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| Statement |
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| So strong demand environment, good pricing on the renewables orders |
| It was a positive -- we were price-cost positive in '22 in Aerospace |
| Turning to the quarter, GE delivered a very strong performance and we're raising full year guidance again |
| GE Aerospace continues to experience rapid growth, driven by robust demand and solid execution largely in commercial engines and services, another significant quarter for the team |
| Taken together, for GE Vernova, we are now expecting high single-digit revenue growth and profit improvement of over $800 million year-over-year at the midpoint |
| So there is positive momentum on productivity |
| And we are encouraged by even the underlying progress on productivity that is currently sitting in our inventory numbers that will roll through next year |
| For the year, power continues to expect low single-digit revenue growth with better year-over-year profit |
| In the fourth quarter, power is well positioned for sequential profit growth from seasonally higher services volume |
| This, combined with power's continued strong performance, will drive meaningful profit and cash flow improvement at GE Vernova next year |
| In defense, we're pleased the U.S |
| Overall, we are really encouraged proving with grid and onshore that we can deliver better results |
| Army's Apache and Blackhawk helicopters, providing 50% more power, reduce lifecycle costs and lower fuel consumption |
| Price is clearly a positive for us |
| This was led by services, including higher gas utilization, up low single digits, benefiting from a continued coal to gas switching |
| Larry Culp And, Joe, just to make sure we're clear about the shipments, the progress that you're seeing at Dogger Bank and Vineyard, operationally, I think we're pleased to see that |
| Through our lean transformation, we're making real progress, improving flow and eliminating waste |
| But if you put all that together, it's still a pretty significant improvement year-over-year on both profit and then even more so on cash |
| There are pockets of improvement now, material input increased double digit sequentially supporting spare parts delivery, which was up significantly year-over-year |
| We're working within our own plants and in partnership with our suppliers to deliver sequential improvements and output and turnaround times day-by-day, week-by-week |
| If you look at the underlying performance that the onshore wind team has delivered here in the third quarter, will deliver in the fourth quarter, I think it's poised to deliver in '24 and beyond, you see all that coming home, which we're pleased to see, of course |
| Year-to-date, power orders have grown low single digits, revenue mid-single digits and margins have expanded over 100 basis points |
| Grid and now Onshore Wind were both profitable this quarter and we expect improved performance from here |
| So that is where -- I would say that is what gives us the confidence that this will be a continued good cash flow story |
| Year-to-date, orders remain strong and more than 3x revenue and with higher margins, which will support profitable growth through the decade |
| Profit grew roughly 60% with 200 basis points of margin expansion, driven by higher volume, pricing, and productivity, which more than offset inflation pressure |
| I really liked the way the grid team is using lean to drive this turnaround and to deliver profitable growth |
| And then progress payments, contract assets continues to be a positive as well given the strong growth environment |
| We are doing an exceptional job managing our days sales outstanding |
| But if you look at our working capital performance continues to be really strong this year |
| Statement |
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| As expected, Offshore Wind remains difficult this year, with losses of roughly $1 billion in 2023 |
| And like so many, I'm devastated by the loss of lives, violence and suffering of innocent people |
| Now as you pointed out, LEAP deliveries are a little bit lighter than we had initially expected |
| If you look at some of the delays that are a function of quality internally in the third quarter, we were at our lowest level in the last two years |
| But it is a problematic financial profile |
| So the OE mix headwind with the 450 bps in the fourth quarter to hit the 1,650 is I guess a lot of it |
| Services declined slightly as high single-digit growth in gas transactional services was offset by aeroderivative and steam services |
| So, 9x, that's going to create some incremental pressure |
| Today, we're navigating a still challenging supply chain environment to deliver for and support our customers |
| Rahul mentioned earlier some of the delays that we have seen in terms of on-time performance by our suppliers |
| So as we think about the outer year margins, we had guided to about a point of margin headwind from LEAP between '23 to '25 |
| But offshore will be difficult |
| But offshore will be difficult |
| It's primarily a function of our own supply chain challenges that we are having internally |
| So that's impacting the quarterly margin dynamic to a little bit |
| I think that's what we are thinking right now given how challenging supply chain has been and shop visits were up a couple of points in the third quarter |
| So I think Larry, you mentioned offshore losses of about 1 billion this year |
| The supplier delinquencies still remain high |
| And frankly, I've never been more confident in our company's future |
| Now we're expecting it to come down slightly as we get into the fourth quarter, but it will still be a substantial inventory build by the end of the year |
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