The Fairfield, Conn., conglomerate also expanded its stock buyback plan, saying it will buy back $14 billion worth of stock over the rest of this year, and set plans to exit the subprime lending business. GE also guided in line for the third quarter and year.
For the quarter ended June 30, the company made $5.42 billion, or 52 cents a share, up from the year-ago $4.95 billion, or 46 cents a share. Revenue rose to $42.32 billion from $37.75 billion a year earlier.
Analysts surveyed by Thomson Financial were looking for a 52-cent profit on sales of $41.7 billion.
For the third quarter, GE said it expects to make 54 to 56 cents a share, compared with a 55-cent Wall Street estimate. The company said it is "on track to deliver a solid, low-risk performance in 2007 with high visibility to organic growth."
"Infrastructure and Commercial Finance, which account for 56% of segment profit, led our strong performance this quarter with profit growth of 23% and 18%, respectively," CEO Jeff Immelt said. "Global demand for our Infrastructure products and services is unprecedented with double-digit revenue and earnings growth in Oil & Gas, Aviation, Energy, and Transportation. Strong global origination at Commercial Finance contributed to double-digit growth in assets, revenues, and earnings.
"We are building a highly visible and sustainable growth pipeline around the world," Immelt said. "We are winning with technology and deepening customer relationships through services. Our total orders were up 32% to a record $25 billion, and total backlog grew $18 billion year-over-year, an increase of 42%. Major equipment orders were $13.1 billion, up 54%, and major equipment backlog grew to $44 billion, up 53%. Services orders were up 11%, and our Customer Service Agreement (CSA) backlog stands at $96 billion, up 10%."
Immelt said GE took $600 million worth of restructuring charges in the latest quarter, including a $200 million hit at GE Money tied to the planned sale of the WMC subprime lending business.
"For the quarter, GE Money had strong global growth in revenues and assets, and increased segment profit 8% despite a loss at its U.S. mortgage business, WMC," Immelt said. "We have made the decision to exit this business and substantially reduced our exposure by selling $3.7 billion of WMC loans in the quarter."