai Airshow, GE Aerospace along with our partners received over 450 engine commitments and several service agreements across both widebodies and narrowbodies. This included an Emirates order for 202 GE9X engines and spares and a long-term services agreement to power its upcoming Boeing 777X fleet. And we're keeping our customers' fleets flying with durability and maintenance enhancements such as our LEAP-1A fuel nozzle cooling system that's on its way to fleet introduction.

And for the future, we're investing in R&D and developing next-generation technologies. Recently, NASA selected GE Aerospace for Phase II of the Hybrid Thermally Efficient Core Program which will significantly enhance fuel efficiency and reduce emissions, improvements we’ll leverage in our RISE program. And the National Defense Authorization Act authorized funding for the Adaptive Engine Transition Program and the Next-Generation Advanced Propulsion Program, which will help provide cutting-edge future military capabilities.

All said, GE Aerospace is accelerating our progress with lean and driving value long-term. All in service of our customers who carry the 3 billion people traveling with our engines under wing each year.

Over to GE Vernova. Our ambition is to electrify and decarbonize the world. With our technologies helping to generate approximately 30% of the world's electricity and where services represent 65% of our backlog, our incumbency and scale position us to lead. We've made a lot of progress at Vernova. I'll give you the high-level framing, and Scott's here today with additional color.

Power delivered strong growth, profit, and free cash. Grid was profitable for the full year, and Onshore delivered another quarter of profitability. Offshore remained challenging, but I really like the way we're using lean, along with better commercial selectivity and underwriting, to improve our outlook.

GE Vernova will stand on its own soon. I'm proud of the team's work to strengthen these businesses. And on a more personal note, I met Scott during my very first GE scout site visit. I have seen his leadership in action as he has led the team in executing the impressive turnaround at Gas Power and now the strong momentum building with our Onshore and Grid businesses. Importantly, Scott is an ardent student of lean, and I'm highly confident that he is the right person to lead GE Vernova into the future.

With our stronger more valuable businesses delivering now, GE Aerospace and GE Vernova are ready to go. We've assembled two extraordinary boards, bringing together domain expertise, diverse perspectives, and leadership experience to help GE Aerospace and GE Vernova rise to their sharper, more focused missions. We've also further simplified and strengthened our balance sheet, fully exiting our AerCap equity stake.

Looking ahead, GE Vernova plans to publicly file its Form 10 next month. Then GE Vernova and GE Aerospace will host Investor Days on March 6 and 7, respectively, in New York City. Both teams are excited to share how we'll create greater value for our customers and shareholders alike.