GE shares dropped 62 cents, or 2.3%, to $26.58 on Friday after GE said profit margins at units making jet engines, medical scanners and locomotives expanded last year less than the 0.7 percentage point that Immelt set as a goal in December 2012 and affirmed last month.
The misstep comes as Immelt focuses on manufacturing growth while shrinking the
"They didn't quite make it and some people are going to be disappointed they didn't hit the number," said Christian Mayes, a St. Louis-based analyst at Edward Jones & Co. "They hit the consensus numbers pretty much right on the head for sales and earnings per share, but missing the margin goal will be noticed."
GE reported that net income rose 5% to $4.2 billion, or 41 cents a share, for the October-December period on revenue of $40.38 billion. That's up from $4.01 billion, or 38 cents, on revenue of $39.16 billion in the fourth quarter of 2012.
Adjusted to remove the effects of one-time items and discontinued operations, GE earned 53 cents a share in the latest period. That matches what analysts polled by FactSet expected.
For the year, GE's net income rose 3% to $14.06 billion and revenue slipped less than 1% to $146.05 billion. GE has been scaling back its financial division, called GE Capital, and it has shed nonindustrial divisions such as NBCUniversal. It plans to spin off its large consumer credit card business this year.