On August 1, 2017, my first day as CEO, our more than 300,000 employees had an email from me waiting in their inboxes. In it, I promised that I would “always own up to what is going well and what is not.”
I will do the same with investors. When I look back at 2017, there’s no doubt: GE had a very tough year.
Revenues were down 1% at $122.1 billion, and we delivered $(0.68) in earnings per share (EPS) on a GAAP basis. Excluding charges for insurance-related items, U.S. tax reform, and industrial portfolio actions, EPS was at the low end of our reduced guidance for the year, at $1.051. In 2017, GE returned $12.1 billion to investors through dividends and buyback.
While most of our businesses delivered solid—and, in the cases of Aviation and Healthcare, world-class—performances, our cash flow was challenging. We took significant charges at Capital and Power Conversion and made painful cuts to GE’s dividend and employment. We lost some of the intense focus on operations and rigorous execution that have been GE’s hallmarks for generations.
Many people have lost faith in us. I have not. As difficult as 2017 was for everyone connected with GE, it was also a chance to reflect on what this Company means and why it exists.
I want to be very clear on one thing: While I am not proud of our performance, I am incredibly proud of this Company. Our technology solves the world’s toughest problems. We fight for and support our customers in more than 180 countries. We innovate and drive new industrial paradigms like additive manufacturing and software and analytics. We launch products that lead in their industries. We operate with the highest integrity and commitment to compliance. We invest in our leaders and in developing global, diverse talent. And our employees dedicate themselves day in and day out to fulfilling GE’s mission.
(from John Flannery letter that accompanied the 2017 Annual Report)