General Electric Co.'s fourth-quarter revenue fell short of Wall Street expectations, with Europe's weakening economy and weak sales of appliances as the main culprits.
The largest U.S. conglomerate expects a volatile year but it plans to expand in emerging markets and cut back in Europe. Its shares fell 2.2 percent in premarket trading.
Its profit came in 1 cent per share above Wall Street's forecasts.
"We're concerned about the revenue miss," said Oliver Pursche, president of Gary Goldberg Financial Services in Suffern, New York. "That's really what we're focused on this earnings season. We're not so concerned about being a penny above or below expectations, because that can be handled with accounting."
The world's biggest maker of jet engines and electric turbines said net income from continuing operations rose 0.6 percent to $3.93 billion, or 37 cents per share, compared with $3.90 billion, or 36 cents per share, a year ago.
Factoring out one-time items, profit came to 39 cents per share, above the 38 cents analysts had forecast, according to Thomson Reuters I/B/E/S.
Total revenue came to $37.97 billion, down from $41.23 billion and below the $40.03 billion analysts had expected. Factoring out the effects of last year's sale of a majority stake in NBC Universal revenue would have been up 4 percent.
Revenue at the company's home and business solutions business — which includes GE's appliance arm — was down 4 percent in the quarter and GE Capital was down 9 percent, reflecting the continued paring back of that unit.
Sales at the railroad locomotive division were up 43 percent and GE's big energy arm — which it built up in 2010 and 2011 with an $11 billion wave of takeovers — was up 19 percent.
Chief Executive Jeff Immelt reiterated the company's forecast of double-digit earnings growth in 2012.
"There are a few challenged markets, like Europe and appliances, but on balance we have a positive outlook," Immelt told investors on a conference call.
Investors said Europe's financial crisis was taking a toll on the company.
"In December, GE indicated that it was managing Europe well. Now that's what is pointed to for the light revenue. I think that's kind of a weak excuse," said Jack De Gan, chief investment officer at Harbor Advisory Corp in Portsmouth, New Hampshire. "I was hoping the reason for the light revenue was because of the capital business."
GE is less dependent on Europe than rivals Siemens AG and Philips Electronics NV, which earlier this month warned that the Eurozone debt crisis would hurt their results this year.
GE noted that its industrial revenue in emerging markets was up 25 percent in the quarter, with strong growth in Brazil, Russia, China and India.
GE kicked off a wave of earnings reports from big U.S. manufacturers, with blue-chip peers United Technologies Corp., Caterpillar Inc. and 3M Co. all due to follow suit over the next week.
As of Thursday's close, GE shares had risen about 2 percent over the past year, lagging the 6 percent rise of the Dow Jones industrial average.
GE shares were down 43 cents at $18.71 in premarket trading from Thursday's close at $19.15.
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